Doctors:

Are Your Claims Being Quietly Downcoded?

Doctors: Watch Your Claims

This is happening in Illinois—but if you practice somewhere else, don’t scroll past this.

The Illinois State Medical Society is warning physicians that it has received reports of insurers increasing downcoding activity ahead of a new state law that takes effect January 1, 2028. Downcoding occurs when a payer reduces the level of service you submitted on a claim, resulting in lower reimbursement.

Illinois physicians fought back—and won important new protections. The Transparency in Downcoding Act will require human review of downcoding determinations, prohibit downcoding based solely on diagnosis codes, require greater transparency when a claim is downcoded, and provide a process for disputing those decisions.

But there are two lessons here for every private-practice physician, regardless of where you practice.

First: Keep your eyes open.

An insurer policy being reported in Illinois today does not mean similar payment practices couldn’t appear elsewhere. Start watching your EOBs, remittance notices and reimbursement patterns. If you’re seeing unexplained reductions, don’t simply assume your billing department made a mistake.

Second—and perhaps more importantly: You don’t have to simply accept it.

A payer reduces your reimbursement and it’s easy to think, What can I do? They’re the insurance company.

You can question it.
You can appeal it.
You can document patterns.
You can involve your state medical society and appropriate insurance regulator.

Illinois physicians organized around this issue, and their advocacy helped produce legislation that passed both chambers of the General Assembly unanimously.

If you’re practicing in Illinois and experiencing what you believe is unwarranted downcoding, ISMS is specifically encouraging physicians to file complaints with the Illinois Department of Insurance, which can investigate insurer practices under laws already in effect—even though the new downcoding protections themselves don’t begin until 2028.

And if you’re not in Illinois?

Consider this your early warning.

Pay attention to what is happening with your claims. Know what you’re actually being paid. And when something doesn’t look right, ask questions and challenge it. Don’t let your claims be silently decoded!

Private-practice physicians have more power than they sometimes realize—but only when they know what’s happening and are willing to speak up.

Don’t just treat the patient. Watch the payment.

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