Top Proactive Denial Management Tips to Reduce Claim Rejections

“Denial” is hardly ever a beneficial word to come across. Especially when you’re at the receiving end of it, be it your visa application, loan application, or any application awaiting approval. And this word takes on a whole new avatar when it comes to revenue cycle management. Besides just being a metric to measure the success of a firm, it also directly reflects the financial success of the firm.

Claims are highly sensitive documents that require scrupulous scrutiny before submission. It’s almost like walking on thin ice. Claims are denied when they don’t meet a set of required criteria of the insurance company or carrier, thus leading to the rejection of funds to cover the services provided by the healthcare provider. The set of requisite criteria may vary from one insurance company to another. In essence, they are all similar but not exactly the same. So, an accurately populated template that works with one carrier may not necessarily work with another. “Clean claims” are those that successfully navigate the approval process and receive the green stamp. Clean claims are a pleasure for the provider. Healthcare firms dream of achieving and holding a 100% clean claims rate—an aspiration that isn’t even remotely as easy as it may sound.

15 Solutions for Claim Denial Management Services to Enhance Cash Flow

How can you maintain a denial rate below 5% and increase unhealthy cash flow? The main lesson is to avoid delaying. Address the issue(s) immediately, and review, rectify, and resubmit denials within the next week.

The following are common reasons for claim denial management services, along with solutions that can help enhance your cash flow:

1. Someone submitted a claim twice for the same service or procedure. Before resubmitting an unpaid claim, consult with the insurance payer, who may be processing it. Determine the reason for the claim’s nonpayment, or whether the clearinghouse rejected it.
2. The patient is ineligible for services due to the expiration of their health plan coverage.It is imperative to verify the patient’s insurance coverage at the time of check-in. To guarantee that you have the correct claim filing address and critical information, copy both sides of the card.
3. The physician does not belong to the insurance network. Ensure that the insurance payer has authorized the provider. Submit and monitor provider credentialing applications in accordance with the insurance plan’s specifications. To ensure that providers enroll in-network when enrollment opens, maintain regular communication with insurance payers.
4. Invalid or missing patient demographics and insurance information. At all times, confirm the spelling of the patient’s name, date of birth, responsible party, vision, and medical plan numbers. A single required field, a transposed number, or a letter will trigger a denial.
5. The benefit exceeds the permissible number of services or visits. Provide the insurance payer with confirmation of the patient’s eligibility. Within a calendar year, numerous insurance companies provide coverage for only a specified number of visits or services.
6. The primary complaint was missing. When documenting the chief complaint, provide a succinct explanation of the problem or laboratory test. If you find yourself under audit, this will be beneficial. A missing chief complaint, based on inaccurate levels of care, may result in a claim denial.
7. A prior authorization number is necessary for the claim. A critical initial phase in the RCM process is the verification of a patient’s insurance benefits. Whenever possible, obtain authorizations from the insurance payer prior to the patient’s visit to your office. Before submitting the claim, make sure to include the prior authorization number.
8. The referring physician and referral information are absent. Verify whether a referral (written order) from the patient’s primary care provider is required, and that the referral number on the claim is accurate. This will ensure continuity of care and establish a transparent patient treatment record.
9. The modifier is invalid, or the claim lacks a code or modifier. The HCPCS or CPT® codes incorporate modifiers to specify the reason for a physician’s provision of a specific service or procedure. Not all modifiers are compatible with all HCPCS or CPT codes. Payers will deny your claim if even one procedure code is inconsistent with the modifier or if a modifier is missing for the applicable service date. For instance, Modifier 25 is among the most frequently misused modifiers. When performing both a procedure and a substantially unrelated and separately identifiable evaluation and management (E/M) service during the same session or on the same day, use modifier 25. When an E/M service leads to a surgical decision, we should apply modifier 57 instead of modifier 25.E/M services. If tests are required due to two separately identifiable conditions, it may be possible to link the appropriate diagnosis code to each CPT code and add modifier 59 to the second procedure, depending on the local policy. Check out our blog, “How (and How Not) to Use Common Medical Billing Modifiers,” for additional billing guidelines and to identify potential red flags when using common modifiers.
10. The billing should have been separate, not combined. Bundling may be necessary for certain services, such as laboratory profiles that include multiple tests or an all-inclusive rate that covers the minor procedure as well as the pre-and post-procedure visits.
11. The performed procedure does not align with the place of service (POS). Revise the CPT® code or place of service code, and resubmit the claim. Make sure the point of service (POS) aligns with either the face-to-face service provider’s location or the technical service provider’s location for non-face-to-face services like diagnostic test interpretation.
12. The plan’s benefits do not cover the service or make it medically necessary. Consult the insurance payer’s website and your Local Coverage Determinations (LCD) policies for a list of covered diagnoses.
13. The claim does not include postoperative care dates. Verify the postoperative dates and incorporate the omitted dates into the claim form. You need these dates to ascertain the length of postoperative care the patient received. The dates also confirm that care is included in the global surgical program. Furthermore, it may be necessary to submit a new claim form or modify the original claim form in accordance with the insurance plan’s policies. In order to avert any additional delays or denials, consult with your insurance provider.
14. The National Drug Code (NDC) identifier is absent. The NCD is a distinctive medication identifier that furnishes critical information, including the label, product, and package size. It is crucial to incorporate the NDC ID into medical claims. The ID guarantees precise accounting and reimbursement by distinguishing between drugs that may share the same Healthcare Common Procedure Coding System (HCPCS) or Current Procedural Terminology (CPT®) codes.
15. The deadline for filing has elapsed. Pay close attention to the time frame that is permissible. Each insurance provider establishes its policies. Occasionally, the deadline to submit a claim is as short as 30–90 days from the date of service. If not, the insurance company will reject the claim, making it impossible to bill the patient or file an appeal.

Top 5 Most Common Errors That Stand in the Way of a Clean Claim

1. Medical Coding Accuracy: Incorrect CPT codes can lead to immediate rejection of the claim. The CPT codes translate and codify the procedures involved and help insurance companies tie the knots together. The recent transition from ICD-9 to ICD-10 coding services further complicates this process.
2. Demographic Accuracy: This is collecting information about the patient at the front desk. As simple as it may sound, you’ll be surprised to see how things can sometimes go amiss. From capturing a patient’s name to getting every digit of the insurance number right, it is all sleet and thin ice.
3. Eligibility Assessment: It is sensible to first find out if a patient is eligible for insurance or not. This can wipe out a tremendous amount of rigmarole.
4. Claim Duplication: Claims are, at times, resubmitted. Submitting the same claim twice would result in the rejection of both claims. So, a potential clean claim can get rejected because of a talking clone.
5. Incorrect POS: There exists a unique 2-digit code for hospitals, nursing homes, emergency rooms, etc. This unique code must match the respective CPT code to avoid rejection on the grounds of an
6. Incorrect POS: There exists a unique 2-digit code for hospitals, nursing homes, emergency rooms, etc. This unique code must match the respective CPT code to avoid rejection on the grounds of an incorrect POS.

Best Practices to Reduce Claim Rejections

1. Proofreading and Re-proofreading: Speed can at times be an impediment to accuracy and precision. Most typographic errors are retained due to the lack of a third-party review. Having a second pair of eyes review the work can highlight certain errors you may be blind to. Proofreading it once and having it run by another person for a second opinion can help. It may take a few extra minutes, but what it could achieve would save a lot of repetitions in the long run.
2. Demographic Data from the Front Desk: The responsibility of this task will heavily rely on the front desk. After the capture and collection of accurate demographics, the transmission of the data to the billing department will be highly critical. If anything goes amiss here, the rest of the process that follows would be a complete waste of time and resources. It would be ideal for billing departments to work closely with the front desk and cross-check the details at each patient visit.
3. Verification of Eligibility: This is yet another important link to overarching denial management. Ideally, this is where we assess a patient’s eligibility. Normally, the billing software would verify this during the patient’s visit.
4. Insurance Company Validation: As mentioned earlier, this is one of those junctures where things can go awry on multiple accounts. A patient may have multiple insurances, and sending a claim to the wrong insurance will result in immediate rejection. So, a potential clean claim can get rejected because of a talking clone.
5. Insurance Requirements: Staying abreast of regulatory updates and information pertaining to the industry would be obligatory. Even minor changes can disrupt the entire process and collapse the system. Besides the regulatory changes in the industry, even carriers are known to make changes at times. So, it would make sense to stay on high vigil and be sensitive to any news related to the industry or insurance carriers.

Velan Healthcare Service: A Roadmap to Healthy Cash Flow and Successful Revenue Cycle Management

On the bright side, for firms that lack the technology and expertise in denial management services, there is always the option of outsourcing healthcare denial management services. Outsourcing your medical billing to denial management Services, such as Velan Healthcare Services, is an excellent option. With over a decade of experience and expertise in the domain, we’ve seen and taken on almost every possible challenge that comes along the way. Equipped with redundant infrastructure and working round the clock, we take it upon ourselves to ensure the delivery of not just results but also values.