Healthcare organization can choose to improve their payments by making sure that their medical billing processes regarding claim submission and denials reflect three main practices such as:
- Identifying the root causes for claim denials and creating proactive processes or checklists to avoid them
- Training your administrative, front office, medical billing and coding staff at every step of the way to record and provide correct patient billing information and ensure 100% accurate claim submission
- Making good judgments and smart negotiations for the resolution of claim denials
Keeping trace and track of claim denials from the root or front end can help healthcare organizations and private practice owners to reduce their claim denials and have success in proactive denial management.
Despite the integration of top-notch medical billing software and platforms, claim denials can easily decrease your revenue and payments. According to research regarding denial rates conducted in 2017; $262 billion out of $3trillion were denied in total claims submission by healthcare organizations, translating $5 million in denials per provider on average. Providers generally do nothing at all to address the issue for denied claims. Approximately, 65% of denied claims are never resubmitted due to effort or time concerns. Healthcare organizations and private practice owners are still looking to tackle the problem which is growing at an alarming rate.
There are some ramifications of claim denials for example; an increase in the number of days in account receivables (A/R management), an increase in cancellation fees or collection costs and stagnant cash flow. But there are undesirable consequences as well like decreased productivity standards for too long that it is perceived as unattainable. Different work teams including billing, coding, administrative, health information management (HIM), or the front office may argue among themselves to hold anyone responsible for the denials. Supervisors and managers could employ more staff although not necessary for the given situation and ultimately the employee morale may fall at some point.
Proactive Denial Management in Medical Billing
Instead of pointing fingers, teams should work together and collaborate to identify the root causes of claim denials. Private practice owners cannot invest their time to try and identify the root causes and then try to manage and avoid claim denials in order to protect their revenue. Outsource medical billing companies have expert medical billing teams, who help to mitigate claim denials so that the problem can be reversed. To effectively avoid and manage claim denials, it requires corrective actions at every point in the revenue cycle management.
Revenue Cycle Management and its Processes
It is important to mitigate denial risks from the beginning of the medical billing process till the end which involves appointment scheduling, taking correct and accurate patient information, accessibility, HIM, charge capture, billing and coding process, and collections. Communications between the back and front ends of the entire revenue cycle management process must accurately be done, as poor communications may increase the potential risk for claim denials. It is crucial to pay special attention to documentation and the medical coding process as it can increase the likelihood of an approved medical claim. It is useful to explore and consider key elements and proactively management them which are root causes, appeals, and prevention of claim denials. It is also necessary to correct the hidden causes of denials such as:
- Multiple disjointed systems and processes
- Extra workflows which cause inefficiencies
- Unnecessary EHR system upgrades, merges or changes
- Backlog in A/R
- Denials piling up due to insufficient IT systems
- Inaccurate or incomplete claim submissions
Private practice owners and healthcare organizations must understand that it takes an expert to do an expert job. With GreenSense Billing, we understand that to avoid and manage claim denials, it requires significant effort to address the root causes and then develop a proactive prevention program that doesn’t overburden teams and successfully manage and resolve denied claims.