7 Tips to Improve Denial Management of Healthcare Claims

Tips to Improve Denial Management of Healthcare ClaimsIt is found that most healthcare organizations lose about 6-8% of their overall revenue as a result of payment denials! The importance of denial management cannot be ignored in the healthcare industry, as ineffective denial management can lead to heavy losses for the healthcare service providers.

The way any healthcare organization manages denials has a major impact on its financial stability. Effectively managing your claim denials can increase your organization's revenue and collections rate while improving patient satisfaction. So how to improve denial management? Here are a few tips which need to be followed during denial management of healthcare claims.

3 Key Fundamentals of Effective Denial Management

Effective denial management is of utmost importance for every healthcare service provider. There are 3 key fundamentals of effective denial management which should be followed by every organization, these are:

  1. Prevention

    The first fundamental step focuses on actions that can be taken to prevent healthcare claim denials in the first place. These actions can be incorporated into the process any time, during pre-admit, scheduling, registration, or billing. It is important that the denial management experts track the progress and inform the client about the process and the changes periodically.

  2. Analysis

    The process of analyzing similar denials is significant in denial management. Analyzing and categorizing similar denials can help the healthcare providers understand the root cause of denials, and is therefore a crucial fundamental step in the denial management process. By analyzing the data gathered by the denial management team, important business decisions can be made, and claim denials can be prevented in the future.

  3. Tracking and Trend Management

    It is important that experts monitor the healthcare claim payment patterns of various payers and setup a mechanism to alert when the deviation from the normal trend is seen. This is important in understanding the causes of claim denials and enhancing long-term efficiency while drastically reducing the revenue lost in claim denials.

7 Tips to Improve Denial Management of Healthcare Claims

It's crucial to focus on denials to efficiently manage hospital's revenue cycle. Reducing the number of denials can be beneficial to healthcare organizations as it helps them increase profits. Here are some of the tips you can follow to help streamline your healthcare claims management processes and promote an efficient denial management strategy:

Understand Why Claims Were Denied

1. Understand Why Claims Were Denied: Knowing why your patient's claim was denied is important if you want to streamline the process to maximize your revenue collections and prevent future claims from getting denied. Not all your patients are aware of the insurance denial system and it is your job to educate them on how they can solve the issue. Being able to help your patients in a timely manner is vital to the overall success of your organization.

Streamline the Denial Management Process

2. Streamline the Denial Management Process: Losing track of denied claims can prove to be a serious problem in the future as denied claims have a way of piling up over time. If there is no organized system in place, it gets very difficult to keep a track of the denied claims. New tools and technologies help hospitals manage and keep an eye on denials which need attention.

Process Claim Denials Within a Week

3. Process Claim Denials Within a Week: Keeping track of your claims will lead to a more effective system. Creating a strong workflow for your denied claims is of prime importance to establish a strong denial strategy. When you receive a denial from an insurance company, there should be a process in place to ensure that the denial is processed within a week.

Track Your Progress

4. Track Your Progress: Keeping track of the progress and success of the denial management process is of utmost importance as it helps organizations see which areas are working and which ones need improvement. All wins and losses must be documented with regards to your unpaid claims. The ultimate goal is to improve the efficiency of your organizational denial management strategy by making use of the available data.

Identify Most Common Denials and Trends

5. Identify Most Common Denials and Trends: Identifying the types of denials that are most common to your organization is also a crucial component of establishing an effective denial management process. Each type of the denials may seem like a small problem initially but as you continue to track and analyze these trends, you may find out major issues within your organization.

Introduce Incentive Programs

6. Introduce Incentive Programs: Incentives should be put in place to motivate staff and promote healthy competition. The employees should have the right incentives to not only appeal denials successfully but also to identify trends and share best practices.

Outsource your Denial Management Process

7. Outsource your Denial Management Process: Outsource your denial management processes to an expert healthcare BPO company which specializes in providing revenue cycle management services including denial management. The top denial management providers use specialized teams that are highly trained in handling the complexities of the insurance system. By outsourcing your denial management needs you will have more time to concentrate on your core competencies.

7 Key Benefits of Healthcare Claims Denial Management

Fixing claim denials is a crucial part of the medical billing process and comes with its own set of advantages. Some of the key benefits of healthcare claims denial management include:

  1. As the denial causes are identified, the cash flow is maximized
  2. By collecting and interpreting denial patterns, their root cause can be identified and a suitable solution can be devised for such categories
  3. Collecting information on denial appeals, including status, escalation, correspondence with payers helps in increasing recovery amounts
  4. Providing accurate and timely reports to the management allows them to take better business decisions and prevent future denials
  5. Helps you timely track, prioritize and appeal denials based on federal and state statutes and case citations favoring the medical provider's appeal
  6. Analyze the effectiveness of denial resolutions
  7. Identify business process improvements to avoid future denials

Leverage Flatworld's Denial Management Expertise

Flatworld Solutions provides streamlined healthcare claims adjudication services and has a vast experience in denial management services, medical claims recovery, and healthcare billing management. We have been in this industry for more than a decade and have been providing claims denial management services at very cost-effective prices. We understand the various intricacies involved in dealing with insurance companies and our experience helps us transact with them without any hassles. Having worked with clients around the world, we guarantee to bring down the number of claim denials by a considerable margin.

If you have any healthcare claims denial management service requirement, please feel free to get in touch with us and we will get back to you within 24 hours.

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