Reduce The Claim Denials With Medical Billing Services

 

Medical billing is the financial backbone of healthcare operations, ensuring healthcare providers receive rightful reimbursement for their services. However, the persistent challenge of claim denials remains a significant obstacle that hinders revenue streams and impacts the overall financial health of healthcare organizations.

According to the Centers for Medicare and Medicaid Services (CMS), the denial rates for claims within the network show significant diversity among insurers on HealthCare.gov in 2021. On average, close to 17% of claims within the network faced denials. However, the denial rates showed considerable variability, from a minimum of 2% to a maximum of 49%.

Understanding the root causes of claim denials and implementing effective solutions becomes imperative as we navigate the complex medical billing landscape. Let's explore how Medical Billing Services catalyze reducing claim denials for a more robust and sustainable healthcare financial ecosystem.

The Primary Causes of Medical Billing Denials

Medical billing denials fall into two categories- hard and soft. Hard denials are irreversible and lead to revenue loss. On the contrary, soft denials are temporary and potentially reimbursable if providers address claim issues or provide additional information.

Missing Information

Leaving a required field blank on a claim leads to medical billing denials. Demographic and technical errors, such as missing modifiers, incorrect plan codes, or missing Social Security numbers, are some of the biggest reasons for initial denials and write-offs.

Duplicate Claims or Services

Resubmitting claims for a single encounter on the same date by the same provider for the same beneficiary and service item is a major reason for Medicare Part B claim denials.

Service Already Adjudicated

This error occurs when benefits for a specific service are already included in the payment or allowance for another service or procedure adjudicated.

Not Covered by Payer

Denials for procedures not covered under patients' current benefit plans are mitigated by verifying details in the insurance eligibility response or contacting the insurer before delivering services.

Limit for Filing Expired

Many payers mandate medical claims submission within a specified timeframe. Delays, whether due to automated system edits or complex reviews, can push billing past deadlines, especially for correcting inpatient medical coding errors.

How to Reduce the Claim Denials for Medical Services

Whether it is Medical Billing Services for Small Practices or big hospitals, if the entity follows proper strategies, it can achieve a high rate of reduction in claim denials.

Let’s examine the various methods to minimize claim denials for medical services.

Verify Insurance and Eligibility

Ineligibility constitutes approximately 24% of all denials. Despite long-term patient relationships, individuals undergo job and plan changes. Ensure coverage continuity by confirming no termination, met maximum benefits, and service coverage. Staff should comprehend accepted plans, interpret policies, and discuss coverage with patients comfortably.

Collect Accurate and Complete Patient Information

Leaving a single field blank can lead to denials. Incomplete data, such as incorrect plan codes or missing Social Security numbers, causes initial denials and write-offs. Crucial information includes patient details, insurance, and accurate identification. The best solution is to issue “report cards” to enhance accuracy.

Verify Referrals, Authorizations, and Medical Necessity

One crucial cause of denials is authorization. Understanding medically necessary services, prior authorizations, and referrals is vital. Obtaining prior authorization doesn't guarantee payment, hence, claims must align with medical necessity, should filed within deadlines, and be attributed to the authorized provider.

Ensure Accurate Coding

One of the best ways to reduce denials is coding specificity. Using current codes and preventing fraudulent practices like upcoding and unbundling is crucial. Staff protocols should mitigate risks associated with coding errors.

Stay Updated on Pandemic-related Billing Changes

Pandemic-related changes come with various challenges. Stay informed about reimbursable services, particularly for telehealth and telephone visits. Awareness of new codes and continuous review of guidelines and code descriptor changes are essential to minimize denials.

Know Your Payers and Their Rules

Understanding payer requirements prevents rejections. Check eligibility responses, call insurers, and establish relationships for efficient issue resolution.

Submit Claims on Time

Adhering to payer-specific deadlines is important. Implement processes and reminders to ensure timely submissions, which helps reduce denials.

Use Technology for Clean Claims

Implement technology to automate data collection and claim reviews. Utilize alerts in practice management systems to enhance accuracy.

Monitor, Analyze, and Audit

About 5% of denial rates require review. Conduct audits to identify and address mid-cycle issues and prioritize changes for maximum impact on the bottom line.

Ensure Accurate and Complete Documentation

Clear documentation, including specific diagnoses, procedure details, and patient history, is crucial for proper coding and payment. Even if it is Outsourced Medical Billing Services, providing feedback to physicians and conducting training sessions for front-end staff can improve documentation.

 

Wrapping Up

The most suitable way to minimize claim denials in healthcare involves a strategic approach and leveraging medical billing services for an effective solution. The collaborative efforts of healthcare providers and medical billing services significantly reduce claim denials, promote financial stability, and ensure a more efficient and effective healthcare revenue cycle.