Managing Denials in the Revenue Cycle

By Brad Josephson, Director of Marketing and Communications, PMMC
Twitter: @PMMC_Online

Aspects from Managed Care Directors to CFO’s

Recently, there’s been a huge amount of attention paid toward analytics and the type of information it can provide to all levels of management in the healthcare revenue cycle.

This is due in large part to the numerous benefits it can provide for gaining a clearer insight into your denial management performance through the use of data visualization, which needs to be driven by accurate data.

Aside from the obvious advantage of turning raw data into visual presentations, leveraging data visualization provides a much wider range of benefits to everyone in your organization. These benefits include:

  • Easily grasp and absorb more information
  • Discover relationships and patterns
  • Identify emerging trends faster
  • Directly interact with data

From gaining insight into your overall denial trends to highlighting which denial categories drive the most collections, analytics provides hospitals with a wide array of visualization tools that allow them to detect current and potentially future trends that impact revenue.

Analytics accomplishes this by incorporating performance measurements and enables users to view & understand vast amounts of complex information regarding operational and business conditions.

But, with this surplus of new information comes its own set of challenges.

Often times, the biggest obstacle is accurately sorting out all the data so it can be analyzed visually and reported back to higher-level management personnel.

But let’s be realistic, most C-Suite and Managed Care/Revenue Cycle professionals don’t have time to dig deep into the data and quickly pull out clear and actionable results, so it’s up to denial management team members to know which data points are most pertinent to their concerns and be able to present those results in a concise and accurate manner.

But it’s not that simple.

Before you can assess the significance of the results, there needs to be a system in place for ensuring accuracy throughout all of your data. While visualization is a great tool for interpreting results, it would be rendered useless without accurate data to back it up.

Think of it like writing a long college essay. You can make all these points on the topic and include your own theories on why it happened, but if your solution is not backed up by a reliable source, then the reader has little reason to assume the information is credible.

To get started, many providers have turned to contract governance as means for establishing a foundation based off performance measurement. Not only does this ensure that your organization’s entire revenue cycle management (RCM) is based off of accuracy, but, in the bigger picture, it provides additional support from the back-end to improve front-end processes (such as patient registration and QA).

Taking into account the entire payer claims dataset being processed daily, how is a denial management team expected to provide the most relevant information to their CFO without understanding the impact that denials are having on their organization’s bottom line??

Here’s a cheat sheet with a list of questions that all Managed Care and C-Suite want to know:

Managed Care (Director-level):

  • Which categories are giving me the most denials?
  • What are the trends for categories giving me the most denials?
  • What are the top two denial codes per category?
  • Which categories and subsequent denial codes are giving me the most denials?


  • Are my denial rates growing?
  • What are the volumes in both dollars and count?
  • Are we getting paid on denials?
  • What denial categories are causing denials?
  • What payers are causing denials?
  • What are the top two payer denial details?

Of course, each organization is different and has their own set of unique payer and reimbursement challenges, but these questions touch on major themes that upper-level management is always looking to improve.

In order for this process to work seamlessly, however, each person needs to not only understand the responsibilities associated with their own role, but, more importantly, they need to understand the impact their role plays on maintaining the entire revenue cycle.

While the day-to-day task of a denial analyst is to work individual accounts to overturn denials to bring money back to the hospital, Managed Care and CFO’s are in strategic roles that require a big picture understanding of denials and overall payer performance. Data visualization fills this need and more – it’s a powerful tool to make quick, informed business decisions.

By adding accurate back-end revenue cycle analytics, an organization is better positioned to prevent future denials and, ultimately, increase their bottom-line.