A medical billing denial occurs when the insurance company refuses to honor the request to pay for the healthcare services provided by a healthcare professional. Medical billing denial is a serious matter as it has a negative impact on the healthcare provider’s cash flow, revenue cycle and operational efficiency. The rate of medical billing denials is usually between 5% and 10%. If you are the best in medical billing jobs, then this rate is around 4%. Medical billing denials can always be avoided and reduced with care and a reduction in medical billing denials improves the revenue cycle of the healthcare facility. To avoid denials, you should first understand the common medical billing denials and then you can take remedial action for the denials.
Common medical billing denials:
- Information is missing: Any information that is missing, any code that is missing or incorrect code, any wrong information or missing information regarding the social security number may lead to the claim denial. These kinds of denials account for more than 60% denials.
- Duplicate claim: Claims that are submitted again for the same service provided on the same date by the same provider and for the same patient are duplicate claims.
- Adjudicated services: Denials may happen when benefits for a service are already included in the payment for another service that has been settled.
- Charges not covered: The services that are charged in the claim may not be covered by the insurer under the benefit plan.
- Filing limits: Most insurance payers have directives that the claims are to be submitted within a time frame for the services provided. If this time limit is not met and claims are submitted beyond the specified time, then the claim may be denied. People in medical billing jobs should have alerts in place to avoid filing claims beyond the time limit.
Though denied claims can be worked upon later, avoiding denials should be the priority for healthy revenue cycle of the healthcare provider. Let us see how we can prevent medical billing claims.
- Categorize denials: You should be able to quantify and categorize the denials by tracking them on the basis of doctor, specialty, treatment and insurance payer. For this, you can rely on technology and data analytics and they prove to be worthy of time and money invested.
- Create team: Create a team that is responsible to analyze denials and identify what kinds of resources are required to get solutions.
- Improve data quality: All the healthcare facility staff that deal with patient data must ensure that the services being provided to the patient are covered by the patient insurance. The staff should also be cautious while recording patient details as any small error in these details may lead to denials that cause a lot of time and money waste.
- Check coding processes: If the denials are arising as a result of insufficient medical necessity, you should check where the problem is and bring in necessary processes to prevent such denials.
- Don’t neglect pre-authorization: Neglecting to perform pre-authorization processes may affect your revenue cycle very badly. It is always better to get pre-authorization for a treatment or procedure rather than getting it authorized after performing the procedure.
- Never miss deadlines: It should be your priority to submit claims and follow up on these claims within the stipulated deadlines.
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