Importance of Claim Denial Management Audits for Your Practice’s Revenue
It is no secret that claims denials are something that you are going to face at your practice. The importance of claim denial tracking cannot be highlighted enough. This is because the success of your practice depends on the revenue, and the status of your practice’s revenue is positively affected by a significant reduction in claim denials. Reducing claim denials proves to be a challenge because of the complex and tedious nature of the claim submission process. Moreover, it requires constant follow up that your staff may not be able to do, due to time and energy constraints. Regardless of that, it is crucial to get a handle on claim denials, especially if they are the reason for reduced payments that are costing your practice a huge chunk of the profit.
There are various different reasons as to why payers may deny or reject your claim ranging from inaccurate patient data, and wrong diagnosis or coding, to noncovered services and late submission. They are all discussed below, in detail. However, it is not enough to know the general causes for proper management of claim denials at your practice.
Common reasons for claim denials
Denial management is meant to help you analyse where your practice lies when it comes to the submission of claims and addressing denials. Some of the common causes for your claim denials are mentioned below, however, it is not necessary for them to be present. Only prospective audits can help determine the most common causes of claim denials at your practice.
- Lack of insurance eligibility
- Filing multiple duplicate claims
- Late claim submission
- Medical Necessity not verified or sufficient
- Resubmission of Adjudicated claim
Each practice is unique and will have its own problems with denials. It is important for your practice to participate in active claim denial management collectively with medical, administrative, and business teams to evaluate the status of your practice and fix the cracks as they appear.
Claim denial management is crucial for increased profits and a revenue boost at your practice as it targets and resolves issues that are causing unpaid claims. Apart from the very obvious benefit of audits and reduced denials, some of the other benefits of the process are decreased billing compliance problems, bad debt collection, along with a significant reduction in man hours and manpower spent on denials.
What is a claim denial management?
Claim denial management is a thorough process of identifying the problems at your practice and targeting them to effectively solve these issues. It is an important step for your practice as unmasking issues related to claims submission can be just what your practice needs to turn around its revenue cycle management and reduce unpaid claims.
Claim denial management includes four key steps; Identify, Manage, Monitor, and Prevent. One of the ways your practice can stay on track of claim denial management is by performing prospective or compliance audits. Audits are generally a process that is performed with the purpose of assessing patient care at a practice. While these are excellent sources of determining the causes of decreased patient retention and engagement, they are not the audits being discussed here. They are a crucial part of running a successful practice and are involved, to an extent, in the denial audits mentioned here.
Claim denial management audits are performed on both, claims that are already paid, denied, or rejected and the claims that are yet to be submitted. The prospective audit focuses on new claims, right before they are submitted. The purpose of these audits is to have a professional go through the claim, checking for errors related to patient information, medical coding, and so on. This is to ensure that there are no errors present that can lead to claim denial. However, it is not possible for someone to go over every single claim that your practice submits, especially since there is a time limit for submitting these claims.
Retrospective audit focuses on past claims that are already paid, or denied, to assess the reason behind the denials. This helps narrow down the recurring theme of claim denials to a few specific causes such as code compliance or credentialing mistakes. Information from these can then be used by auditors performing prospective audits.
Prospective audits assess the current claims that are yet to be submitted in an effort to prevent errors that were found to be the most common reasons for claim denials during retrospective audits. Despite shortlisting the flaws that one needs to focus on, this can be quite difficult for an auditor to do at your practice, purely because of the time, training, and energy required. This is exactly why it is highly recommended to get professional help and maybe, even automated help.
How Practolytics can help with compliance audits?
Practolytics keeps the main goal of the improved RCM cycle in mind, regardless of which task it is focusing on. To target the issue of claim denials and how that affects the revenue at your practice, Practolytics provides code compliance audits performed by professionals as a solution. The audits are performed with the help of state-of-the-art technologies and analytic tools to ensure an error-free analysis of compliance at your practice.
Practolytics will thoroughly assess all claims, current and past, during these audits to identify problem areas and specific issues that are causing denials. A significant part of the audit is also checking for code compliance in your region to ensure proper coding and utmost accuracy. Once the issues have been identified, the next step is to check modifier usage correctness to not only correct the claims but also guarantee that the recognized errors are taken forward for a corrective approach for future denial prevention.
At the end of the audit, you will receive a detailed compliance report highlighting compliance issues that are causing denials. You will also be entitled to free training for your staff on how to avoid these issues in the future and how modifiers are to be used. Frequent compliance training programs are recommended for your staff to increase revenue at your practice. Talk to our experts at Practolytics for a comprehensive solution on how to address claim denials and take a preventive approach rather than a corrective approach.