(NBC News) – Doctors say insurers are automatically downgrading their claims and paying less. Insurers say it’s their duty to prevent overbilling.

It’s a practice called “downcoding.” Insurance companies — in Wagner’s case, Aetna — automatically downgrade the claims a doctor sends them to a lower tier of reimbursement, without actually reviewing details about the visit itself.

For Wagner, that means a “level four” office visit that might yield $170 is being paid as if it’s a “level three” for about $125. That $45 difference might not seem like much, but when it’s happening on dozens of claims, and to a physician-owned practice like Wagner’s, the damage mounts. “This can really hit a small company hard, especially if you’re not catching it,” he said.

If the doctor wants to challenge the decision, they have to appeal each claim with documentation defending their medical opinion. (Read More)