Decimal Code

Decimal Code is an Ann Arbor, Michigan-based healthcare software company that applies natural language processing and machine learning to medical coding and clinical documentation improvement. Its patented process creates local, site-specific models trained on a provider's own historical data, reading clinical and operative notes to extract relevant information and assign billing and diagnostic codes. The product set focuses on perioperative care — surgery and anesthesia — while the company states the system works across specialties.

Two principal use cases are described: automated medical coding, in which easy cases are batch-billed and more complex cases are routed to human coders with supporting data, and prior authorization CPT mismatch detection, which flags discrepancies between codes on authorization requests and codes on the eventual claim, as well as surgical deviations and missed procedures, before no-authorization write-offs occur. Every prediction is accompanied by a confidence score and supporting signals, which the company frames as a transparency mechanism for clinical and coding staff.

The company originated at Michigan Medicine out of roughly six years of research and development, and its models were developed using 15 million cases spanning 84 research hospitals. Its team combines clinicians, data scientists, researchers and medical billing specialists, and it has published research on automated CPT code classification from surgical notes and on machine-learning classification of anesthesiology CPT codes from EHR data.

Founding story

The company grew out of work at Michigan Medicine. Mike Burns and John Vandervest led a research consortium of 84 health systems holding 15 million procedural cases, and needed anesthesia billing codes to deliver real-time quality feedback to clinicians; because codes took weeks or months to return through traditional billing, they began predicting them directly from operative notes. After the health system's CFO saw the results, the approach was extended beyond anesthesia, leading to a process patent and 52 live models across specialties at Michigan Medicine. Joey Panella met the two in 2019 while working at the University of Michigan's Venture Center, where he supported research spinouts, and became more involved in 2021 when the team sought a commercial counterpart.

Business model

Decimal Code sells its AI coding and CDI software to healthcare provider organizations. It charges an implementation fee plus a per-case fee that varies with the complexity of the medical specialty, and positions this pricing as a discount relative to traditional medical coding before accounting for additional charge capture. The company states it aims to capture a fraction of the value it creates for customers.

Implementation fee plus per-case usage fees, priced according to the complexity of the medical specialty being coded.

Traction

As of March 2026, three health systems beyond Michigan Medicine, with one fully deployed and two actively deploying, plus 52 live models across specialties at Michigan Medicine. The company cites a Michigan Medicine revenue cycle administrator attributing $2.3M in annual recaptured revenue to previously missed arterial line placement and in-person ultrasound coding. Reported product outcomes include a 41% reduction in prior authorization denials, a 44% reduction in coding costs and a 70% reduction in coding time.

Latest developments

In a March 2026 interview, the CEO said the company was actively closing a $750,000 pre-seed round, with $525,000 committed from existing investors, intended to expand the engineering team as it scales to new sites.