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Blog
Enhancing NHS Efficiency: The Critical Role of Clinical Coding
Paul Henderson, Director of Consulting, UK&I Healthcare & Government, IQVIA
Apr 24, 2025

Secondary Care provider organisations struggle to describe the scale and complexity of their services, which as a result can impact the productivity of their funding and abilities The problem is multi-faceted and the ability to find and use money in funding rests with an often-undervalued set of staff.  In this short blog Paul Henderson, Head of Consulting at IQVIA explores the power of clinical coding and how systematic service reviews can use data to improve productivity and revenue recovery.

When the NHS was reimbursed using Payment by Results (PbR), and more latterly using the Elective Recovery Fund, there was a great deal of focus on the accuracy of clinical coding.  In the early days of PbR coding maximising income became a dark art which had many unintended consequences. For example, commissioners and providers used data to argue over how to equally spread shares of a finite budget that was set with a lower level of activity in mind, and mortality statistics became skewed by inappropriate application of coding rules.

Block contracts were introduced, and the arts were not as celebrated because they were intended to maximise revenue at a time when there was no opportunity to do this, due to the fee-for-service payment regime.

The problem was further exacerbated by the challenge in finding clinical coders to work with clinicians to capture the data accurately.  Clinical coders need to undergo a training programme with an onerous exam to prove they can code accurately.  It’s a skill that is undervalued by the NHS and we are now reaping the consequences of people not choosing it as a career and therefore  a war for an ever diminishing pool of talent is upon us.

In the last twelve months, I have reviewed several organisations’ Secondary Uses Services (SUS) submissions which are the mechanism used to count and profile hospital activity.  If Trusts were to be reimbursed for the full scale of activity they perform, according to NHS rules and with their submissions independently verified, the government would need millions of pounds to fund that reimbursement.  Millions of which it does not have.

But there is a deeper problem.  Looking at this through a patient-level costing lens, it is possible to see areas of huge unwarranted variation in practice where Trusts operate in a different way.  This view is only possible when you have accurate and granular data, but as the architect Van de Rohe said: God is in the detail. These small differences, multiplied across multiple clinical interventions across organisations constitute a big number, where the NHS can improve its efficiency and quality of service at the same time.

We have tested this hypothesis in service reviews with clients, using a three-step process.

The results were startling.  We could see, at an intervention or transactional level where there was unwarranted variation in practice and where organisations cost improvement plans, for example, could be at risk of going awry.  In one Trust, for example, we were able to use an analysis of properly coded data to determine priority specialties for deeper service reviews, based on where we felt we could make the most impact on their ability to transform. These deep dives into the priority specialities enabled us to uncover the drivers of operational and financial instability, and to co-produce levers of change.

The conversation might start with an organisations ability to code and a discussion about the revenue that could be recovered by improving coding depth, but it should end with a “So What”.  It might be possible to recover more revenue through a PbR equivalent, but it also might not. However, if you take a holistic approach to measurement, analysis and insight-led transformation then there is the opportunity to improve the quality and cost-effectiveness of services.  This is how we do it.

To learn more contact us today.

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