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Background  The accuracy of clinical coding is crucial in the assignment of Diagnosis Related Groups (DRGs) codes, especially if the hospital is using Casemix System as a tool for resource allocations and efficiency monitoring. The aim of this study was to estimate the potential loss of income due to an error in clinical coding during the implementation of the Malaysia Diagnosis Related Group (MY-DRG ® ) Casemix System in a teaching hospital in Malaysia.    Methods  Four hundred and sixty-four (464) coded medical records were selected, re-examined and re-coded by an independent senior coder (ISC). This ISC re-examined and re-coded the error code that was originally entered by the hospital coders. The pre- and post-coding results were compared, and if there was any disagreement, the codes by the ISC were considered the accurate codes. The cases were then re-grouped using a MY-DRG ®  grouper to assess and compare the changes in the DRG assignment and the hospital tariff assignment. The outcomes were then verified by a casemix expert.    Results  Coding errors were found in 89.4% (415/424) of the selected patient medical records. Coding errors in secondary diagnoses were the highest, at 81.3% (377/464), followed by secondary procedures at 58.2% (270/464), principal procedures of 50.9% (236/464) and primary diagnoses at 49.8% (231/464), respectively. The coding errors resulted in the assignment of different MY-DRG ®  codes in 74.0% (307/415) of the cases. From this result, 52.1% (160/307) of the cases had a lower assigned hospital tariff. In total, the potential loss of income due to changes in the assignment of the MY-DRG ®  code was RM654,303.91.    Conclusions  The quality of coding is a crucial aspect in implementing casemix systems. Intensive re-training and the close monitoring of coder performance in the hospital should be performed to prevent the potential loss of hospital income.

bmc health services research

Potential loss of revenue due to errors in clinical coding during the implementation of the Malaysia diagnosis related group (MY-DRG®) Casemix system in a teaching hospital in Malaysia