Reasons For Claim Denials And Their Solutions

According to the American Health Information Management Association (AHIMA), almost all cases of claim denials in healthcare can be prevented and by almost we mean 90%. This suggests that the majority of expenses incurred to re-submit denied claims or to compensate for un-resubmitted claims are unnecessary.

By incorporating effective claim denial prevention procedures, healthcare practices can ensure a steady cash flow, enhance productivity, minimize costs incurred in the process of collecting on every denied claim, and avoid incurring additional expenses in resubmission fees to insurance companies.

Time Taking Task

A significant majority of revenue cycle professionals, accounting for more than 75% of the group, have reported that managing claim denials is the most time-consuming task for their organization.

Denials Management, Prior Authorization, & RCM

According to a survey commissioned by healthcare operations company AKASA, healthcare financial leaders consider denials management and prior authorization to be the most time-consuming tasks in revenue cycle management.

A separate survey asked respondents about the most time-consuming revenue cycle tasks for their organizations. The results showed that over 76% of respondents identified claim denials management as the most time-consuming task. This process not only takes up a significant amount of providers’ time but can also be expensive and have a negative impact on the patient experience.

Following claim denials management and prior authorization, the survey conducted found that insurance follow-up was the second most time-consuming task.

Tips For Avoiding Medical Claim Denials & Getting Paid

Following billing guidelines can be a difficult and frustrating task, despite physicians’ best efforts to do so. Even after making a diligent effort to comply with these guidelines, healthcare providers may still face claim denials and have to deal with the recoupment of payments post-payment.

A coding guide published in the Medical Economics Journal in 2022 suggests that focusing on coding and documentation compliance may help physicians prevent claim denials and increase the likelihood of receiving payment.

A common reason for claim denials is the simple mistake of listing an incorrect patient status on a document. Physicians should avoid assuming that a patient is new to the entire practice just because they are new to them. It is possible that the patient had a telehealth appointment with another doctor at the practice the previous year, which would classify them as an established patient. To avoid claim denials, physicians should not make assumptions about a patient’s status and verify their status before submitting a claim.

Invalid medical codes are also a leading cause of medical claim denials. Not making mistakes in medical codes is a difficult task if the coder is not well experienced. For this, you can hire us as an urgent care medical billing service provider.