Incorrectly Working Denials: 3 ways your revenue cycle staff may be hiding problems
Denied claims are inevitable. This fact enhances the need for processes that will lead to effective and efficient denial management. There are many reasons a denial may be resolved incorrectly, leading to an additional denial, delayed payment, or an unpaid claim altogether.
Here are three ways these denials can be hidden without notice:
1. Rebilling claims without correcting the issue and/or placing claims on hold.
These claims are not resolved before rebilling. When rebilling claims, you must ensure that they are accurate and complete, or you will simply generate another denial. Many facilities pay attention only to the number of accounts that are touched; however, the follow-up may not have addressed the true issue to get the claim paid. Prioritizing quantity over quality in your denial management program will not generate a high percentage of success. In addition to rebilling without correction, claims also must not be placed on hold. By running the Discharged not Final Billed (DNFB) report, you can detect inefficiencies that are leading to claims being placed on hold. Accounts Receivables that are more than 90 days due will also indicate inefficiencies in claim submission, and that information is missing or inaccurate.
2. Writing off denials as non-covered or a contractual adjustment.
If denials are not being tracked properly, they could be masked as contractual adjustments or non-covered charges. The key to prevention, or at least alleviating the damage claims denials can do to the bottom line, is knowing why claims are denied and how to resolve them. Denial codes fall into four categories: contractual obligations (CO), other adjustments (OA), payer-initiated reductions (PI), and patient responsibility (PR). The staff that is responsible for working your denials must have a detailed understanding of these 4 denial categories, along with the appropriate action for denials within the categories. The preferred outcome for any submitted claim is receipt of payment, and their expertise is critical in turning denied claims into paid claims.
3. Accepting Payer’s Description of Denial as Final
Be persistent with payers. If a resubmitted claim is denied and you believe the denial was inappropriate, you should appeal the decision according to the carrier’s guidelines. Your persistence can demonstrate to the insurance company that you are serious about resolving the problem and getting paid. By making certain that your billing procedures are consistent with the payer’s requirements, you may also be able to reduce the quantity of rejections and denials in the future. However, if you continue to encounter reimbursement problems with a particular insurance company, you can always contact your state insurance commissioner’s office for assistance.
While these are only three ways denials can be hidden, there are many others. Claim Submission denials, Write-Offs and Payer Denials are just scratching the surface. Regular audits of “resolved” denials should occur in order to determine the quality of your denial management processes.
Written By: Melanie McGivney, CHFP, CRCR, RH-CBS, CAH-CBS
LinkedIn: Melanie McGivney
