Claim denials are an unfortunate, regular occurrence in the world of healthcare organizations. While there are very few organizations who can claim a denial rate of zero, many providers struggle with maintaining and implementing effective claims denial management processes.
There is an optimistic truth, however: Up to 90 percent of claim denials are preventable. When providers make it a goal to adopt an appropriate claim denials management system, they increase their chances of identifying claim issues as a way to prevent them from happening. Challenges such as tracking denial statistics, using manual processes, receiving avoidable denials and appealing claims all stand in the way of successful claim processing.
Tracking Denial Statistics
The first step is to better claims denial management is to identify denials and the reasons for them. This is challenging for several reasons.
First, it is not always guaranteed that providers will have access to claims denial data from payers. Companies sometimes consider this information proprietary. Data, such how often claims are denied, is often kept private because of competition. Companies restrict access to this data to prevent potential customers from going to a competitor with a lower denial rate.
Additionally, each insurance company has its own rules for denying claims and reporting claim denials to providers. Unfortunately, there isn’t an industry standard for how this information is reported, and therefore it becomes difficult for providers or payers to analyze and present claim denials data.
For example, providers may find it difficult to decode payer language used in claim denials. Additionally, the method that each company uses to communicate the reason for a denial may vary.
Using Manual Processes
There are innumerable health IT tools that can manage everything from patient care to business operations. By choosing to use automated processes to manage healthcare administrative duties, such claim processing, administrators can empower themselves to increase efficiencies across the claim processing lifecycle. However, providers still use manual claims denial management processes.
Automating claim denials management processes can help hospital administrators in several ways to avoid denials. When using a manual process, medical billers must know the intricacies of their healthcare organization as well as the nuanced rules and codes for the variety of payers their provider may work with. When using an automated process, many solutions can catalog and implement these various codes and other complexities into your claims process.
Automation also can help coders identify issues with claims before they are submitted, and can also allow you to set up reminders of deadlines, so you never receive an automatic denial due to missing a crucial moment on the submission timeline. Solutions like eReceivables can automate your billing claims process so that it is more timely and direct, while also allowing you to gain greater collections.
Receiving Avoidable Denials
Most claim denials are preventable. Missing information, duplicate claim submissions, service adjudication issues, noncovered services and missing deadlines are some of the most common reasons why claims are denied. By ensuring that all staff members, from the front office attendants to the medical billers and coders, use the best practices put in place to prevent data and administrative errors, hospital administrators can combat claim denials.
Changing the attitude of hospital administrators and staff from reactionary to proactive takes time. Yet, by taking the step of automating processes when it comes to claims, billers and coders can be alerted to any potential trouble areas so they can get things right the first time. In turn, this will work to save providers time, money and resources.
Appealing Claims Through a Resource-Intensive Process
Expecting a claim denial rate of zero is probably unrealistic. Many insurance companies have an appeal process for claims denials. Providers can work together with insurance companies to provide any corrected information needed for the claim to be reimbursed or to make their argument as to why the claim should be approved.
This process is not without loss, though. There is a cost associated with reworking claims after a denial. It’s time-consuming, labor-intensive and draws resources from other places to chase the denied claim. By implementing an automated process from the start, administrators and staff can save time and money and reinvest in proper training for staff and establish proper processes.
There are several challenges hospital administrators face when streamlining the claims denial management. By analyzing the data and utilizing an automated system to reduce errors providers and administrators can anticipate their denial management systems to become more successful.