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Claim denials are an unfortunate reality in our healthcare system – and one that costs providers billions of dollars each year. A study found that of the $3 trillion in medical claims submitted by hospitals alone in the US, 9% of charges were initially denied. That amounts to a stunning $262 billion, and, of course, untold time and resources spent chasing claims.
While completely eliminating denials is not realistic, providers can significantly increase the number of clean claims and streamline payments by implementing a robust denial management process.
Improve Your Denial Management Process: 5 Actionable Steps
Among the most common reasons claims are denied:
- Duplicate claims: Making two or more claims on the same encounter typically results in denial.
- Overlapping claims: Conflicting claims (e.g., clashing dates, claims made by another provider).
- Expired limit of filing: If you do not make the claim within the specified timeframe, the insurer is not liable for payment.
- Not covered by payer: Procedures/services rendered are not covered under the patient’s insurance plan.
- Missing information: Claims missing key details are often rejected.
- Coding errors: Even a small billing or coding mistake can prevent reimbursement.
According to the Center for Medicare and Medicaid Services, 30% of claims are denied, lost, or simply ignored. This staggering figure highlights just how critical strong denial management is for healthcare providers.
Steps You Can Take to Improve Denial Management
1. Tighten Claims Tracking Procedures
The ability to track claims in real time is crucial. When denied claims are caught quickly, you can resubmit them within the allowable time frame. If denied claims slip through the cracks or delays occur, it can lead to serious cash flow issues — and lost revenue that may never be recovered.
2. Figure Out Why Claims Are Being Denied
Identifying the most common reasons for denials in your specific practice is essential. Denial management software can help pinpoint trouble spots, whether it’s coding issues, missing documentation, or coverage problems.
Addressing these proactively can significantly boost your clean claim rate.
3. Enhance Claim Scrubbing Capacity
Claim scrubbing is the process of detecting and eliminating billing errors before claims are submitted.
A thorough scrub dramatically reduces denials, promotes timely payments, and saves valuable time and resources.
4. Utilize Automated Insurance Verification
Coverage issues are a leading cause of denials. Verifying insurance coverage before services are rendered — through your denial management or billing system — can prevent these losses and ensure your practice captures more revenue.
Without verification, you risk wasting valuable provider time and missing out on rightful reimbursement.
5. Get Professional Support
Implementing and maintaining an effective denial management process isn’t easy — especially when regulations and insurer policies are constantly evolving.
Working with an experienced medical revenue recovery team can help ensure that your claims are submitted correctly, denials are promptly appealed, and that you receive the compensation you’re owed.
The Bigger Picture
As healthcare professionals, your priority is delivering excellent care. But without reliable revenue recovery, even the best care models can suffer under financial pressure.
Our team at Callagy Recovery has helped providers recover more than $300,000,000 in lost or denied claims. We understand the financial risks physicians face — and we fight to make sure you get paid for the work you do.
If you’re serious about optimizing your practice’s cash flow and recovering income you may not even realize you’re missing, there’s more you can do.
To learn more about unlocking hidden revenue without seeing more patients, click here for a free training designed specifically for physicians.
You’re already doing the work. Now it’s time to get paid for all of it.
