Denied claims can be quite exasperating for billers as well as providers. Not only valuable time gets consumed in claim re-submission but it also costs money to manage an average denial. This means a significant amount for rendered services is already lost even if the billing department manages to collect payment through re-submission.

If your denial rate is more than 5%, it means you are not paying attention to your revenue cycle. It can result in major erosion of revenues, forcing you to close down or merge your practice with a hospital.

Industry Facts :

According to the Medical Group Management Association, approximately $25 to $30 gets spent on managing an average denial
Nearly 30% from the total filed claims gets denied due to minor errors in coding and technical aspects
As per the research done by the American Medical Association (AMA), there was a sharp increase in claim denial rates in 2012; however, in 2013, claim denial rates reduced by 47%
Medicare happens to have the high denial rate at 4.92% while lowest denial rate is of Cigna at 54%
As per an estimate by the CMS, there are chances of claim denial rates increasing by 100% to 200% in the early stages of ICD-10 coding

What causes claim denials?

There are various reasons due to which payers reject medical claims:

  • Lack of accuracy in registration, wherein a wrong payer is mentioned, the patient's insurance is not verified or it becomes difficult to decipher the identity of a patient
  • Charge entry is done with unacceptable diagnosis codes or procedure codes
  • Inadequate information about a patient
  • No substantial proof to prove the medical necessity of a procedure
  • Lack of pre-authorizations and referrals
  • Errors in clinical documentation
  • Lack of credentialing
  • Submission of claims with duplicate codes for the same procedures
  • Bundling non-allowable items or applying modifiers where they aren't applicable

How to reduce the occurrence of denied claims?

  • Identifying the type of denial because denials can be clinical as well as technical
  • Training staff on how to submit error-free claims, edit claims and prepare appeals
  • Formation of a strong billing team with certified, experienced coders and billers
  • Monitoring the progress made by in-house or billing company's team on a regular basis

Most medical practices are overloaded with work due to which they have very little time to fulfill the above-mentioned requirements. Since denial management is a daunting task, they prefer outsourcing billing and coding services to a billing company that has proven capabilities of providing effective denial management.

Tackling claim denial with MBC:

MBC has the largest consortium of certified coders and billers, helping practices maximize revenue and minimize claim denials. The team at MBC is well-trained in error-free claim submission, follow-ups with insurance companies and effective denial management. MBC also specializes in:

  • Analysis of the financial impact of denials
  • Finding causes for the accumulation of denied claims
  • Providing feedback through a financial impact analysis of denials and root-cause analysis

MBC helps practices maximize and accelerate their cash flow through:

Charge entry analysis + Tracking payer denials + Tracking claim status

Published By - Medical Billers and Coders
Published Date - May-21-2014 Back

Looking for a Medical Billing Quote?

Are you looking for more than one billing quotes?



Looking for a Medical Billing Quote?

Are you looking for more than one billing quotes ?





Would You like to Increase Your Collections?