Denial Prevention Tactics Are Front End-Focused
Revenue cycle departments spend lots of time and money appealing denied claims. However, some hospitals are diverting resources to the front end instead. “Getting it right up front makes so much more sense than staffing the back end for extensive clean-up,” says Pete Kraus, CHAM, CPAR, FHAM, business analyst for revenue cycle operations at Emory Healthcare in Atlanta.
Kraus gives these examples of insurance-related errors that registrars can correct before claims are sent: incorrect, missing, or unverified insurance; incorrect coordination of benefits; missing orders; scheduled services that do not match the services rendered; missing authorizations; unverified coverage for the date of service; failure to notify the carrier of the patient’s status (inpatient or observation); and missing Advance Beneficiary Notice of Noncoverage.
“It’s a mystery to me why every hospital doesn’t invest in robust financial clearance, with well-defined rules of what constitutes a complete pre-admission from the insurance perspective,” Kraus offers.
Financial clearance simply might not be possible, as with some ED visits or same-day appointments. Patient access needs to know when it is OK to defer a procedure in those cases because of incomplete or pending information. “Rules regarding deferred procedures are determined by hospital administration,” Kraus explains. “Some facilities are stricter than others.” In the absence of well-documented guidance, patient access risks “getting caught in the middle, regardless of what they do,” Kraus adds.
When denials are analyzed for financial clearance shortcomings, the group of denials that were caused by approved exceptions from policy can be put in a separate bucket.
“You can determine how much the deviations cost the facility, and whether the exceptions should be revisited,” Kraus offers.
Possibly, the hospital allows certain physicians to admit more than the expected share of financially challenged patients because those physicians bring the hospital a lot of business. “But if they bring in too many indigent patients racking up huge, uncollectible bills, the practice might warrant review,” Kraus cautions.
Preventing denials on the front end is a major focus at Philadelphia-based Thomas Jefferson University Hospitals and Jefferson Health. The sheer volume of denials demanded this shift. “You can’t just do a backward look on what your write-offs were. You have to be proactive and look at the denial inflow so you can properly assess the collectability of your A/R,” says Cynthia Fry, PhD, senior vice president of revenue.
The department is using artificial intelligence (AI) to combat some front-end denials: failure to timely notify the payer of an admission and “no authorization” for radiology, cardiology, and surgical procedures. First, the AI determines if an authorization is required. If so, the account is routed to a patient access employee who submits the request. “Our AI continually checks the payer portals to retrieve the authorization,” Fry says. “It works like bookends on the authorization process.”
Sometimes, claims are not flat-out denied. Instead, the health plan downgrades the claim, which means less revenue for the hospital. “We refer [downgrades] to case management to review,” Fry says.
If a “downgrade” denial happens, case management determines if they will appeal it. Assuming the patient met admission criteria, case managers send the clinical documentation. If case managers agree with the payor’s decision to downgrade the claim, the account is returned to the revenue cycle. “The claim is rebilled as observation. The inpatient balance is written off,” Fry says.
For cases in which the patient did not meet inpatient criteria, staff conduct a root cause analysis. It is possible the admission occurred when case managers were not present, or the patient really should have been placed in observation.
“It’s a team sport,” Fry notes. “Patient access, physicians, care managers, and revenue cycle need to partner to be successful.”
At Phoenix-based Banner Health, simple mistakes, such as bad addresses or incorrect ID or group numbers, were causing many denials. “We all know that a missing prefix from a policy number or a miskey of one digit for any of the policy information can cause a claim to hold up with the payor for incorrect data,” says Amber Hermosillo, revenue cycle educator and quality director.
The department found success with an insurance verification tool. “The integration to our host system allows a real-time quality check as the registration is taking place,” Hermosillo explains.
Any registration quality issues are identified quickly. Patient access updates insurance information as needed. “This reduces A/R days. It provides our patients with a better billing experience from the point of service,” Hermosillo reports.
The preservice department recently transitioned to a centralized team. “This team is able to clear a high number of patients prior to their services while maintaining exceptional registration quality scores,” Hermosillo says.Revenue cycle departments spend lots of time and money appealing denied claims. However, some hospitals are diverting resources to the front end instead.
Subscribe Now for Access
You have reached your article limit for the month. We hope you found our articles both enjoyable and insightful. For information on new subscriptions, product trials, alternative billing arrangements or group and site discounts please call 800-688-2421. We look forward to having you as a long-term member of the Relias Media community.