According to Forbes, hospitals lose over $45 billion each year as a result of unpaid medical bills. Because of the heavy burden of denial management and a focus on collecting larger claims first, low balance claims often become overlooked. While it’s understandable that large claims tend to take precedence, hospitals should also consider how the successful appeals process for low balance claims can have a positive impact on accounts receivable (AR) management.
The adjudication process for low balance claims follows the same process as that of larger claims. There are, however, a handful of ways to more quickly resolve the low balance appeal.
Consider how the following six steps can help your organization successfully resolve low balance medical claims:
Triage Denied Claims
Train staff members to go into triage mode as soon as an insurance company denies a claim. The claim should be examined immediately to determine why the request for reimbursement was rejected. It goes without saying that a problem cannot be fixed until it has been correctly identified.
Play by the Insurance Company’s Rules
Each insurance company has its own protocols, and no insurer is going to change its ways of doing business in an attempt to better suit your preferences. Before your staff initiates the appeals process, its members should seek to fully understand every aspect of the protocol. Their response to the insurance company should be on target and complete. It’s a good idea for staff members to call the insurance company if questions persist.
Once the instructions and responses are clear, the appeal should immediately be filed, and here’s a step that is too often overlooked – your staff should confirm that the insurance company has received the appeal. Nothing should be assumed.
Make a Compelling Case for Appeal
The appeals process can be time-consuming, but there’s no use shortcutting steps and ending up with a second claim denial. It’s important that your staff members take whatever steps are necessary to make a compelling case; sometimes this requires going the extra mile.
For example, if an insurance company denies a claim because of a need for more specific details about a particular service, they must be given exactly and in direct accordance with what has been requested. In this case, the most effective choice might be to have a physician type or dictate a thorough response that explains how the patient benefitted from the service in question. That response should then be provided to the insurance company, using the same terminology that had been used within its denial. This prevents the need for further clarification or for an additional appeals process.
Don’t Leave Stakeholders in the Dark
It is important to keep patients updated throughout the process of denial management. If they are unaware that their claim was denied or uninformed about your organization’s efforts to adjudicate the denial, all they will see is the unexpected final bill.
It’s hard enough to collect direct payment from patients, but this can become much more difficult when they have become irate over unpaid claims. By having your staff carbon copy patients and other stakeholders, any dispute will be brought into the open, and patients will be able to see that every effort has been made to resolve a problem.
Compile Similar Claim Denials
On occasion, the same type of services will be denied for the same reasons. These repeat denials should be compiled. Presenting the related claims to the insurance company at one time will likely result in quicker resolution, and it will definitely save valuable employee time.
Make a “Hassle Folder” for Individual Insurance Companies
The creation of “hassle folders” is a simple but effective way to categorize and quickly identify trouble claims with respect to a particular insurance company. These types of claims can be organized in a hassle folder in a number of ways, but experience shows that sorting them out by type and dollar value can be highly effective.
To make the hassle folders more useful, the information contained within them should be reviewed on a quarterly basis, with a focus being placed upon measuring and comparing the records of denied claims. This will lend insight into the practices of each insurance company and potentially help prevent future billing practices that could potentially trigger more hassles.
Claim denials are inevitable, but extended appeals do not have to be. While the first step in the appeals process is always to identify the reason for denial, there are a handful of other behaviors that will help speed the appeals process and result in a higher rate of payment. It is important that your employees are well-versed and comfortable with these behaviors; it is their success in resolving low balance medical claims that will help move the needle in a positive direction with relation to AR collections.