Sometimes it’s good to take the road less traveled by and dare the risk, but not when it can negatively affect your financial potential. So let us clear the path for you.
“Documentation does not support inpatient level of care.” Unfortunately, this is an alert that has probably become all too familiar to many of you as claims denials are a rising concern and issue for hospitals, health systems, and physician practices across the United States.
The resubmittal process is tedious and complex, deterring many healthcare professionals from even attempting it, losing out on large amounts of financial revenue every year. In addition, if you decide to tackle the claims resubmittal beast, your team gets tied up in lengthy administrative processes, losing valuable time that you and your staff should be spending with your patients. And when a patient encounter results in a claim that gets denied, nobody in the practice is left untouched; coding, patient access, utilization management, managed care, revenue cycle, clinical documentation improvement, health information management, legal, compliance, to name a few.
So, how can we fix this? It is essential to first get to the root of the problem. And to properly do so, it’s important to be aware of the different trends and variables affecting how we do business and what commonalities exist amongst all providers facing these challenges.
Three emerging trends to take note of that are a concern amongst providers.
- Clinical validation – We’re seeing an increase in clinical validation denials based on a combination of clinical indicators and coding references by the payor.
- Payor targets – Payors tend to focus on 10 to 12 diagnoses. Using data analytics to identify the diagnoses that show the highest denial rates and revenue risks builds a strong foundation for proactive denial prevention and appeal strategy.
- Managed care contracts – Organizations are increasingly focused on how diagnoses are defined in managed care contracts and their impact on payer denials. Sharecare uses denial data to identify root causes — reason, issue, and where the problem stems from. Claim Adjustment Reason Codes (CARC) are used to communicate the basis for a payment adjustment, e.g., Why was a claim or service line paid differently than billed? Common denials read: “Not deemed a medical necessity by the payer.” But what is the real issue? For example, denial issues can be related to coding, documentation, or incorrect status. However, the root cause is the confirmed or potential internal glitch that caused the variance in payment for the service or claim.
The next step is to try and diagnose the issue by asking, “What did our organization do that triggered the denial?”
It is recommended that you begin with a claims data analysis to identify the potential root cause or internal missteps. This process involves an internal assessment of the medical record, charges, and the billed claim. An example of a root cause would be the release of information that the vendor sent to the hospital medical record in response to an audit request without requesting the necessary corresponding physician office medical record that contains the documentation of prior encounters.
To avoid denials, it is essential to collect valid data based on the actual root cause rather than simply relying on the reason codes returned by payors on 835 remittances. When properly collected, analyzed, and reported, you can use this information to:
- Identify patterns and trends that inform denial management strategies.
- Define the service site, service type, payor, and (possibly) physicians where issues originate and offer education and training to decrease denials caused by internal missteps.
- Communicate with payors to establish specific contract terms regarding payment and appeal rights.
The benefits of a technology approach to denials management are abundant. By integrating these denials management, analytics, and technology solutions into your organization, you can accomplish many crucial goals to improve your denials rates—a few of which you can find below.
- Determine the root causes of payor denials
- Capture coding and clinical validation changes
- Provide targeted education on the front end of the revenue cycle
- Increase knowledge of payor contract terms to mitigate risk
- Move from payor denial management to prevention
- Centralize workflows for unified denial management and appeals
With Sharecare’s Centaur Technology and Denial Management Services, you have a dynamic partner to help you navigate the denials process and take on the tedious tasks that allow you to resubmit your claims confidently. First, Sharecare conducts a vulnerability assessment to determine your error rates and risk score (what’s at stake) and puts lasting corrective actions in place. Then, we evaluate your situation and put in measures for present and future concerns. And the best part, we cover the cost of the assessment with found dollars, or you don’t pay.
But don’t just take our word for it because we don’t want to just tell you how we can optimize your claims denials processes, we want to show you. Book a demo of our software solution and see for yourself how we can help your practice successfully maneuver claims auditing and possible claims denials.
Medicare audit season is upon us, so don’t take a reactionary backseat to claims denials – let us tackle it for you so that you can focus on your patients and continuing to build a successful practice or organization. The time is now.