Claim denials in healthcare occur when an insurance company or carrier refuses to honor an individual’s or provider’s request to pay for healthcare services acquired from a professional. Healthcare claim denials are a perennial source of frustration for hospitals and healthcare providers, affecting revenue, cash flow, and operational efficiency.
According to a 2017 estimate, out of the $3 trillion in medical claims submitted by US hospitals, $262 billion of those claims were first refused. That equates to a denial rate of about 9%.
The Doctor-Patient Rights Project poll that same year revealed that one in every four insured Americans has a 24% denial rate. Patients with chronic or persistent illnesses, in particular, are denied care for their critical ailments 70% of the time.
When it comes to denial management in healthcare, clearly something needs to change. Patients and those who care for them need to be able to receive treatment without having to jump through hoops.
Continue reading if you want to understand how to manage the denial process. Everything you need to know about denial management is right here.
Look for the root cause of Claim Denials
The first step in denial management solutions is determining why you’re getting so many denials. Using accessible data to assist you to assess the revenue cycle management procedures is one technique to establish what the contributing elements are.
You may utilize it to determine where the denials are occurring since various variables contribute to this continuous problem. Take note of patient access and registration.
Discover where the most mistakes are made
Make it simple for patients to enter their information accurately the first time. Examine the documents for disallowed claims. There is frequently insufficient documentation. Examine how and where you can make this process better. Claims are frequently denied due to coding and invoicing problems. Check that everyone has access to the necessary codes. Another element is payer behavior. Check that you have access to all of the data you require, that it is available in a timely way, and that you have established a procedure that allows for excellent decision-making.
Eligibility and Prioritization
Once you’ve identified the source of the problem, it’s time to prioritize the areas that will have the most influence on your budget. See if you can trace the source of the problem to a single-payer, department/physician, or a specific procedure that obviously isn’t operating correctly. Lack of eligibility accounts for 23.9 percent of all rejections. And there is a rather simple approach to avoid claim denials due to eligibility. Hospitals must develop a policy that monitors patient eligibility throughout the whole care process, beginning with appointment scheduling and continuing until the claim is submitted. Establish a method for informing patients that they are ineligible for a procedure and discuss their financial responsibilities and payment choices if they wish to proceed.
Form Interdepartmental Teams
When you have the correct team of individuals helping you make ongoing changes to the procedures that are presently in place, denial management in medical billing becomes easier to overcome. Top medical billing companies have strong interdepartmental teams to tackle denial issues and due this tactic they face less denials. This team should include illustrations from all departments. The team must meet on a regular basis to identify the core problems and discuss how to permanently address them. Departments frequently fight change at first, and some may find it difficult to discuss difficulties in front of others. However, by discussing the reasons for rejections and the financial impact these denials have on each department. Each department should be able to take on greater leadership and responsibility. As a result, there is more communication across departments and fewer denials.
Improve Your Communication Skills
When dealing with denial management, it’s tempting to throw fingers at other departments rather than communicate as a team. However, the only way to make this work is to work together. Share relevant information about the outcomes to help put the data into context. Create an environment of trust and safety as well. No one wants to freely discuss or contribute if they fear they will be criticized or suffer sanctions if a root cause is discovered in their region. Instead, in order to save themselves, they will purposefully conceal facts and refuse to communicate. Create a blame-free workplace that is focused on solving problems rather than pointing fingers.
Enhance Staff Education about Claim Denials
Educate your staff who will be involved in preregistration, registration, and admissions. If they can answer challenging questions regarding insurance and the verification procedure from the start. It will be simpler to avoid future insurance denial issues. Teach this personnel how to track verification levels using analytics. It is simple to boost eligibility verifications while decreasing denials with education and a basic grasp of analytics.
Design a Reliable Claims Processing System
Due to missing or incorrect claim data, 14.6 percent of claims are refused. Create a mechanism to view claims throughout midscale and just before forwarding the claim to the payer to assist address this issue. It is a chance to identify errors and make required changes. Because each payer has distinct criteria and preferences, edits must be tailored to them. Request that your revenue cycle service provider collaborates with you to create bespoke modifications. You can also request that they develop additional guidelines based on recent payer behavior. These guidelines should be updated on a regular basis to reflect any changes that may affect whether or not a claim is refused. Annually, review revisions to detect and resolve possible inefficiencies and/or concerns.
Utilize Technology to Increase Productivity and Reduce Claim Denials
There are several health IT technologies available on the market today to assist you in managing anything from patient care to day-to-day corporate operations. Nonetheless, many providers continue to submit handwritten claims. Claims are already complicated enough without having to personally fill them out. By automating your denial management process, you may make life easier for your employees, patients, and company. A vendor-provided solution can assist you in ensuring that your claims are submitted in accordance with each payer’s regulations and standards. You may therefore file more claims more quickly and with fewer issues that result in claim denials.
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