Medical billing denial is the constant headache for providers that negatively affects your organization's revenue, cash flow, and operational efficiency. It is observed that medical billing denial rates range from 5-10% in medical practices while better performers averaging 4%.
Some organizations even see denial rates on first billing as high as 15-20% and those providers need to rework on one out of every five medical claims. The rework on the denied claims costs an average of $25 per claim and the success rate vary from 30 to 98% based on the capabilities of your denial management team.
You can easily get out of this headache, if you adhere to policies and procedures on which the billing staff can be trained on or you can outsource your billing to us and rest assured. Medical Billers and Coders have a 95% clean claim submission rate which can enhance your revenue and reduce rework drastically.
In this article, some tips are given which help you to shift the focus from denial management to denial prevention. Let’s understand them in detail:
Know the magnitude of the problem
You should adopt a framework of iterative processes that can reduce the denial rate consistently. While making this framework you need to understand the magnitude of the problem at hand which can easily be understood with the help of the following measures.
- Denial Rate
- % of high dollar value claims that have been denied as a % of the total number of denied claims.
- % of claims appealed
Understand reasons for denial
Here are some claim denials based on common reasons are given below:
Prior authorization
You practice as well as patients suffer if you neglect to get pre-certification (or pre-authorization, or whatever term the particular insurer uses) as it can cost your practice and your patient's money. Also, it can seriously decrease patient satisfaction hence knowing which insurers require pre-authorization and for what is essential.
Insufficient or incorrect information
Simple clerical errors, such as a patient's name being misspelled, or digits in an ID number being transposed are often lead to claim rejections (which don't usually involve the denial of payment).You can easily fix this but these errors prolong the revenue cycle, so you want to avoid them at all costs.
Timely filing issues
Different insurers impose different deadlines for claims submissions, and they have different policies about what you can do when you miss a deadline. It is observed that a phone call will clear all delayed claims submission but in others, you may have to fill out more paperwork.
Use of Out of the network provider
Year to year there may be a change in insurer networks and patients may unaware of it or that changing insurance companies may change medical providers that patients can see and get full benefits. During appointment booking or registration your billing staff get patient insurer information that can allow your billing staff to determine whether your practice belongs to a patient's insurer network, and if not, what sort of benefits (if any) the patient can expect.
Duplicate claims
Duplicate claim denials are considered as one of the top billing errors and in the case of Medicare, duplicate submission of claims harm provider in cost, valuable time, and resources. When more than one claim is submitted from the provider for the same service, same patient, same date of service called a duplicate claim. In most instances, the claim was already processed and paid or it is an exact duplicate of a previously submitted claim.
Measuring the success of your denial management program
When you want to measure the success of a denial prevention program, you should measure the overall reduction in the denial rates and success of the appeals submitted. On a short-term basis, claims resubmission and success rate rates act as a good sign but the end goal is a considerable change in the denial rate.
Finally, nobody likes to work on denied claims and it increases the time to get paid for services hence there are many steps apart from the above which minimize the risk of claim denials. Continuous dialogue between patients and insurers, skilled coding professionals, and front desk staff as well as exceptional medical billing processes can all help to focus on denial management to denial Prevention.
