Does Hospital Electronic Medical Record Adoption Lead To Upcoding or More Accurate Coding?

This paper seeks to evaluate whether the adoption of electronic medical records (EMRs) leads to upcoding for hospitalized Medicare patients, defined as categorizing a condition as more serious than justified in order to inflate bills, or more accurate coding. We use a triple difference: (1) between EMR and non-EMR hospitals; (2) before and after the 2007 Medicare payment reform, which made obtaining high payments harder; and (3) between medical and surgical admissions. For medical admissions, we find that the interaction of Medicare payment reform and EMR hospitals leads to higher codes, regardless of the financial incentive to upcode. For surgical admissions, we find no significant effect. While there is no evidence of upcoding, EMRs lead to higher billing by increasing the accuracy of coding for medical admissions. JEL Codes: