Why are practices worried with A/R & Denials & how can they overcome that?

Did you know demographic or technical errors are one of the top reasons for claim denials?

According to the Advisory Board’s Revenue Cycle Bench-marking survey, approximately 61% initial denials are caused due to technical/demographic errors, followed by 16% due to eligibility and 12% due to medical necessity errors.

When it comes to healthcare reimbursements, there is nothing more frustrating for practices than claim denials. In order to survive in business, it has become vital for practices to track and analyse trends in payer denials and fix the issues as quickly as possible. From training billing staff for handling rejections to utilizing automated software or external vendors for optimizing claim management, there are various steps that practices need to take to manage A/R and denials.

Dealing with claim denials

Claim denials create a serious cash flow problem for practices and therefore, one of the best ways to overcome this problem is to appeal denied claims. At times, practices fail to pursue appeals due to lack of time and commitment from their staff. Some practices also lack the money to hire experienced coders and billers for timely billing and collections.

Since providers have to deal with several payers at once, it becomes difficult to keep claim denial dates close to the end of the industry average. Therefore, hiring experienced staff and implementing adequate claims denial management strategies becomes a necessity to avoid leaving more revenue on the table.

Reducing account receivable

Practices also lose revenue due to rise in A/R days. however, with timely follow-ups of claims after submission, accounts receivable days can be reduced. Providers just need to keep a track of how long claims are going unpaid by the payers and make necessary changes to overcome this problem.

Since keeping a track of claims and preventing denial is a time consuming, complex procedure, many practices prefer to outsource this task to a third party. They hire a billing company competent in services like denial management, A/R management, medical coding, payment posting, EOB management, charge capture and so on. Reputed companies have a dedicated team of experts who appeal and follow-up on denied claims to ensure that practices obtain maximum reimbursement for rendered services. By outsourcing revenue cycle management to a reliable billing company, a growing number of practices across the US are reducing costs and optimizing revenue.

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