3 Simple Steps to Lower Denial Rates in Healthcare Billing
Keeping revenue flowing through efficient billing and claims is vital in healthcare organizations but often poses big challenges. Addressing claim denials from both insurance companies and individual payees to reduce the denials rate and the time lag between patient service and payment will likely affect multiple teams, from the front office staff to the back office team.
But it’s worth the investment in time. Healthcare Financial Management Association (HFMA) found that in just one month in 2018, out of $3 trillion in total claims submitted by healthcare organizations, $262 billion were denied, equaling nearly $5 million in denials, on average, per provider.
Boost Midwest helps lower denial rates thereby freeing up a practice’s cash flow whether for a two-doctor family practice or a full medical practice containing several clinics. Using our proven AIM: Analyze, Innovate, Manage approach, the impact is felt within a few short months. “The workflows that you go through with patient check-in, patient check-out, and billing process and revenue cycle management—there’s a lot of similarities no matter what your size is,” founder Marie Stacks shares.
While there are three simple steps a healthcare practice can take to lower claim denials, first, let’s examine the top causes of high denial rates:
Missing information. A required field left blank on a claim form or incorrectly entered patient information can trigger a claim denial. Missing or wrong information regularly triggers approximately 60% of medical billing denials, Becker’s Hospital Review CF0 Kelly Gooch noted in 2018.
Duplicate claim or service. These are claims resubmitted for a single visit with one provider.
Service isn’t covered by the payer. Health insurance plans usually don’t cover all procedures, so before administering services it’s important to know what will or will not be covered.
Improper or lack of coding. Code claims to the fullest level of specificity possible, with all identifiers and modifiers included every time. Going granular when coding claims will lower denial rates, especially in claims systems where denials are easily triggered.
Patient is ineligible for services. To make sure your patient is covered by insurance, double check their insurance information at the start of each visit.
Claim is missing authorizations. If proper authorization for a service is not obtained prior to the patient receiving service, the claim will likely be denied. When submitting a claim, make sure proper authorization was obtained for the service and link or attach all proper documentation.
The time limit for filing has expired. Most payers require claims be submitted within a specific time window, even for complex claims. Implementing new workflow practices to alert staff when medical claims approach the time limit is one way to address this.
The service has already been adjudicated. This denial occurs when benefits for a specific medical service was already included in a claim for another service or procedure already adjudicated by the payer.
For actionable changes that will reduce denial rates, Boost Midwest starts with some simple steps with often dramatic results. For one client, adding just one word to its check-out process measurably increased its cash flow. Boost Midwest suggested that instead of asking patients, “Would you like to pay for your service today?” the patient check-out staff ask, “How would you like to pay for your service today?”
Not all changes are as simple. A comprehensive plan to reduce claim denials takes up to six months and requires buy-in and training for teams across the organization. But here are three simple ways an organization can take to reduce denial rates while addressing larger systemic issues.
Proofread claims for errors before submission. Simple patient information errors like the wrong birthday or gender, or an incorrectly entered address or social security number, can trigger denials.
Ask the right questions at patient check-in. Patient registration is often the source of errors in information that lead to claims denial. Educating staff to ask a specific set of questions using predetermined language will reduce issues of insufficient information.
Sharpen coding practices. If a claim is not precise enough, the insurance carrier is more likely to deny the request. Professional development for medical coders to keep them knowledgeable about industry coding changes, best practices and efficiencies that can be implemented into medical coding is a start in having claims be adjudicated successfully.
“There’s only one right answer, but there’s a million ways to get there,” Stacks notes. “But even the smallest changes can impact a practice at every level.”