Put Lost Revenue From Claim Denials in the Rearview Mirror

Crystal Ewing - ZirMedBy Crystal Ewing, Manager of Data Integrity, ZirMed
Twitter: @ZirMed

Historically, healthcare providers have often treated claim denials the way many of us treat a speeding ticket. We may not be quite sure how much we were actually speeding—we may even disagree that we were speeding at all—but we figure it’s easier to pay the fine and be done with it than go to court and fight the ticket.

In the case of claim denials, the analogous assumptions tend to fall into two camps: either the payer is probably right…or they aren’t, but it’s just not worth the time and effort to dispute it, especially with no guarantee of a favorable outcome.

In a previous blog post, my colleague Glenn Krauss talked about ways to avoid denials by taking more care on the front end—moving denial management efforts upstream in the revenue cycle. Still, no matter what you do as a healthcare organization, you’re bound to see some denials—so it’s crucial to have clear visibility into which denials are recoverable, and which of those recoverable denials are the most valuable.

Of course, one of the reasons some healthcare organizations don’t appeal denials is that the traditional, manual processes involved are so resource-intensive and time-consuming that it’s simply not worth the time and effort. But that’s a surmountable challenge – one that can be effectively addressed with the right combination of technology and cross-departmental collaboration.

Let’s look at a few key pieces of the puzzle.

Accelerating remits and converting EOBs
When it comes to working denials, there’s nothing worse than not having all the information you need. If remits aren’t in the system, or paper Explanations of Benefits (EOBs) are sitting on a desk somewhere waiting to be manually reconciled, you won’t know what you don’t know. You could end up waiting longer than needed to begin working a high-value denial. You could end up hunting for information only to discover the remit is lost in the ether—or you could give up and then find the remit you need months later, when the timely filing deadline is long past.

A better approach is to have all your remits visible in one place so that staff don’t have to waste time hunting them down. This is especially important to prevent high-dollar claims from slipping through cracks.

Paper EOBs present their own challenges. Paper can get lost, misplaced, drenched in coffee and rendered illegible, inadvertently stuck to another piece of paper, etc. Not to mention that manually keying in information increases the risk of human error.

Today, everyone who owns a smartphone walks around with more computing power than was used to land men on the moon. It’s time to take paper EOBs out of the equation with a solution that can automatically convert them into electronic remits. This saves time, reduces costs, improves accuracy and most importantly ensures you can take action on recoverable denials as quickly as possible.

Triage denials to focus effort where it will deliver the greatest benefit
So which denials are worth appealing—and which are a lost cause? Sadly, it’s far too easy to waste time and effort fighting denials where there is clearly no hope of winning. And worse, doing so takes time and resources away from those you can appeal successfully.

Just as the emergency department must triage patients based on care needs and resources available, revenue cycle departments must triage denials based on likelihood of successful appeal, bottom-line impact, cost to rework, and a host of other factors that are unique to each facility and payer.

Once you’ve eliminated the unwinnable, the next step is to look at which denials will have the greatest impact on your organization’s financial and overall performance. Of particular interest should be those that seem to come up often vs. those that may only surface periodically—but these must be considered holistically. For example, a $10K denial that occurs once a quarter will still have incrementally greater financial impact than a $200 denial that occurs (on average) four times a week. This type of examination can also be a source of insight for determining lines of service or payer contract (re)negotiations—yet another reason that full visibility is crucial.

Denials that come through regularly, especially those that are high-dollar, may be the result of a process problem. Rather than simply reworking and appealing, you’ll want to look for process improvements that address the root cause(s) – changes that will help you get paid faster with less effort. Analytics can be highly valuable in this undertaking, especially for large organizations with substantial claim volume.

Even if the denial doesn’t appear common at first glance, there may be commonalities across seemingly dissimilar denials that can be uncovered through data mining and other forms of analysis. These technologies can pinpoint changes to help prevent these types of denials from recurring—and can identify high-risk outliers that will be automatically flagged moving forward to keep your team ahead of the curve.

Once you understand the patterns and trends of your incoming denials, you can adjust your workflows to match staff expertise to specific payers or types of denials, effectively routing the right denial to the right person or team at the right time. This automation empowers your organization to act on denials much faster and succeed more often—and ultimately, ensures you recover more of the revenue you’re rightfully owed.

The ticket to success
Claims denials can cause undue stress and cost you significant money. But by knowing where the traps are, what really matters, and how to be your own best advocate, you can avoid the pain and put lost revenue in the rearview mirror.

This article was originally published on ZirMed and is republished here with permission.