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How to Avoid and Prevent Denials Throughout the Revenue Cycle

In “Are denials avoidable? A deep dive on denials,” we broke down what a denial is and why you’re getting them. If you missed out, here’s some of the basics you’ll need to know for this article:

When a payer refuses to pay a provider for the services the provider has rendered, the payer will formally issue what is called a denial. Most denials can be reversed and eventually paid out, but extra time and money are needed to reap the benefits of a claim rework. 

The Kaiser Family Foundation found that between 86 and 90% of denials are actually preventable, but how do you prevent a denial from happening in the first place? 

Avoid denials caused by the front end

The first step in avoiding denials is to examine what happens before a claim is created and submitted. Whether it’s collecting patient demographic information, getting the coding correct or submitting the claim on time, most of the problems occur when a claim is being created or submitted.

In fact, most denials—49.7%—are caused by front-end problems, found the Change Healthcare 2020 Denials Index. That means if your practice is looking for a weak spot, you should start your search here. 

Change Healthcare listed these four front-end issues as the largest front-end problems in which to avoid:

  • incorrect demographic information
  • registration/eligibility issues
  • prior authorization/precertification
  • and service not covered.

Demographic information errors

Demographic information issues are particularly tricky to rework since something as simple as a wrong number, a misspelled name, or something of the trivial nature could be what’s holding your practice back from getting paid. 

Thankfully, denials come with reason codes that make it easier to figure out why they occurred and what small thing got overlooked. However, manually sifting through reason codes and trying to categorize them yourself is tedious and bound to be error ridden. Solution: get yourself a software that can actually help, like Rivet.

Registration and/or eligibility issues

There are a couple different ways to look at eligibility and pre registration. First, you can be grateful that you can verify insurance coverage; and second, you can be utterly annoyed at how many tasks are on your plate. 

The Healthcare Financial Management Association advises that at least 24 hours before a patient’s scheduled service, the physician practice should verify the patient’s demographic data; verify their insurance coverage and benefits; and notify the patient of their financial responsibility.

Without current tech, eligibility verification can be a clunky and time-consuming process, but with Rivet you can automate eligibility days before your patients come to the office, seamlessly adding Rivet to your existing workflow.

Prior authorization problems

Prior authorization, as you may already know, is approval from a health plan before a patient can obtain a medical service or fill a prescription in order for the service/prescription to be covered by a patient’s health plan. 

Though many doctors feel they can delay lifesaving medical care, every practice must adhere to prior authorization requirements to avoid a preventable denial. Pro-tip: proactively check prior auth requirements and obtain prior auth before delivering service to the patient. Automated tools that integrate with your EHR can streamline this process and can easily help prevent denials.

Avoid denials caused in mid-revenue cycle and on the backend

Most denials occur from front-end issues, but the rest of the revenue cycle isn’t without its problems.

Change Healthcare found these additional reasons that denials occur:

  • medical documentation requests
  • medical necessity
  • medical coding
  • avoidable care
  • missing or invalid claim data
  • and untimely filing.

Mid-revenue cycle problems

Medical documentation requests, medical necessity, coding issues, and avoidable care are all linked in the mid-revenue cycle. Payers want proof that the care given was necessary for the patient. Consistency is key in documenting diagnoses and prescribed treatments—from the medical record to the clinical documentation, to the coding.

Clinical documentation should be improved to prevent these types of denials. The American Academy of Professional Coders (AAPC) advised practitioners and physicians not to be overly reliant on standardized forms with the EMR.

Instead, providers should consider using the SOAP (subjective, objective, assessment plan) method of clinical documentation. The SOAP criteria can help you think of additional information and details that the EHR doesn’t ask for, but the payer wants to know, the AAPC noted. Documentation must always provide support of the diagnosis and of the codes included in the claim in order to prevent another denial.

Coding Issues

Thanks to thousands of codes from multiple payers, coding-related denials are common. Not to mention, coders must also keep up-to-date with coding changes and updates so that codes and modifiers are accurate. And don’t forget that codes must also reflect medical necessity. 

Pro-tip: open and easy communication between clinicians and coders can prevent these kinds of denials. 

Coders will inevitably have questions about medical necessity or other unclear documentation sometimes. If coders have a way to ask the questions they need answered in a supportive and responsive manner, they could obtain timely answers. Remind the doctors every now and again that these questions aren’t asked to be annoying, it’s to get them paid!

While denials management is ever evolving, you can prevent most of them after you identify where in the cycle you are weakest and why. You can use analytics and other technology that pairs with your EHR to avoid so many denials. Remember: drill down to the root cause(s) of your denials, prioritize action areas and start fixing the issues! If you do, you can spend less time reworking and appealing denials and you can get paid much quicker.

Technology that integrates with your EHR 

Rivet is a modern revenue cycle product suite that integrates with your EHR to allow you to see the big picture of what’s going on in your practice with payer contracts, fee schedules, denials and underpayments. You can also check eligibility and provide accurate up-front patient cost estimates before services are rendered. The Rivet team will help you aggregate your fee schedules and input your claims data to enable you to increase revenue and decrease A/R days.  

For more information about the tools Rivet provides, schedule a Rivet demo.