How to avoid Denials in your Medical Billing Services?

Medical billing denials are constant headaches hitting several healthcare providers' operational efficiency, revenue, and cash flows. Numbers clearly tell the story. Did you know that the industry benchmark for medical billing denial stands at 2% for hospitals?

In fact, the medical practices are experiencing medical billing denials at rates that range from 5 to 10%, with an average of 4% for the better performers. Some medical organizations even experienced the first billing denial rate as high as 15-20%! For such organizations, one in every five medical claims submission must be appealed or reworked. However, each 0072ework costs around $25 per claim, and usually, the success rates vary between 55 to 98% depending on the expertise and the capabilities of the denial management team.

When nothing works, write-offs can range between 1-5% of the net patient revenue. This indicates that in a 300-bed hospital, on average, 1% write-off means $2 to $3 million a year. That's quite a whopping amount for a medical organization.

The good news is that the medical practices can avoid the majority of billing denials. Undoubtedly, these can never be brought down to zero, but reducing them by even a fraction of a percentage can substantially impact the bottom line of your business. The best approach is to understand different causes of denials, pinpoint the common billing challenges, and initiate the steps to avoid them.

Track Each Claim

You have to ensure that none of your claims are getting lost in your practice management system. Track all the claims meticulously. If you find any discrepancy, you should implement a more comprehensive process to track the status of the claims through the entire revenue cycle.

In several cases, the claims slip through the cracks as they are not handled quickly by your team. You have to ensure that your coders are coding each patient encounter on the same day or, at most, one day later from the service date. Moreover, upgrade your technology to a system to make sure of the scrubs, submissions, and monitoring of the claims with minimal employee efforts.

Pinpoint the “Why” in your Claim Denials

Unless you clearly understand why your claims are getting denied, you can’t bring down your denial rates. Start reviewing all your claim denial notices from a defined time- say, two or six months and figure out associated reasons for such denials.

Usually, a few of the most common reasons for medical denials include incorrect registrations, verification, or identification of the patients or their treatment or diagnosis codes. The best part of these denials is that they can be traced back to the responsible person. Figure out the patterns and have a word with the employees who are responsible for the repetitive offense.

Follow Up in Time

Are you aware that only a small percentage of medical practices actually make an effort to follow up on the claim denials and resubmit or appeal the corrected claims? If you don’t fall under this subset, you are saving insurance payers money at your own cost!

Most denials can be resubmitted after correction within a given time slot that depends from payer to payer. Look for the window as per your major insurance payers and ensure that it never missed out. Better yet, make it your billing team's top priority to follow up on each denial case in 5-10 days to submit the corrected or appeal claims at the right time, if deemed appropriate.

Automate Eligibility Checking

Ineligibility is another major concern for denials and rejections for few medical practices. Yet, most medical practices still handle the eligibility checks of the patients in an unsophisticated and unstructured way. They often choose to make last-minute calls to the payers just ahead of the patient appointment or after the services have been rendered.

Neglecting the eligibility checks accounts for a disservice to your medical practice and patients. Instead, invest in a cost-effective software tool that can check the eligibility in an automated pre-scheduled manner. Alternatively, you can choose to outsource the verification and other revenue cycle procedures to a trusted and reputed medical billing service that can handle the task professionally and efficiently.

Revisit Your Medical Processes for EOBs & Remits

How much time do you take to incorporate the necessary information from the remits into your billing process? Do you still rely on the paper explanation of benefits (EOBs)? How long do they linger on your billing and coding team's desks before reconciling with your latest technology?

You can’t avoid a denial until you know its existence! If there are constant procedural delays, you miss out on the opportunities for timely claims re-submissions and follow-ups. Instead, it is the right time to switch to electronic EOBs and streamlining the remit management system so that you can eliminate human errors, thereby saving precious time.

Conclusion

Avoiding any of the reasons for denials occurrence is key for ensuring optimal insurance denial management in medical billing. But it takes a lot of effort for a busy medical practice to keep up with these latest medical billing procedures. The best alternative is to follow the best denial management tactics or partner with an experienced 24/7 Medical Billing Services team. They can often ensure better insurance denial management with up-to-date collections. Contact us today at +1-888-502-0537 to leverage our expertise and experience to transform your healthcare practice.