Top 8 strategies to prevent denied claims

Healthcare revenue cycle management is a complicated yet essential aspect of healthcare financial growth. In the field of medical billing and healthcare administration; denied claims are the damaging factors to the financial growth of any industry. This is a concern that must be monitored by every physician to prevent excessive revenue loss.


According to a recent study, over $262 billion worth of claims are denied each year on average. Therefore, physicians should acquaint the importance of physician medical billing professionals to monitor their revenue cycle and configure claim submission procedures to optimize financial growth. With careful and organized follow-up, the majority of these denied claims are recoverable and can be omitted. This approach can help to leverage the bottom line of the healthcare industry and stand for long in this fast-pacing competition.


If healthcare practitioners and other medical facilities want to accelerate their revenue growth while reducing their admins arrive expenditures then they should outsource their physician medical to a trust-worthy and HIPAA compliant offshore medical billing company. Successful medical billing and coding strategies help to overcome the amount of denied claims and smoothly scrub the claim to ensure reimbursement.


Claim denials waste the time and effort that is consumed to render a healthcare service and demotivates the practitioners. Therefore, large physicians’ accommodations like; physicians’ groups, hospitals, and medical clinics should opt for a suitable solution to run their business smoothly. By having to take the time to rework and resubmit a denied claim, an organization’s medical billing staff is pulled away from submitting new claims. The ultimate goal is to identify the cause of denied claims in the first place. Healthcare facilities, regardless of their size, will never optimize their revenue cycle, unless this problem is solved by physician medical billing professionals. Otherwise, they cannot overcome the ongoing revenue loss percentage.

8 Ways to prevent denied claims (revenue leakage):


1. Insurance Coverage & Network Status:

Claim denials are more often created due to the uncertainty of patient’s insurance benefits. Deductibles, secondary insurance, primary insurance, and copayments can all affect the status of claim submission procedures. Therefore, physician medical billing staff must follow up and confirm prior authorizations for the medical procedure or if the health professional is out-of-network can also create complications. Moreover, this trend always verifies the patient’s demographics and credentialing status of the healthcare practitioner. Large-sized healthcare services ought to outsource physician medical billing services to overcome excessive expenditures of hiring and training medical billing administrative staff. They can help to monitor patient’s information and status on all of their insurance panels.


2. Healthcare Provider’s Insurance Contract:

Most of the healthcare practitioners work to minimize the chances of occurrence of denied claims to ensure maximum reimbursement. Although there are other factors that are the source of the major revenue loss, while claim denials are the most effective cause of the fiscal decline. Healthcare practitioners must consider the significance of the location, medical specialty and the volume of claims that can impact reimbursement rates from healthcare insurance.

These contracts often provide awareness of the coverage policies that are centered around prior authorizations, procedures, referrals, etc. Payer contracts are legitimate documents and they are fully negotiable. Healthcare providers should focus on effectively negotiating their payer contracts to optimize their revenue generation. They must comply with the value-based healthcare services and follow HIPAA guidelines while providing their services to insurance plan members.


3. Closely Track Accounts Receivable:

Physician billing staff must completely monitor and review the updates in patients’ information, medical coding standards, and physician’s services daily. Medical billing and coding staff must pursue a consistent flow in claims while eradicating any blockage and bottleneck in revenue cycle execution. When a claim has been in the system for 60 days, a direct phone call should be made to the health insurance company to receive reimbursement.

This strategy is adopted to check the status of the claims while also recording the claim number and date of expected payment. This verification procedure is inevitable for the healthcare practitioners as it is the only assisting that can help to ensure reimbursement and optimize revenue growth. Physician medical billing also involves the information of track record of claim submission, claim payment, check/transition number as well as the amount paid. If a check was issued, verify the mailing address and whether it was cashed. However, it helps to appeal to the claims that were unexpectedly denied.


4. Verify Coverage:

It is necessary for healthcare practitioners to verify insurance benefits as soon as possible. Physicians should properly guide their medical billing staff to comply with the real-time data of patients prior to healthcare practices to catch if a patient’s coverage has lapsed or been completely evolved.

If coverage is no longer active then physician medical billing professionals can request updated insurance information from the patients to require the front desk staff to ask the patients for self-pay.

It is important for your medical billing and coding staff to verify insurance benefits as soon as possible. Doing so prior to services being rendered can help to notify if a patient’s coverage has lapsed or been terminated. If the medical administration staff finds that the coverage plan of the patient is not active anymore, then they can request updated insurance information or require the patient to self-pay. If the coverage plan is not asked to be up-to-dated then it could result in claim denials.


5. Request Pre-Authorization:

Many non-emergency related medical treatment procedures require prior authorization by the healthcare insurance company, especially for expensive diagnostic treatments like an ultrasound or MRI, or surgical procedures and inpatient admissions. If the medical billing staff doesn’t obtain appropriate authorization then they can’t succeed in receiving complete reimbursement due to claim denials.


6. Check Your Spelling:

It is very important to review the information and identify if there are any mistakes in spellings and omit these mistakes. Incorrect spellings cause incorrect patient identifiers that result in claim denials. Medical billing staff must carefully verify a patient’s name, date of birth, group number or policy number.


7. Use the Correct Code:

The most significant approach to prevent claim denials is using accurate medical coding guidelines. Incorrect medical coding or outdated codebook can cause a prominent revenue loss and impact the bottom line in a significantly negative way. Medical coders should utilize the most up-to-date CPT (Current Procedural Terminology), ICD-10 (International Classification of Diseases) or HCPCS (Healthcare Common Procedure Coding Systems). If outdated coding standards are used then it will cause an obvious increase in denied claims ultimately resulting in revenue loss.  


8. File on Time:

Each insurance carrier has typically filing deadlines ranging from 90 days up to one year after the date of service. If the claim is not filed before the deadline then it would also be included in the query of denied claims.