Denials are Preventable, But How to Eliminate them through Practical Approaches?

medical billing denial management photo

“90% of the Denials are Preventable!”

In our experience, the statement proves to be true.

Indeed, focusing on just one of your most preventable denials can revolutionize the entire revenue cycle, bringing hefty financial gains. Nevertheless, it’s highly crucial to get to the root cause of each and every denial and make necessary adjustments to stamp them out completely while preventing their recurrence.

Claim Denials & Rejections

A Claim usually gets denied when it is processed by the payer but gets a negative determination over it, while on the other side, a claim gets clearly rejected when it doesn’t meet the specific requirements set by the insurance companies as per the standard guidelines.

“Administrative Expenses keeps on Multiplying if Denials continue to Pile Up.”

Rejected claims never get a chance to be entered into the system(as if they are not received) and they need to be resubmitted after correcting the errors. On the flip, denied claims are received by the insurance payor organization but are not submitted again rather are sent for reconsideration or appealed. 

If your hospital or medical practice often witnesses claim denials or rejections then surely your organization spots:

-Increased billing work

-Growth of frustration

-High revenue leakage

-Low reimbursement rate

-Degraded patient experience

Certainly, claim denials represent chronic and growing financial problems that underscore the challenges providers face in running their healthcare organization. Well, there are a few effective methods of work which when applied right and on time can help to reduce administrative costs of denial work and appeals to a remarkable extent.   

Principal Causes for Medical Billing Denials 

#Missing Data

Any required entry if goes missing on the claims form can cause denial and become the reason for rework.

No one can afford to miss any mandatory data field on the claims form that either relates to the patient or the service provider as it can be heavy on the entire process of revenue cycle management.

Demographics, inaccurate CPT codes, technical errors, missing social security numbers, etc. become reasons to trigger a denial, thus, raising the count of denial write-offs.

#Xerox/Duplicate Claims

Sending resubmitted claims again is among the biggest reasons for claim denials. 

Duplicacy occurs when a claim is resubmitted by the same provider for the same beneficiary for the same service as per the same date for a single encounter. The payor company denials such claims as either they are in the queue of being processed or are being processed.

Such claims are not entertained and ultimately are denied.

#Service Not Covered by Payor

Mistakenly or through negligence, this also becomes a viable cause of medical billing denials where no checks are done over the patient’s insurance eligibility. Due to manipulations in the payor organization’s policies, it might be where some procedures are not covered under the patient’s current benefit plans.

This misconception or err might end up calling for a service’s billing denial.

#Service already Adjudicated

This error occurs when benefits for a certain service are included in the payment/allowance for another service or procedure that has already been adjudicated/processed/executed.

#Resubmission/Filing Limit Expired

Claims are to be submitted under a stipulated period of time/days of service.

If not, they can cause delays that push the medical billing past the deadline and further hamper the financial progress of the healthcare organization. Thus, the administrative staff must be alert and aware so as when the claims reach their time limit or expiry.

After being acquainted with the major factors that trigger denials of medical claims, let’s delve into the solutions that can help your medical practice get rid of claim rejections and improve denial rates.

[Prefer Reading: Top Tips to Improve Medical Billing Process & Revenue Generation]

Effective Ways to Improve Denial Rates 

-Improve Patient Data Quality

At the time of patient intake and registration, data quality must never be compromised by missing any of the crucial patient information. As this is the initial step of managing a patient’s medical billing account, it becomes the source of manual errors, and, ultimately denials.

-Avoid Assumptions

Appropriate management of the revenue cycle can never form its base on assumptions. Whether it’s related to billing codes, service(s), patient’s beneficiary plan, or more, the staff must go beyond generic explanations and get the accurate data in hand.

-Determine the Root Cause

Certainly, determining the root causes is truly essential to prevent them from occurring again. This requires digging deep into the loopholes and identify the alert areas to retrieve meaningful data which can be accurately done by implementing Intelligent Automation that proves to be an essential segment in denial management.

-Quantify & Categorize Denials

This helps to prevent the circumstances of a claim to be generated in the first place. It’s very crucial to categorize denial types so as to avoid their causes in the next/future billing processes. Technology and analytics here become reliable partners to acquire guided business intelligence.

-Optimize Claims Management Software

This is required to help ensure edits are functioning, current, and improving your clean claims rate. Claims are managed within the modern EHR systems that provide clean claims rate data and reports on a timely basis.

An Automated Approach to Eliminate the Occurrence of Denials & Rejections

When the talk is about advanced technology embedded in the Revenue Cycle Management, it mostly infers the implementation of automation within the electronic medical record systems that significantly impact the internal/external workflows and productivity.

Intelligent automation process, when involved in medical billing, provides detailed information of denial issues and how best to resolve them, thus, allowing the workforce to expedite rework and secure resolution for high-low value claims. 

This undoubtedly is done quickly and accurately.

Category-specific queues are formed that provides insights into claim summaries along with the recommended actions to be taken for denied or delayed claims.

Robotic Process Automation software/bots mimic human activities that perform an array of tasks in a comprehensive range of areas, empowered with their capabilities of decision-making logic and algorithms.

All in all, Automation enables denial prevention and its acute management, thereby, producing a rapid return on investment.

[Prefer Reading: Automate RCM Processes to Reduce Expenses & Debt Collection]

How Robotic Bots Prevent Denials?

#Predicting Potential Denials

Advanced billing software systems are capable enough to enable practices to determine any patterns that relate to emerging denials, extracting from historical data. Analyzing these patterns the team is alerted upon future claims following similar traits so that the potential issues logged can be resolved.

Automated bots do not completely take over the control rather allow professionals to take caution and make rational decisions on forwarding and submitting claims in the final go.

#Increasing Clean Claim Submissions

Once the front-end claims are clean and accurate, the probability of denials consistently decreases. Software bots on predicting potential denials eliminate the chances of occurrence of denials that further leads to faster payments and reimbursements.

With logging accurate data into the EMR systems in the first go, denial risks become void and frequency of submission of clean claims increases. 

#Enabling Proactive Adjustments

This majorly deals with the root cause analysis of the problematic claim found by the software system where the information is conveyed to the professionals to edit and react smartly recognizing the previous errors and preventing them again before submission.

Insights rendered by the automation helps to elevate the effective claim process by ensuring error-free claims in the first place which is required when a claim is on the route to denials.

[Prefer Reading: Advantages Healthcare Organization can Reap out of Automation]

In a Crux

Medical Billing denials and rejections appear as one of the significant challenges a healthcare organization witnesses, nevertheless, with avoided negligence and support of modern automation-enabled software, a practice can surely shape its denial management aspects strategically and improve its overall efficacies.

Automation is a one-stop solution to examine claims and identify potential denial causes where machines communicate with humans to adjust the gaps, alleviate errors, and reduce denial rates.

So stay current with the medical billing trends and automation advancements with NetSet Digital and let us know how do you want us to bolster your practice in optimizing its revenue cycle while eliminating the loopholes and filling the gaps.

[Prefer Reading: [2021] Top Trends In Medical Billing & Coding]

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