The Medical Group Management Association (MGMA) has found that better performing medical practices average just 4% in claims denials in their medical billing. And yet, time and time again, practice and billing managers say they struggle with denials. Practice management and medical billing expert Elizabeth Woodcock says practices can reduce denials and more effectively manage the ones that still happen.
She offers a simple process to follow up on claims that are denied. The majority of denied claims (75%) can be resolved without an appeal.
This process is for what she calls “hard” denials where the claim is denied because of a mistake or inconsistency in the claim not an issue like coinsurance being due.
Her approach is simple. If there is a mistake, correct it and resend. If action is needed, investigate. Your investigation may include the following:
- Review insurance card (both sides)
- The payer membership database
- Contacting the patient directly
- Looking at supporting documents:
- Office notes, operative reports, etc.
- Proof of filing date(s)
- CPT® Manual
- Provider manual
- Payer reimbursement guidelines and policies
Be sure to use reminders or ticklers so that work on denials is done in a timely fashion. Otherwise, you could miss your window to resend the claim. Woodcock recommends setting up a protocol to ensure denials are managed and write-offs don’t happen automatically.
- Denials worked within 3-7 days
- Follow the individual payer’s process so you don’t get another denial for a duplicate claim
- Protocol for write-offs requires the manager to sign off and is a written policy.
In the event that you do need to make an appeal, follow these steps:
- Put it in writing. Maintain a library of appeal letters so you don’t have to recreate the wheel each time. Make sure it includes all research and backup along with the claim, patient, and details of service information. Be professional and state the facts.
- Use authoritative sources: Medical literature, specialty society information, national and local Medicare coverage determinations, CPT® manual, and the payer’s website and policy manual.
- Request a peer review by an expert in your specialty.
- Carbon copy the state insurance commissioner and medical director ( a list of insurance commissioners is available here www.naic.org/state_web_map.htm
For more tips from Elizabeth on managing denials, download the new guide 5 Simple Steps to Prevent and Manage Denials.