By DeVry University
September 21, 2023
6 min read
September 21, 2023
6 min read
In the healthcare revenue cycle, the timely and efficient management of health insurance claim denials is crucial. A claim denial is issued when a payer, such as a health insurance company or Medicare, declines a healthcare provider’s request to be reimbursed for their services. Regardless of the reason, a claim denial can mean a delay or loss in revenue to a hospital, diagnostic center or other provider, restricting cash flow and hampering the provider’s ability to operate efficiently. This makes denial management an important aspect of healthcare administration and a reminder of the importance of accuracy in medical billing and coding.
In this article, we will describe how denial management works, examine the different types of claims denials and look at some of the strategies healthcare providers and their medical billers and coders can use to reduce or prevent them.
Route denials directly: All coding-related denials should be routed to the provider’s coders so that each item can be acted upon quickly. Automated tools can be used to route denied transactions directly into worklists, thereby organizing and streamlining the paperwork.
Sort the work: The Denial Management Team can use software tools to sort worklists by amount, time, reason for denial and other qualifiers, making the process more efficient than it might be with manual systems.
Create standardized workflows: A standard action can be created for each type of denial by notating the facility’s most common reason for denials, identifying the most frequently used code corresponding to that denial and formulating an action plan for the management of similar denials.
Use a checklist: The process can be made systematic and as error-free as possible with the use of a checklist of do’s and don’ts to help avoid common mistakes that cause denials to become stagnant.
Missing or incorrect patient information: This could include something as simple as an error in the patient’s date of birth or the date the care was provided.
Coding errors: An incorrect code, like a procedure for infants billed for an adult patient, can trigger a claim denial. This is why accurate medical billing and coding is so important in healthcare.
Missing the payer’s deadline: Untimely filing, or missing the deadline established by the payer, can also lead to claim denial.
Duplicate claims: Claims for multiple instances of services or procedures can be interpreted as duplicate claims, especially if an appropriate code modifier isn’t used to indicate the claim is not a duplicate.
Missing authorization: Insurers typically require pre-authorization for medical procedures, including various surgeries. If prior authorization was not obtained, the payer is likely to deny the claim for the non-authorized procedure.
Dual coverage issues: When two forms of health insurance coverage apply, as in an injured patient who has both primary insurance and worker’s compensation, the claims process can be complicated, especially if there is a dispute with one or both insurers.
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In New York, DeVry University operates as DeVry College of New York. DeVry University is accredited by The Higher Learning Commission (HLC), www.hlcommission.org. The University’s Keller Graduate School of Management is included in this accreditation. DeVry is certified to operate by the State Council of Higher Education for Virginia. Arlington Campus: 1400 Crystal Dr., Ste. 120, Arlington, VA 22202. DeVry University is authorized for operation as a postsecondary educational institution by the Tennessee Higher Education Commission, www.tn.gov/thec. Lisle Campus: 4225 Naperville Rd, Suite 400, Lisle, IL 60532. Unresolved complaints may be reported to the Illinois Board of Higher Education through the online compliant system https://complaints.ibhe.org/. View DeVry University’s complaint process https://www.devry.edu/compliance/student-complaint-procedure.html Program availability varies by location. In site-based programs, students will be required to take a substantial amount of coursework online to complete their program.
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