Definition. When the insurance company reduces the code (and corresponding amount) of a claim when there is no documentation to support the level of service submitted by the provider. The insurers computer processing system converts the code submitted down to the closest code in use which usually reduces the payment.
You'll come across Downcoding while working the revenue cycle — from eligibility and claim submission to payment posting and denials. See the related terms below, or browse the full glossary and the Knowledge Hub.