Strategic Coding in the Assessment of Long-Term Care Needs: Evidence from France

There is strong evidence of a phenomenon known as ‘overcoding’, whereby healthcare providers overestimate the severity of a condition in order to increase their billing revenue. Much less is known about strategic coding in the évaluation of patients’ eligibility for long-term care. This article draws on a unique dataset from linked French surveys to show how the évaluation of patients depends crucially on the incentives faced by the staff responsible for this évaluation. The author finds that nursing homes evaluate their patients as being more severely disabled (thereby increasing their revenue) than home-based assessors, who seek to minimise the amount of disability benefits paid. Public long-term care facilities are more likely to overestimate levels of disability; it also appears that patients with cognitive disorders or from socially disadvantaged backgrounds are more likely to have their disability ‘upcoded’. In the context of care homes, this over-assessment could be interpreted as ‘circumventive coding’, driven by shortcomings in the évaluation tool which do not allow the care provider to be adequately remunerated for the time they devote to these patients. Conversely, assessors of patients receiving care at home may underestimate the level of disability in order to transfer some of the care tasks to informal caregivers.