By Angelina J. Knott, MS, CPC
Executive Director, Healthcare Data Source Management
The number one financial goal in medical practice billing is to be reimbursed appropriately for services rendered and that means getting clean claims out the door the first time. A clean claim is one that is submitted to a payer with correct patient demographic, insurance information, appropriate coding, and supporting clinical documentation. A clean claim is one that is not rejected, but is accepted and adjudicated for reimbursement appropriately.
According to data reported to The Government Accountability Office(GAO) by the Ohio Department of Insurance, claim denial rates across some states range from 11% to 24%. Not all claims denials are equal; claims are denied for many reasons ranging from incorrect patient insurance information to coding errors to insufficient documentation to support medical necessity. The first step in managing claims denials is to understand why the claims are denying. It is important to recognize any trends in the claims denials so that a targeted approach to correction is obtained. High performing medical organizations have a first pass claims rate of 95% which means that the majority of submitted claims are accepted the first time.
Each time a claim is denied it is a missed opportunity for revenue, and providers are not being reimbursed for their services. In fact, each time a claim is denied it costs! Based on industry reports from Medical Group Management Association and Healthcare Financial Management Association, the cost of reworking and resubmitting claims that have been denied or rejected is $25 per claim. Additionally, 50%-65% of denied claims are never worked. To ensure money is not left on the table, medical organizations need a strong denial management team that focuses on tracking, grouping, reworking, and following-up on all denied and rejected claims for full adjudication. Partnering with Healthcare Data Source Management provides effective and efficient ways to make certain no money is left on the table for your organization.
Resources: https://www.mgma.com/resources/revenue-cycle/you-might-be-losing-thousands-of-dollars-per-month
Angelina J. Knott, MS, CPC |Executive Director| Healthcare Data Source Management
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