Denials Management: What is it really?
Everyone talks about denials management, but how does it work? Some organizations brag about standard letters sent when an insurance company denies a claim. While there was a time this approach constituted the scope of a denials management effort, capabilities have drastically improved with advances in technology. What does denials management mean today?
Goals of a comprehensive denials management program:
- Prevent the denial from occurring by improving the quality of claims data
- Use analytics to determine the root cause of denials that do occur and when possible, make process corrections at the source
- Appeal denials that can be appealed and don’t spend time on those that cannot
How does denials management work?
Front end mitigation
Billing computers and clearinghouses have developed sophisticated “scrubbing” and editing capabilities that reduce denials. Billing information is reviewed and corrected as the claim is prepared, improving the ratio of complete, accurate claims sent to an insurance company. Or the system identifies when, for example, anesthesia notes for acute pain blocks can be submitted prior to payment consideration, rather than in response to a denial. Clean claims improve revenue by generating payment on the “first pass.”
Documentation and coding
Failure of the physician to dictate complete and accurate information results both in down coding (billing a limited study instead of a complete study, for example) or denials due to the inability to support medical necessity. This represents a universal opportunity for improvement. MSN offers comprehensive physician documentation education programs. Live presentations are supported by a virtual library allowing for on-demand access to valuable guidance.
Retrospective denials analysis and feedback
Advanced analytics monitor denial trends and can provide specific feedback regarding why, when and where a particular denial type has occurred. This level of analysis facilitates root cause identification and correction. Work at this level requires a team effort, involving feedback from MSN and active participation from the client practice. MSN coders have a secure process to communicate with client physicians in real time and without cumbersome e-mails.
Appeals
Yes, appeals are still part of the denials management process—but with a comprehensive program in place, there are fewer denied claims to appeal. MSN has denials specialists who focus on appealing claims, but who also know when not to spend time and resources on denied claims with no avenue for appeal. For example, some state Medicaid plans will only pay for one routine OB ultrasound so it is fruitless to appeal second and subsequent denied routine OB ultrasounds.
Denials management—it’s a lot more than sending letters! And remember, just because a claim is denied does not mean it will not be paid. However, it does take a dedicated effort by knowledgeable billing employees.
Prior to joining MSN Healthcare Solutions as Director of Education and Corporate Communications, Pat Kroken had nearly 30 years of experience in radiology management as both a practice manager and consultant to radiology groups, billing companies, software vendors and hospital radiology departments.
Pat has had more than 200 articles published, is a regular contributor to the Radiology Business Management Association (RBMA) Bulletin and a frequent speaker on practice management topics. She served two terms as President of the RBMA, is Editorial Advisor for the national RBMA publication, The Bulletin, and represented the “business side of radiology” as RBMA Liaison to the Radiological Society of North America (RSNA) Associated Sciences Consortium for 7 years.
