Final answer:
Unbundling occurs when multiple charges are submitted to an insurance company separately for procedures that should be reported with a single code, which can lead to higher costs and potential fraud. Correct coding practices are essential for both fee-for-service and HMO systems to ensure fair reimbursement and maintain an efficient healthcare system.
Step-by-step explanation:
The term for when procedures and/or services are performed and incorrectly coded as multiple charges to the insurance company when a single code should be used is known as unbundling or fragmentation. Unbundling can result in higher costs for patients and insurance providers and may be considered fraudulent. In medical billing, unbundling violates the guidelines set by the American Medical Association's Current Procedural Terminology (CPT).
Medical providers must ensure billing integrity by using correct, singular codes that encompass all the provided services, in contrast to separate billing that may suggest more complex or multiple services. The fee-for-service model and HMO systems directly influence reimbursement practices, and in both cases, accurate billing matters. The avoidance of unbundling helps maintain a fair and efficient healthcare system, preventing adverse selection and other insurance market issues.