There’s been a whopping 20% increase in claim denials in the past five years. The global pandemic has only made this trend worse. The sudden spike in denials have put over 33% of Hospitals and Medical Practices in danger zone, creating massive pressure on especially independent Practices. This blog outlines the current state and addresses some of the key questions of Denial Management teams in hospitals and medical practices.

Dive in.

Top Denial Management Questions Answered

1. What is the state of medical billing claim denials in 2021?

Claim denials have hit record high! There has been a global surge in denial rates over the past year. These numbers capture the essence of the current trends that help device a comprehensive denial management strategy by considering various factors.

Average claim denial rates The average claim denial rates are between 6% and 3%	5 years trend There has been a 20% increase in claim denials in the past five years
2020 Report 23% increase in hospital claim denials	33% hospitals in danger zone Average claim denial rates at 10% as reported by 33% of hospitals in the face of the pandemic
Average claim denial rates at 10% as reported by 33% of hospitals in the face of the pandemic

2. What are the common reasons for claim denials?

The topmost reasons for claim denials as per the 2020 report includes the following factors.

• Registration/Eligibility
• Service not covered by Payer
• Duplicate claim or service
• Deductibles
• Payer behavior
• Case management
• Coding errors

While the above checklist gives an overview of the major causes of claim denials, it’s critical that healthcare systems delve into the details and take a more holistic approach—in order to achieve longlasting benefits.

3. How to perform a root-cause analysis for claim denials?

Root-cause analysis can be done for each segment of the revenue cycle process. Eligibility being the topmost reason for denials in healthcare—contributing to about 30% of the overall denials in medical billing—here’s how you can perform an in-depth analysis for eligibility denials. For instance, it may be due to the negligence of administrative staff in performing a thorough eligibility verification. To resolve this issue, you can verify the eligibility at regular intervals—once during online scheduling—three days prior to the doctor’s visit, then on the date of service, and again before submitting the claim. However, for emergency visits, patient eligibility verification needs to be handled differently at Point of Service—in a way that offers the best medical and financial advice on various care plans.

Reports suggest that claim denials could also be attributed to several other factors including—missing or invalid claims data (17.2%), pre-authorization/pre-certification (11.6%), service not covered (10.6%), medical necessity (6.6%) and so on.

4. Why automate denial management?

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. An automated framework helps relieve your staff from manual and time-intensive administrative tasks, which could be channeled towards focusing on high-risk accounts and other high-priority activities. Here’s how an automation solution simplifies your medical billing process.

• Comprehend the Denial Framework. Root-cause analysis tools including matched claim and remit are implemented to understand the common patterns of claim denials occurring frequently
• 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

5. How SolvEdge Denial Management Services can help you collect every dollar due?

At SolvEdge, we have designed our unique denial management programs to prevent denials, improve cash flow, and ultimately accelerate your revenue cycle performance. Our 4Clover Approach to Denial Management Services include Four Phases – 1.Analyze, 2.Strategize, 3.Discover and 4.Implement to ensure a holistic and a multidisciplinary approach to your revenue cycle process.

SolvEdge’s Assured ROI Promise

You Don’t Pay Us a Dime If… we don’t reduce your claim denial rates as promised. That’s how serious we are about your denials and prevention! But you “don’t have to bet us” on this. Here’s how you can take the challenge yourself!
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