Effective denial management is necessary for the financial success of any medical practice. Each step of denial management is crucial, including denial analysis, claim prioritization, denied claim resolutions, and follow-up. Methodical claim rejection analysis and execution of resolutions will help you achieve high success rates. These steps contribute to revenue loss mitigation and functional efficiency improvement. In addition, strategies like pre-authorization, credentialing, and contract review are also essential for reducing denials and lifting revenue. In this article, we dive into essential steps to refine the denial management process and secure your practice’s financial health.
1. Monitor Timely Filing Deadlines
Monitoring timely filing deadlines is key to stopping timely-filling (TFL) denials. Late claim releases contribute significantly to denied claims, with estimates ranging from 15% to 30% on average. Medicaid plans, managed Medicaid organizations (MCOs), and some commercial HMOs have shorter filing deadlines and require timely billing.
Prioritizing billing for payers with low TFL limits while efficiently managing missing information is crucial to minimizing timely-filling denials. You can reduce claim denials and increase revenue by staying informed about payer deadlines and timely responding to missing information.
2. Appeal-Denied Claims for Resolution
Studies indicate that providers reverse over 50% of appealed claims, stressing the critical role of appeals. To effectively appeal denied claims, you must develop a robust appeals resolution process. Reviewing LCD, NCD guidelines, and insurance payer policies thoroughly is essential to understanding appeal rights thoroughly. Crafting appeal letters that clearly explain why the denial should be annulled with the supporting documents is a crucial step in the appeals process.
When turning in appeals, sticking to payer guidelines is crucial to meeting payer compliance and increasing the likelihood of success. Expediting the appeal to higher levels, like Level II, III, and IV, based on initial appeal decisions further aids resolution. Implementing a structured appeals process and using payer guidelines effectively can improve the chances of overturning the denials. These measures can help increase revenue capture through appeals.
3. Implement Pre-Authorization
Implementing pre-authorization processes for services and procedures is a step for proactive denial management. This helps to prevent denials at the pre-billing stage. Studies show that pre-authorizations can reduce denial rates by 20%–30%. It’s crucial to initiate the pre-authorization process well in advance of the scheduled service or procedure to ensure timely approval. This is one of the processes that has potential for automation.
Some payers may allow retro-authorization requests if the pre-authorization is missed. In cases where pre-authorization wasn’t secured before the service and retro-authorization is not available, certain payers may still accept medical records as evidence of service to adjudicate the claims. Implementing efficient pre-authorization processes is essential to increasing opportunities for revenue loss mitigation.
4. Credentialing & Contracting
When it comes to overturning denials, tracking issues related to credentialing and contracting is crucial. Many claims are denied due to reasons linked to enrollment, such as services being considered non-covered, out-of-network, or lacking pre-authorization. However, the underlying cause of these denials often stems from credentialing and contracting issues. It’s important to note that not all insurance payers will consider submitting your first claim as an application for enrollment in out-of-network benefits, especially in the independent lab billing setup.
Payers follow specific processes to enroll as an out-of-network provider. Failure to complete the credentialing and contracting process can result in claim denials and significant revenue loss. Therefore, making sure that you are properly credentialed with all payers and have appropriate contracts in place is essential for denial management and increasing reimbursement. Regular review of claim rejection analysis and revisiting your credentials and contracting status can help minimize the risk of denials and ensure smooth claim processing.
5. Denial Management through Contract and Fee Schedule Review
Regularly reviewing payer contracts and fee schedules is essential for ensuring alignment with current billing practices and reimbursement rates, a measure that can significantly reduce claim denials. Contract discrepancies contribute to approximately 5%–10% of claim denials, highlighting the importance of staying vigilant in contract management. By closely examining payer contracts and fee schedules, healthcare organizations can identify any inconsistencies or outdated information that may lead to denials.
This proactive approach allows organizations to address discrepancies promptly, negotiate favorable terms where necessary, and ensure accurate reimbursement for services rendered. Additionally, staying informed about changes in payer policies and fee schedules enables organizations to adapt their billing practices accordingly, minimizing the risk of denials and optimizing revenue loss mitigation. Regular contract and fee schedule reviews are crucial components of a comprehensive denial management strategy to help you maximize revenue capture and mitigate financial risks.
6. Streamline Medical Documentation
When it comes to overturning denials, the importance of accurate and comprehensive documentation cannot be overstated. Industry studies indicate that incomplete or inadequate documentation accounts for a significant portion of claim denials, ranging from 20% to 30%. In addition to leading to claim denials, incomplete medical documentation can also pose audit risks and result in duplication of work for providers. Therefore, streamlining documentation processes is essential for improving claim acceptance rates and reducing the likelihood of denials.
Utilizing electronic health records (EHRs) and documentation templates can help standardize documentation practices and ensure that all necessary information is captured. Moreover, providing thorough and detailed documentation can also strengthen appeals resolution in cases where claims are denied. By prioritizing accurate documentation, you can enhance the efficiency of your revenue cycle management processes and ultimately maximize revenue capture.
7. Use Denial Management reporting for Denial Trends
Identifying denial trends is crucial for effectively overturning denials and improving revenue cycle management processes. Recent surveys suggest that up to 90% of denials are preventable through claim rejection analysis and early intervention. By examining denial data, you can uncover common trends and root causes that contribute to claim denials. This includes claim rejection analysis at the payer level, CPT level, or even panel level, allowing you to pinpoint specific areas for improvement.
For example, certain denials, such as the benefit maximum reached, may fluctuate based on the calendar or specific plan limitations. By understanding these trends, you can proactively address issues and implement targeted strategies to reduce denials and enhance revenue capture. Utilizing advanced analytics tools and reporting capabilities can streamline the analysis process and provide actionable insights for revenue loss mitigation.
Initiate Denial Management with Invent HealthMatics
Unlock the potential of denial management with Invent HealthMatics. Benefit from our extensive experience and expertise in denial management solutions. Partnering with us can significantly increase your denial success rate. Let our proven strategies and industry-leading insights optimize your denial management process. With our tailored approach and comprehensive support, we’ll help you overcome denial challenges and maximize revenue recovery. Don’t let denials hinder your financial success. Trust in our solutions to streamline your denial management workflow and achieve greater efficiency. Join forces with us and take control of your denial management process today!
