May 23, 2024

Breaking Down Billing: What Is Bundling and Unbundling in Medical Coding and How Can EMR Software Simplify the Process?

Breaking Down Billing: What Is Bundling and Unbundling in Medical Coding and How Can EMR Software Simplify the Process?

The rules of medical coding are perplexing, with even the most seasoned behavioral health clinicians finding themselves with an added layer of complexity for each client’s case.

When not bundled properly, insurance companies may be quick to delay, reject, or outright deny a claim. This can leave both the clinician and the client in the lurch.

Bundling and unbundling in medical coding doesn't have to be the arduous task it once was.

With the right software, behavioral health clinicians save countless administrative hours bundling and unbundling medical coding while focusing on quality client care.

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Ritten: A Behavioral Healthcare EMR Platform That Automates Bundling and Streamlines Integration With Claims Management Software

Ritten’s Behavioral Healthcare EMR Software makes bundling and unbundling in medical coding easy. Our streamlined system not only integrates with your claims management software to ensure compliance but it’s also designed to recognize when services should be bundled or unbundled.

With Ritten, behavioral health clinicians save time and money when submitting claims and ensure proper reimbursement every time.

For more information, request a demo today.

Bundling and Unbundling in Medical Coding

Behavioral health clinicians are faced with the task of deciding whether to bill a procedure as bundled or unbundled based on each client’s specific treatment plans. This can be complicated and may lead to billing errors that result in delayed or denied insurance claims. 

Knowing when to bundle and unbundle in medical coding rules is essential to the financial health of the facility.

What Is Bundling in Medical Coding?

Bundling in medical coding, often referred to as "code bundling" or "coding bundling," is a process used to group specific medical procedures or services under a single code or a set of codes. This grouping is typically done to streamline billing and reimbursement and to avoid double-counting or overpayment for related services. 

Example of Bundling in Behavioral Health

Let's consider a client receiving psychotherapy for the treatment of depression. In this case, the therapist may provide both individual therapy sessions and family therapy sessions as part of a holistic treatment plan. 

The services rendered might include: 

  • Individual therapy
  • Family therapy; and 
  • Consultation with the client's primary care physician

Instead of billing each service separately, which could result in multiple claims and possible overbilling or administrative complexity, medical coding in behavioral health might allow for bundling these services under a single code or claim. 

This bundling simplifies the billing process, streamlines reimbursement, and accurately represents the integrated care approach.

What Is Unbundling in Medical Coding?

Unbundling in medical coding refers to the practice of separately billing or coding individual components of a medical procedure or service that should be billed together as a single comprehensive code. 

Unbundling is typically considered incorrect and can lead to claims denials, overpayment recoveries, and legal issues because it can result in higher reimbursement than what is appropriate for the actual services rendered.

However, there are situations in behavioral health where unbundling of medical codes can be appropriate and accurate. One such example could involve the billing of multiple therapy services provided during a single session, each of which is distinct and separately billable. 

Example of Unbundling in Behavioral Health

Let’s say a behavioral health clinician is conducting a therapy session with a client who has complex needs. During the session, the clinician provides individual therapy for the primary mental health concern and, separately, conducts family therapy to address family dynamics and support the client's treatment. The session also involves case management, as the clinician coordinates care with other healthcare clinicians and conducts assessments.

Unbundling in this scenario accurately reflects the variety of services provided during the session, each of which has its own specific code to represent the distinct nature of the services rendered. It allows for precise billing and reimbursement for the different elements of care offered in a complex behavioral health session.

Behavioral healthcare organizations, including hospitals, clinics, and individual practitioners, are responsible for ensuring proper coding practices and adhering to coding guidelines and rules. Medical coders and billers play a crucial role in this process by accurately coding procedures and services in accordance with industry standards.

Who Provides Industry Guidelines for Accurate Bundling and Unbundling in Medical Coding?

Code bundling is governed by various coding systems and guidelines, including those from the American Medical Association (AMA) and the Centers for Medicare and Medicaid Services (CMS).

  • American Medical Association: The AMA publishes the Current Procedural Terminology (CPT) code set, which is widely used for reporting medical procedures and services. The CPT code set includes detailed descriptions of medical services, and it provides instructions on proper code usage. The AMA's CPT Assistant newsletter and other resources offer clarification on coding issues, including bundling and unbundling.
  • Centers for Medicare & Medicaid Services: CMS, a federal agency within the U.S. Department of Health and Human Services, plays a significant role in developing and maintaining coding and billing guidelines, particularly for Medicare and Medicaid claims. CMS publishes the National Correct Coding Initiative (NCCI) edits, which include bundling and unbundling rules for Medicare claims. The NCCI edits identify code pairs that should not be billed separately because they represent integral or inclusive components of a larger service.

Behavioral healthcare clinicians must stay updated with the latest coding guidelines and bundling/unbundling rules provided by the AMA and CMS as well as any relevant updates from private insurance companies. By doing so, they’ll maintain accurate coding practices and avoid issues such as claims denials and overpayment recoveries.

What Are the Challenges Billers Face When Bundling or Unbundling Services?

Some of the challenges encountered by medical billers when dealing with bundling or unbundling in the medical coding and billing process include:

  • Complex coding rules
  • Frequent changes
  • Insurance guidelines
  • Risk of denials
  • Audit risks
  • Documentation challenges
  • Ethical considerations
  • Educational requirements
  • Coordination with coding professionals
  • Client and clinician communication
  • Appeals and rejections

Overcoming these challenges necessitates a strong understanding of coding and billing regulations, ongoing training, effective communication, and a commitment to ethical billing practices. Accuracy and compliance are essential to ensure successful medical billing processes.

In addition to the above challenges, billers must pay close attention to the following billing processes when bundling and unbundling in medical coding.


"Incidentals" refer to services, supplies, or components that are inherently related to the main procedure or service and are considered integral to it. These incidentals are typically bundled with the primary procedure or service and should not be separately billed. 

Bundling incidentals is done to prevent double-counting and ensure appropriate reimbursement.


Modifiers in medical coding are two-digit codes or descriptions that are added to a CPT or HCPCS (Healthcare Common Procedure Coding System) code to provide additional information about the service or procedure performed. They play a crucial role in clarifying the circumstances under which a service was provided, altering the code's definition, and ensuring accurate reimbursement. 

When it comes to bundling and unbundling in medical coding, modifiers are used to indicate special circumstances and, in some cases, to justify the separate billing of multiple procedures.

Errors (Biller and Payer)

Errors made during bundling and unbundling in medical coding can have several adverse consequences, both for healthcare clinicians and clients. 

Some potential problems that may arise due to such errors include:

  • Loss of revenue
  • Claims denials
  • Increased audits
  • Legal and ethical issues
  • Reputation damage
  • Compliance violations
  • Operational inefficiencies
  • And more

To avoid these problems, healthcare clinicians must ensure that their coding and billing processes are accurate and compliant with industry guidelines. Software systems and technology that support correct coding and compliance can be valuable tools in preventing these issues.

How Ritten’s Behavioral Health EMR Software Can Help Simplify the Coding Process

Simplify bundling and unbundling in medical coding with Ritten. Our software creates an automated process that identifies services typically bundled together, services that are normally cash billed because payers won’t cover them, and services that aren’t billable and will bundle them accordingly.

With Ritten’s intelligent EMR software, billers save copious hours decoding the nuances of bundling and unbundling in medical coding while safeguarding against lost revenue. 

Documentation Review

In addition to identifying whether the services provided should be bundled or unbundled, Ritten’s EMR scans and reviews all the necessary backup documentation to ensure it is complete, current, and compliant. 

If your documentation is incomplete, our software will automatically alert the user.

Daily Billable Services

Our EMR system intuitively pre-bundles services for you so that your daily billing is 90% complete before submitting a claim. Our software then integrates flawlessly with your claims management software, saving you hours of manual billing every week.

Supports Non-Traditional Bundling Models

The traditional model for bundling and unbundling in medical coding is centered around insurance-based claims. But with Ritten, billers can build non-traditional billing systems (such as non-profits or Medicaid) that can be replicated for future clients who fall into non-insurance categories.

Simplify bundling and unbundling in medical coding with Ritten. Request a demo today.

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