January 11, 2016
Regarded as a critical step in the medical billing process, denial management deals with reducing the need of re-submitting claims and speeding up the turnaround time of collections.
5% to 20% of collections are lost due to ineffective denial management leading to no or low reimbursement. Hence, the understanding of why claims are being denied so as to not repeat those mistakes in future, and increase the percentage of getting it paid correctly and completely the first time is extremely crucial. The best practice is for the staff to work on a regular basis on denial management. This medical billing process can be a success if the claims are submitted according to specifications. It could also be made possible with the help of 'Denial Management Software Systems.'
To name a few, the chief reasons that have been identified which delay this medical billing process are registration issues, duplication or/and documentation, insurance eligibility, bundled charges/procedures, referrals and authorization, non-covered/invalid codes etc. Therefore, the below mentioned strategies on managing denials, increasing collections, and enhancing the medical billing process effectively need to be implemented:
Number of claims denied:
As most data is electronically available, keep note of the total number of claims filed, value in dollars and percentage of claims denied (segregate as per specialty, location, reason and payer) which will aid in tracking and reporting.
Charge entry analysis:
Verify diagnosis and procedure codes before submission to the payer.
Analysis of the root-cause:
It is important to understand the root cause of the denial as such denials could have occurred in the past. Instead of working towards payments from insurance providers, it is advisable to analyze the denied claims and work towards removal of such errors in their entirety.
Once the issue has been identified, decide and work towards fixing the error and closing of loopholes permanently to aid the billing process and enhance collections.
Prepare a checklist, collate documents, and implement the solution decided while re-submitting the claims. Also, maintain a file of 'corrective measures.' Corrections should also be made in the medical billing software.
Once the claim submitted has been accepted, provide this solution as a benchmark to other peers so that such mistakes do not occur in future.
Keep abreast of the new rules of the payer and exercise them for complete claims.
The software should have the ability to be integrated with other systems along with up gradation of new codes and rules.
Ensure that the payer pays all claims timely and in full by real-time reporting measures.
All these aspects enable the A/R team to manage denied claims more effectively thereby speeding up the medical billing process. A fully integrated system with medical billing, scheduling etc. can streamline the revenue cycle. It is vital to submit claims on time, decrease similar denials and increase the revenue recovery.
Accounts Receivables / Claims Denials