6 Steps to Improving Your Rejected Claims Process

Dealing with denied insurance claims can prove to be both frustrating and time-consuming. Nearly 20% of all claims are denied, rejected, or underpaid, and as many as 60% of these returned claims are never resubmitted. 

Denied claims are costly, and can lead to: 

• Lost revenue 
• Administrative burden 
• Patient dissatisfaction 

This problem is only getting worse. A survey conducted by the American Hospital Association (AHA) found that 89% of all hospitals and health systems saw a rise in denials over the past three years, with over half of the participants describing the increase as “significant.” 

So, what can we do about it? The good news is that most claim denials can be prevented. Let’s take a look at steps you can take to improve your rejected claims process. 

1. Understand why claims are rejected 

Before we can solve the problem, we have to understand the root cause. Why are claims being rejected? According to a recent survey of healthcare professionals—mostly executives in finance and operations—here are the most common reasons insurance claims are denied: 

• Authorizations 
• Provider eligibility 
• Code inaccuracies 
• Incorrect modifiers 
• Failure to meet submission deadlines 
• Patient information inaccuracy 

Consider utilizing data analytics to identify denial patterns at your practice so you can target your efforts for the most impact. 

2. Streamline Prior Authorizations (PA) 

Implementing electronic Prior Authorization (PA) stands out as the most significant opportunity to improve revenue results. PA can be difficult to manage because the requirements vary widely from one insurer to another. But the technology now exists to automate much of this process. Some eligibility solutions offer advanced technology that can detect if Prior Authorization is needed. This capability significantly reduces the risk of providing services that will not be covered without the necessary PA, and it also saves revenue staff time from having to rework claims.

3. Check claim status 

Electronic claim status inquiry automatically gives billing staff updates on the status of their submitted claims. It also provides access to notes and financial data. When this information is immediately available, billing departments can use an Exception-based collection approach. Allowing them to focus on exception claims (i.e., problem claims). 

4. Implement electronic claim payments 

The primary benefit of electronic claim payments is that providers get paid more quickly, significantly improving cash flow. Electronic payments are also more efficient and provide better management and control. By implementing electronic payments you can decrease the revenue loss associated with the rejected claims process.

5. Automate receiving of Electronic Remittance Advice (ERA) 

An ERA is an explanation from an insurer about a claim payment. It explains how the payer has adjusted claim charges based on contracted rates and what secondary payers owe. Having this information readily available is vital for the efficiency of your revenue team. 

6. Train staff in prevention

Conduct training sessions for staff to impart denial prevention strategies, ensuring a knowledgeable team capable of effectively navigating complex reimbursement challenges. Teach them to utilize the tools available to identify and address potential issues before they escalate into claim rejections. By staying proactive and informed, your team can efficiently mitigate claim denials, streamline the reimbursement process, and ultimately improve overall revenue outcomes. 

Get started today to prevent rejected claims

Medical groups deserve to be paid everything due to them. If you’re frustrated with your group’s current revenue collection outcomes, we can help. 

Learn more and schedule a demo today here.