KPI Comparison Series: Lesson 2- Top 10 Denials in Healthcare Billing
Denials in healthcare billing can be a significant challenge for healthcare organizations, impacting revenue and creating administrative burdens. Understanding the common reasons for denials and implementing strategies to avoid them can help organizations improve their revenue cycle management.
At Ignite Healthcare Solutions, we recommend clients track their top denials. The top 10 denials, regardless of aging, are important to trend monthly to drive efficiencies and overall improved financial performance. This type of trend analysis can help organizations improve upstream workflows and decrease the volume of downstream workflow impacts. As a former practice manager, digging into what was driving my overall accounts receivables helped the organization improve front-end workflows, negotiate better contracts with payers and invest in the staff accountable for managing the daily operations.
Here are the top 10 denials in healthcare that we typically see and tips on how to prevent them:
Missing or Incorrect Patient Information: Denials often occur due to missing or inaccurate patient information, such as demographic details or insurance details. To avoid this, ensure that patient information is accurately recorded and verified during registration, check-in, and managing eligibility through the Eligibility Worklist and Eligibility and Phone List.
Lack of Prior Authorization: Many denials result from services being performed without obtaining prior authorization from the insurance company. Implement a robust prior authorization process to ensure that all necessary approvals are obtained before services are rendered. We recommend monitoring upcoming appointments with reporting to identify upcoming appointments with missing authorizations or referrals.
Coding Errors: Coding errors, such as using incorrect codes or modifiers, can lead to denials. Conduct regular audits of coding practices and provide ongoing training to coding staff to ensure accuracy. We recommend working with a certified coder to audit documentation and update your fee schedule on an annual basis.
Non-Covered Services: Some services may not be covered by a patient's insurance plan, leading to denials. Verify insurance coverage and inform patients of any services that may not be covered before they are performed. By using the denials report in athena, you can track non-covered services by payer.
Timely Filing Limits: Insurance companies have specific time limits for filing claims, and failure to submit claims within these limits can result in denials. Monitor filing deadlines closely and submit claims promptly. By always working claims by highest dollar and oldest DOS, you can prevent timely filing issues.
Duplicate Claims: Submitting duplicate claims for the same service can result in denials. Implement processes to prevent duplicate claim submissions by creating claims from an appointment or using athena’s rules to identify duplicate claims. In some cases, these duplicates can be a result of sending corrected claims without using resubmission codes.
Coordination of Benefits (COB) Issues: COB issues can arise when a patient has multiple insurance policies, leading to confusion about which policy is primary. Verify primary insurance coverage and coordinate benefits appropriately to avoid denials.
Medical Necessity Denials: Insurance companies may deny claims that they deem medically unnecessary. Ensure that all services are supported by appropriate documentation to justify medical necessity.
Credentialing Issues: Denials can occur if providers are not properly credentialed with insurance companies. Keep provider credentials up to date and ensure that they are enrolled with all relevant payers.
Claim Discrepancies: Denials can result from discrepancies between the amount billed and the amount allowed by the insurance company. Review claims for accuracy and ensure that they are billed correctly.
Regardless of your RCM platform, leaders should understand the top 10 denials and implement a strategy to manage for continuous improvement and financial state of steady. Need help implementing a strategy? We’re here to help. Let’s chat!
