Automating Your Way to Denial Prevention and Denial Management in Healthcare
- SolvEdge
- Aug 19, 2021
- 4 mins read
A robust denial management strategy is essential in improving the efficiencies of your revcycle. Understandable, healthcare organizations are taking stringent measures like reducing operational costs to mitigate the financial impact of the public health emergency. However, driving down costs may hurt organizational efficiencies in the long run.
A comprehensive approach to claims management involves a dedicated team, efficient processes, and automation of several workflows to prevent denials from the ground up. Setting your sights on long-term goals ensures that your revenue recovery process can bring sustainable changes that optimize your revenue cycle process, enabling you to lead the way through the crisis time.
The State of Claim Denials and the Financial Impact
Claim denials have hit an all-time high! And this trend is only getting worse. There has been a global surge in denial rates over the past year.
23% increase in claim denials in 2020 compared to 4 years ago
33% of Healthcare organizations are nearing the “danger zone” with an average denial rate of 10%
Reworking claims alone cost 20% of the overall revcycle operational costs with an average claims rework cost of $25 per claim
A Medical Practice that reworks and resubmits 100 claims a month alone spends a whopping $37,000 a year
Even worse—the revenue potential of 65% of denied claims not resubmitted is lost
The sudden spike in denials has put Hospitals and Medical Practices in the danger zone, creating enormous pressure on especially independent Practices. This financial strain is pushing them to seek out for nimble solutions to reduce and prevent denials. However, the good news is that 90% of claim denials are preventable! Achieving sustainable financial results requires a strategic blend of the root-cause analysis and automation of several processes that make denial management process a breeze!
10 Root Causes of Claim Denials
Denial Automation
Many healthcare organizations rely on manual methodologies to manage and prevent denials. However, the partial automation of processes plays a significant role in mitigating costs and improving operational efficiencies. An average person spends about 18 minutes to sift through medical records to find the exact information needed, while it takes less than two seconds through automated solutions. Analytics and AI-powered solutions relieve your staff from timeintensive administrative tasks, helping them better focus on high-risk accounts and other highpriority activities.
Unlocking Potential by Automating Low-impact, High-volume Denials
Automation can transform your denial management process in significant ways.
Eliminate duplicate denials when denial and payment is received on the same day
Prevent denials due to non-coverage by identifying them at the first instance
Automatically transferring account balances to the right person
An Efficient Automated Denial Management Framework
A well-organized denial management team establishes a strategic workflow by integrating analytics and automation solutions to prevent denials.
Comprehend the Denial Framework. Root cause analysis tools including matched claim and remit are implemented to understand the denial patterns and identify the nuances of the common denial reasons.
Gather Denial Appeals Information. The denial management service team collects critical
data on denial appeals to determine the core issues. A predictive report is also established on the outcome of the denial appeals process.
Real-time Reports. AI and analytics-driven insights are integrated to generate real-time, accurate reports that provide actionable insights to the management. These insights help take proactive measures to manage denials effectively.
Track Progress of Denials Appeals. Automated appeals populate customized appeal letters in batches to facilitate reimbursements. File appeals are also done within a week of denial to ensure timely and accurate reimbursements.
Segmenting the Denials. Denials in medical billing happens for various reasons. The medical billing service team leverages automation capabilities to organize and prioritize efforts based on value, effort and propensity of payment.
Restructure Workflows. The denial management service experts map denials with specific categories as per Physicians, Payers, CPT codes etc. Once the denial patterns are mapped to the denial numbers, they strategize new process improvements to proactively address future concerns.
To learn more about how denial automation can help your healthcare organization accelerate the revenue cycle performance,
give us a shout!
