Denials Management

What is Denial Management?

Medical billing denials management is nothing but it is the process of investigating, analysing, resolving, and preventing denied claims for medical services provided by a physician or other qualified healthcare professional. In a very simple word, it refers to the process of identifying, analysing, and resolving claim denials from insurance companies to ensure accurate reimbursement for healthcare services provided.

Healthcare professionals are sending medical claims to healthcare payers, like Medicare or commercial health insurances, for payment of medical procedures, services, or supplies. The payer adjudicates the claim in a timely manner. If there are no issues with the claim, the payer pays the contracted amount. When a claim is rejected or a denial occurs, however, the healthcare provider does not receive reimbursement for the medical care provided to the patient. Most common reason for denied claims include coding errors, duplicate claims, lack of medical necessity, patient eligibility issues, and insufficient documentation. Revenue

HIGH DENIAL RATE = LOWER REVENUE

This equation says everything. If any practice is having higher percentage of denied claim, then it considered poor practice health. This creates financial as well as mental pressure to providers. If the revenue is not coming in timely manner, then doctors are unable to pay 100 % focus on patient care.

When a claim is denied, the insurance company refuses to pay for the services rendered. For the provider, the financial impact of healthcare claim denials is loss or delay of payment and the additional cost of having to rework the claim. Too many denials will significantly hurt a healthcare providers’ revenue and their patient satisfaction. What will happen if the denial percentage is higher?

  • Delayed insurance payment
  • Higher write off percentage
  • Fluctuated monthly revenue
  • Increased administrative costs
  • Lost revenue
  • Cost of rework
  • Patient satisfaction

The denials management process in medical billing helps healthcare organizations ensure their medical providers are properly compensated for medical services, procedures, equipment, treatment, and care.

What are the key steps in denial management process?

1) Understand and identify denials:

First and foremost, step is to identify denied claims to work on. Usually, all the government and commercial insurances process claims within 30-45 days. So, we need to run a report of all outstanding claims and if its more than 45 days, we need to work on those claims on priority bases. Because, in most of the cases, those claims are rejected, pending for documentation, and/or denied. Now-a-days, most of the software allow us to generate and download denial report. This way, we can have the list of claims which are denied or potential denial.

2) Analyse and categorize denials:

Once the denied claims are identified, practice should divide them inro various category. There are some most common denial categories include coding and billing errors, eligibility related issues, credentialing problem, or lack of medical necessity. This type of practice helps to analyse the causes of denials as well as helps to identify patterns or trends to fix them from the route cause.a

3) Correct and resubmit claims:

It is important resolve the denial by taking appropriate actions. If we have appropriate solution for any of the denial, then practice needs to correct the same and need to resubmit according to payer rules and guidelines. Once we have categorized all the denials, it is become very easy to setup standard procedure to fix the denial. It helps to do 360-degree review before resubmit claim to the insurance company.

4) Appeal as and when required:

If a claim is denied, the provider must determine if the denial was appropriate and if the claim error was on the provider’s end, so they can correct and resubmit it for possible payment. However, an appeal is made if the denials specialist or biller disagrees with the payment decision made by the insurance companies. If the claim was submitted correctly and the insurance company should have reimbursed, the provider needs to submit an appeal.

5) Prevention of future denials:

The final and most important step in the denials management process is to use the information gathered to prevent future denials. This step involves:

  • Provide training to the billing staff on correct medical coding practices
  • Ask providers to keep the required information while creating Medical Records or notes.
  • Implementing better patient eligibility verification processes to prevent denials related to this category.
  • Set-up standard operating procedure (SOP) to use in case we received similar denial in future.
  • Setting up business rules to prevent coding and billing related denial.
  • Prepare category wise guidelines and improve co-ordination among other verticals of RCM.

Claim Adjudication process:

It includes various steps. Here is the basic understanding of claim adjudication.

Claim acceptance: In this step, insurance is bringing claims into their system from the either clearing house or mail box. Meaning claims are getting entered into their system.

Basic review: This is done Automatically based on predetermined business rules. In this step, insurance confirms, whether the claim is duplicate or not?  Whether or not all the required details are present for processing? Whether the patient is having active coverage on the claim date of service or not? Etc

Provider review: Here, insurance companies are checking provider’s participating status, whether provider under which claim is billed is in network with the patient plan or not? If the rendering provider is linked with the group or not?

Detail review: Where insurance determine whether the billed services are covered under patient plan benefits or not? They are checking based on the providers participating status as well. Whether or not authorization is required? PCP referral is required or not? Are the authorization or PCP referral valid for that date of service or not? Then, they also do coding review. Whether the billed dx-codes are valid or not? If the CPT code is correct or not? Required modifier is preset or not?

Outcome: (In this step they determine whether the claim is approved or denied.

What you will get if you outsource denial management service from Ingenious Outsourcing?

We think that denial management is the process of, Investigating, Analyzing, and Resolving denied claims. We have added one more aspect to this definition. Which is preventing future denials. Our denials team is highly knowledgeable and well experienced to tackle all sort of denials.

We believe in permanent solution.

While we are saying, we truly implemented this practice at our work place. Actually, we observed and analyze multiple Medical Billing organization and examine their method to tackle denials. As a result, we figure out that most of the time they are not looking to resolve the denial/s from its root. They are just fixing the one claim or may be single denial at a time. That type of practice leads Old AR, repeat denials, increase denial percentage, and multiple denials on single claim. Let us explain you in a brief. For example: claim was billed to Medicare and it was denied due to dx-code. What other companies are doing is just fixing the dx-code and resubmit the claim. Instead, our denial team is doing 360-degree review of each denied claims. We are not only fixing dx-code denial, but we also identify future possible denials. If dx-code changed to left side and original claim was billed without any modifier or with RT modifier then we are also changing Modifier/s accordingly. In addition, we also run a report for that same payer to identify similar claims which may be denied with same reason. And we then fix those claims as well. Afterwards, we setup guidelines as well as business rules to stop particular type of denials completely.

We are expert in resolving denials. We have divided denials into various category to see department vise performance. In addition to that, it allows us to see where the improvement is needed. We are not considering Denials management as a part of Account receivable. Off course, it is somehow related to it, but it required totally different strategies and dedication to tackle.

1) Billing related denials:

  • Incorrect CPT code
  • Incorrect Dx-code
  • Incorrect POS
  • Incorrect Modifier
  • Missing taxonomy code
  • Missing or Invalid Rendering / Billing / Referring provider
  • Duplicate claim
  • Missing CLIA certificate or number
  • Missing or invalid NDC number

2) Billing related denials:

  • Need Primary EOB
  • COB not updates
  • Other insurance is Primary (Medicare Advantage (MA) plan / Managed Care Organization (MCO) plan
  • Policy termed
  • Coverage not began
  • Not covered under patient plan

3) Authorization related denials:

  • Missing or Invalid Authorization
  • PCP referral is required
  • Authorization expired or exhausted

4) Credentialing related denials:

  • Provider is Out of Network (OON) with the insurance or patient plan
  • Provider is not enrolled with the insurance
  • Provider is not linked with the group
  • Need w9 form
  • Out of provider’s scope or specialty
  • Not covered under providers fee schedule

5) Miscellaneous denials:

  • Timely Filling Limit (TFL) is expired
  • Need Medical Records
  • Medical Necessity
  • Max Benefit reached
  • Not covered as per insurance fee schedule

We Ingenious Outsourcing created step by step guidelines to fix each of above-mentioned denials. This helps us to get effective resolution for the denials. There are certain skills required to tackle denied claims effectively and we made sure that each of our denial experts possess those skills. This includes following skills:

  • Knowledge of medical coding: In depth knowledge of HCPCS Level II, ICD-10-CM, and CPT codes and ensuring the codes support physician documentation will help prevent denials due to coding errors.
  • Understanding insurance policies: Denial experts in this field should understand different insurance policies, coverage details, and the reason why claims might be denied.
  • Analytical skills: The ability to analyse denial patterns and identify systemic issues is important for preventing future denials. This required to take accurate action to get reimbursement.
  • Communication skills: Strong written and verbal communication skills are essential. This is required while calling to the insurance companies for denied claims. In addition to that, it is useful skills while creating appeals for any incorrect denial.
  • Investigating: Detail investigation is required to fix the denial from its root cause. It also become essential when we decide to resubmit the claim with the corrections.
  • Problem-solving skills: The ability to solve problems and find solutions is important, especially when it comes to overturning denied claims.
  • Learning curiosity: If denial expert is curious enough to understand the entire revenue cycle, it helps them to address denials promptly and effectively.

We at Ingenious outsourcing arrange regular training sessions to improve skills of out denial experts. This way we achieve their personal and professional growth. We are having this type of skilled experts to manage your denials.

 

 

What are the benefits of having Ingenious outsourcing as your denial management partner?

  • Improved clean claims ration:
  • Increased net revenue:
  • Enhanced patient satisfactions:
  • Constant and non-fluctuated monthly revenue:
  • One touch resolution:
  • 48 hours TAT:
  • Monthly improvement report:
  • Experienced and skilled team members:
  • Structured SOP to tackle and prevent denials: