Why Is Documentation Important in Healthcare?

Clarity, NLP
8 minute read

“If you didn’t document it, it didn’t happen.”

It’s a popular saying in the healthcare industry, and it helps illustrate why documentation is important in healthcare. In few other industries is thorough, efficient documentation as essential as in the healthcare field, as inadequate record keeping could result in claims denials, lower productivity, lawsuits, and even negative patient health outcomes.

With so much at stake, many healthcare providers heavily invest in clinical documentation improvement (CDI) systems to streamline their record-keeping processes. Electronic health records can facilitate communication between providers, patients, and payers, but if those records aren’t properly maintained, the same consequences can still result. That’s why it’s important that facilities not only invest in the proper tools to improve their clinical documentation, but that they implement best practices as well — and the first step to that is understanding why documentation is so important.

In this article, we’ll explore why documentation is important in healthcare and demonstrate how essential it is. First, we’ll look at some of the main challenges caused by inadequate documentation to give some idea of its true cost. Then we’ll give some strategies for improving your documentation processes as well as the benefits you may be able to see, and then show you how Consensus can help. 

The Importance of Documentation in Healthcare

Without proper documentation, virtually every component of our healthcare infrastructure would suffer. From more medical errors and negative patient health outcomes to more frequent claims denials and lawsuits, the medical industry would only be bogged down further by poor documentation. The areas where documentation has the greatest impact are:

  • Patient care. A patient’s quality of care can suffer in many ways when accurate documentation is lacking. Clinicians are more likely to make medical errors if they have an incomplete picture of the patient’s health status, and the result can range from a poorly conceived plan of care or incorrect treatment — or even a patient’s death.
  • Communication. A patient’s care is especially hindered when the different members of their healthcare team are unable to communicate smoothly. Patients often have multiple clinicians, and failure to implement proper documentation may cause them to create conflicting treatment plans, leading to a disruption in continuity of care.  
  • Profitability. When medical records such as clinical notes, progress notes, or other medical documentation are incomplete, inaccurate, or improperly worded, the result may be a claims denial or delay in payment. In this way, incorrect documentation practices can destabilize your revenue cycle management (RCM) and make your organization less profitable than it would be if it abided by the appropriate documentation requirements.
  • Liability. Malpractice lawsuits are all too common and can be very costly to a healthcare organization. When providers exercise sound documentation practices, they minimize their vulnerability to a lawsuit, saving themselves all the burdens of a legal battle. 

To fully grasp why documentation is important in healthcare, understand that each factor is tied to the others. For example, breakdowns in communication between clinicians can result in suboptimal patient health outcomes, which can in turn lower reimbursement rates if certain quality care metrics aren’t met. Such inferior care reduces the organization’s profitability and can also increase the risk of a lawsuit — which further damages the bottom line — and inadequate documentation is at the root of it all. 

Challenges and Issues Related to Inadequate Documentation

Because it’s so central to providing quality healthcare, failure to maintain adequate documentation can present many challenges both to the patient and the provider. 

From a patient’s standpoint, a provider’s failure to maintain their medical records could result in: 

  • An oversight in their medical history, now or in the future
  • An unclear treatment plan for how to approach their condition going forward
  • A misunderstanding of their diagnosis
  • A need to explain their medical history repeatedly, resulting in frustration and dissatisfaction 

From a provider’s standpoint, inadequate documentation could lead to: 

  • Delayed payments 
  • Denied claims
  • Lower reimbursement rates
  • Missed opportunities for more revenue; such as undocumented services that were rendered but never billed

While these challenges primarily affect profitability for the provider and safety for the patient, they can impose a financial burden on the patient, too. The patient will likely be responsible for paying any claims that their insurer has denied — claims that would have been approved if insurers had received adequate documentation of the care provided — meaning that poor documentation also raises healthcare costs for the consumer.

The Critical Role of Clinical Documentation Improvement (CDI)

Organizations that truly understand why documentation is important in healthcare have realized that the benefits of improving their documentation systems far outweigh the costs. That’s why they take steps to optimize not only their electronic records, but their medical record documentation processes as a whole.

Clinical documentation improvement (CDI) seeks to evaluate patients’ EMR documentation for completeness and accuracy, and it benefits both the patient and the provider. From a health perspective, CDI can help fill in the gaps in a medical document, reducing the likelihood of errors and improving patient safety. From a financial perspective, CDI helps make sure that medical records aren’t missing important information that a payer might need for approval.

Better healthcare for the patient and more profitability for the organization — CDI empowers both, making it critical in today’s healthcare landscape. 

Strategies for Enhancing Documentation Processes

Effective documentation is essential for delivering quality healthcare, but implementing a strategy to see that best practices are followed is no easy task. Some strategies involve taking steps such as periodically reviewing chart reviews, while others require finding a set of healthcare documentation solutions that can help improve your processes. 

Perform Regular Chart Reviews

The first step in improving your documentation systems is to review your patients’ medical records on a regular basis. You won’t know what information is most often omitted from your patients’ charts if you don’t review them frequently, and doing so will allow you to educate clinicians on information they should add to the chart in the future.

Your CDI specialist probably won’t be able to review every chart, so conduct spot checks as often as possible. The frequency will depend on the size and nature of your organization.

Develop and Implement Documentation Standards

Standards help create consistency across your charting system. That reduces the likelihood of oversights and simple mistakes and makes the chart review process easier too.

There are plenty of resources available from regulatory bodies to help you develop a medical record documentation standard that works for your organization. Avail yourself of them as you draft your own policy, and consider adopting guidelines that would assist other professionals as they read your patients’ charts as well. 

Use Structured Data Entry

The healthcare industry contains massive amounts of unstructured data. Whether it’s faxes, prescriptions, point-of-care documentation, lab results, or other non-quantified items, unstructured data is more difficult to process and convert into actionable insights, so it’s better to use structured data when possible.

Alternatively, organizations could use healthcare documentation tools that possess natural language processing (NLP) capabilities, as these can convert unstructured data into a structured format. When you seek out a medical documentation software solution, look for one with NLP abilities — such as our product, Clarity CD.

Implement Electronic Query Management

Electronic query management allows you to access patient data wherever you need. By giving your clinicians more mobile access to their patients’ charts, they will be able to respond to their needs more promptly. Make it a part of your documentation strategy.

Use Real-Time Clinical Decision Support (CDS)

Clinical decision support gives healthcare professionals additional knowledge pertaining to their patients’ condition at the time they need it most. It curates patient data to provide relevant insights to the clinician, enabling them to make a better diagnosis. By implementing it into your documentation framework, your providers will be able to diagnose their patients more accurately and provide more complete charting in the process.

Benefits of Effective Documentation for Healthcare Facilities

There are many benefits to be realized when healthcare facilities implement best documentation practices. Some of these are:

  • Higher reimbursement rates
  • Fewer claims denials
  • Quicker payback periods
  • Less legal liability

Most importantly, your patients will receive higher quality care than they would otherwise receive without it — and that’s always a sound investment.

Future Proof Your Healthcare Documentation With Consensus Cloud Solutions

Whether it’s shifting regulatory requirements or rapidly evolving patient health scenarios, the world of clinical documentation is always changing. Amidst all those changes, the need for thorough, transparent, efficient documentation will be one of the few constants that will remain. In fact, as payment models are based increasingly on patient care outcomes, proper documentation will become even more important.

Consensus Cloud Solutions exists to help healthcare professionals improve their documentation processes, and we provide a number of products to do it. One of our platforms,  Clarity CD, aims to improve EHR interoperability by delivering a centralized platform to manage patient data, communicate with other members of the patient’s healthcare team, send sensitive messages securely, and remain compliant with existing regulations and best practices. We offer a suite of other products designed to improve your operability and documentation processes, so contact us today to request a demo of our solutions.