Medical Billing Denials and How to Prevent Them

by | December 13, 2021 | 9:35 am
Medical Billing Denials and How to Prevent Them

Medical billing denials cost health care facilities a significant amount of money, decreasing revenue. Insurance companies reject claims for several reasons. Denials range from missing information to spelling errors and incorrect filing dates.

Medical Billing Denials Statistics

  • Medical billing denial rates range from 5-10%
  • Denial rates on first billing are as high as 15-20%
  • Rework costs average $25 per claim
  • Denial rates are between 55-98%, depending on the medical denial management team.

Denial rates decrease when they are clearly understood. Medical billing professionals can help your team manage workflow to avoid these denials. Identifying errors can help you to devise strategies to prevent similar issues in the future.

Top Five Medical Billing Denials

  • Missing Information

Most of the time, either the front office or the patient fails to complete the necessary details when filing insurance claims. It is essential to complete all required fields to avoid denials. The administrator should crosscheck all details before submitting.

  • Duplication

A common mistake is submitting claims for a single patient more than once, with the same details, including services, date, and provider. This can prompt the insurance company to deny the claim.

  • Claimed Services

This type of denial occurs when claim benefits for the services are already covered or included in a previous claim.

  • Limited Insurance Plan

Limitations in insurance plans lead to denials. It is crucial to verify the patient’s details before submitting to the insurance agency to avoid such denials.

  • Expired

These denials are common in the medical billing industry. They happen when management fails to file claims before the due date. Most medical claims must be filed within a given period.

These common claim denials can be avoided by uncovering weaknesses in the management cycle. You can prevent most medical billing denials with focus and diligence.

How to Prevent Medical Billing Claim Denials

Adding expertise can help in preventing medical billing denials. Outsourcing companies can streamline medical billing activities and aid in managing end-to-end claiming processes.

Denial Management

Tracking, reporting, and analyzing different types of denials can help your organization prevent future denials. Gather all denial information from the practitioner, front desk, administrator, and payer on one shared platform.

Process Orientation

Create a checklist that can assist in completing an error-free claim process. A checklist can help your team identify common mistakes before the claim is sent to an insurance company. Proper management of the claim process can reduce the denial rate.

Streamlined Registration Process

At admission, help your patient complete the correct information. Lack of data accuracy is the primary source of claim denial.

Identification Rather Than Assumption

It is essential to identify the cause of the denial rather than assume it. Check your coding or perform root cause analysis.

Managed Revenue Cycle

Denials can affect your healthcare practice. Work with patient accounting, case management, medical records, coding, contracting, compliance, and patient access for better results.

Advanced Medical Billing Software

Automation can help you reduce manual errors and provide effective strategies to the front desk to improve the claim process and data gathering. Automation can also help in detecting an error in insurance applications, which can reduce denials.

Patient Management

Help your patient understand the importance of accurate details for a successful insurance claim.

There are many ways to reduce medical billing claim denials. One of the best ways is to outsource medical billing and revenue management to a highly trained company. They can reduce workload, process claims faster, and help with EOB in Medical Billing. Their expertise manages your daily workflow.

Are you looking for medical billing services at cost-effective rates?

Next steps

  • Get in touch with our expert today to understand how our Medical Billing Services and solutions help in decreasing claim denial rates.
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