Claims denials happen throughout the revenue cycle, but often their origins are at the very beginning, the moment a patient seeks treatment.
What’s driving the denials?
According to the Journal of Healthcare Information Management, 86 percent of healthcare industry mistakes are administrative[i]. It’s not surprising when you consider the volume of paperwork faced by front-office staff, and what in many organizations is still a heavily manual workflow.
The Technology CEO Council found that patient charts cannot be found on 30 percent of patient visits[ii]. Without this vital information, basic patient data and benefit eligibility information are missing, leading to claims mistakes and denials.
Unfortunately, eligibility questions aren’t the only problem. In order for claims to be accepted and paid promptly, they must legible, accurate and complete – a tall order considering the number and complexity of diagnostic codes and the pace of regulatory changes.
Denials cost more than you think.
Trying to recover lost revenue can be a lengthy and expensive process, but worth the effort for providers. In the second quarter of 2016, the average automated claim denial from Medicare’s Recovery Audit Program was worth $714. And complex denials that required medical record review averaged $5,418[iii], according to the American Hospital Association.
With so much at stake, preventing mistakes from happening in the first place and avoiding denied claims is the best approach. But how? First, identify the real reason claims are denied:
People make mistakes.
We are human, and sometimes we make mistakes, no matter how good we are at our jobs, or how great we are as people. When you mix our humanity with a very complex healthcare system that is constantly changing — it’s no wonder errors happen. But it doesn’t excuse us from seeking a better way to complete this process.
It’s an easy fix.
Here’s the good news: most revenue lost along the revenue cycle is preventable through automation. And the majority of claims that are denied don’t have to be.
An automated system with a built-in claims scrubber, custom business rules and pre-submission eligibility checks can help ensure the cleanest claims possible. It can also keep up with current diagnostic codes so your staff doesn’t have to.
Imagine having a first-pass acceptance rate of 98 percent. It’s possible with ABILITY EASE® All-Payer, a software application that also helps eliminate the administrative burden of submitting secondary claims.
When it comes to revenue cycle management, it really pays to do it right the first time. Advanced technology makes it possible.
[i] Journal of Healthcare Information Management, Volume 17, Number 1, Winter 2003, https://www.himss.org/jhim/archive/volume-17-number-1-2003.
[ii] Technology CEO Council, A Healthy System Report, 2006, http://www.techceocouncil.org/clientuploads/reports/A_Healthy_System_Final.pdf.
[iii] Jacqueline LaPointe, Hospitals Still Facing Medicare Claims Denial Management Issues, October 17, 2016, https://revcycleintelligence.com/news/hospitals-still-facing-medicare-claims-denial-management-issues.
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