Denials cut from $200K to $50K

Requirements surge demands new processes

Because the findings were unclear on an abdominal and pelvic sonogram performed for a patient at Cook Children's Medical Center in Fort Worth, TX, the radiologist performed a CT scan of the abdomen and pelvis with contrast, but this additional test hadn't been authorized by the payer.

Andrea Ayala, financial counselor for patient registration, successfully requested a retroactive authorization, because the test was performed only a day earlier.

"Had this not been approved, it would have resulted in $4,867 in denied charges," says Ayala. "Denials for scheduled tests are now very rare. Thankfully, we have seen these decrease greatly."

High-dollar procedures such as magnetic resonance imaging (MRI) were frequently denied due to no authorization, she says. "This was despite the efforts by our insurance team and referring physicians to have authorizations in place by the time of service," says Ayala.

Staff confirmed the accuracy of the CPT code, facility location, national provider identifier, Texas provider identifier, tax identification number, and valid date span, says Ayala, but this effort didn't address the reason for most of the denials.

Annual claims denials decreased from $200,000 to $50,000 at Cook Children's in the past year because of changes made to address these underlying reasons for denials:

  • The provider recommended another type of study after a different test was already authorized by the payer, or added contrast materials to a pre-approved test.

"This is often done once the patient has presented for testing and may be due to noted abnormalities," she explains.

  • The referring provider added the test, but failed to notify his staff responsible for authorizations of requested orders.
  • New patient registration was unaware that insurance must be verified before the patient is sent for high-tech imaging outside normal business hours.
  • Approved studies were changed to a more appropriate test by radiology, but the insurance team and referring provider offices were unaware of the changes.

Verbal communication about the change sometimes took place between the radiologist and the referring provider, or another type of diagnostic test might have been done because the radiologist was unable to obtain clear findings, but the denials still occurred, says Ayala. "In many cases, the insurance will not pay for anything else than the specific CPT that was approved," she says.

Communication revamped

Members of the radiology staff now notify patient access staff of same-day changes for high-tech imaging, says Ayala. Some commercial insurance and Medicaid managed care plans refuse to revise an authorization even if it's called in the day after the test is performed, she says.

"This could result in claims denial of the approved test in its entirety. We must make every effort to communicate changes that same day," she says.

Ayala obtains same-day email notifications of MRI and CT order changes with the patient's account number. "This helps me to review the account quickly, to initiate communication with the carrier," she says. (See related story, below, on how daily reports are used to reduce denials, and see story, right, about how a pre-arrival unit reduces claims denials.)


For more information on processes to meet payer requirements, contact:

  • Andrea Ayala, Financial Counselor, Patient Registration, Cook Children's Medical Center, Fort Worth, TX. Phone: (682) 885-7113. Fax: (682) 885-6060. Email:
  • Sylvia Greer, MBA, Associate Director, Revenue Cycle Management, University of Mississippi Health Care, Clinton. Phone: (601) 926-3870. Fax: (601) 926-3903. Email:

Radiology reports eliminate 'no auths'

Radiology managers at Cook Children's Medical Center in Fort Worth, TX, now create a daily report for all of their scheduled patients, which gives the patient name, account number, a description of the test, and the payer. The goal is to eliminate claims denials for high-dollar procedures.

"These accounts are worked in advance by our insurance team," says Andrea Ayala, financial counselor for patient registration. "I run this report each morning to review the prior day's registrations. I compare the CPT codes authorized with the actual study that was performed."

The reports identify the CPT approved by the carrier and the actual CPT performed, including last-minute add-ons who bypassed the scheduling and insurance team.

"This has been extremely helpful in requesting appropriate authorization prior to the claim billing, thus never getting a rejection and delaying payment," says Ayala.

For example, if a magnetic resonance imaging (MRI) of the brain without contrast (CPT 70551) was approved by the payer, the report might indicate that an MRI of the brain with or without contrast (CPT 70553) was performed instead. "In this case, it would be a denial if it was not retroactively approved by the insurance," says Ayala. "I would follow up with the carrier to request the revision."

Radiology creates a second report of radiology patients who were registered the previous day, but were unscheduled by mistake. This report catches any patients that have bypassed the insurance team and physician referral coordinator, so that retroactive authorizations can be obtained, says Ayala.

"Currently, I review about 50 scheduled radiology tests performed the day prior for changes. The non-scheduled tests average about 44 patients daily," says Ayala.

$325,000 in charges is paid due to process

Pre-arrival nurse acts as liaison

Until recently, the authorization process for imaging services was fairly simple, but this situation is no longer the case, says Hope Johnson, RN, the pre-arrival unit nurse at University of Mississippi Health Care in Clinton.

"Payers are now enforcing more stringent guidelines and criteria for authorizing services, including procedures that may be considered routine," says Johnson.

A pre-arrival unit was created at University of Mississippi in 2010, to financially clear patients. To date, $325,000 in charges were paid for services as a result of the unit's efforts, which might otherwise have been denied, reports Sylvia Greer, MBA, associate director of revenue cycle management.

"We now have people who are dedicated to proactively obtaining these authorizations," says Greer. "We are usually two weeks out in the imaging area. Now the clinics can provide patient care, while we take care of the authorizations."

Patient accounts handled by the pre-arrival unit were denied for non-coverage or no authorization less than 1% of the time in 2011, adds Greer.

Clinical info provided

Johnson acts as a liaison between payers and physician offices, to ensure that whatever clinical information requested by payers is provided.

"Payers may ask for pathology reports, X-rays, clinic notes, or labs," says Johnson. "We make sure the office realizes how important it is to give this information, so the patient is not responsible for the bill."

If a magnetic resonance imaging (MRI) of the lumbar spine is ordered, for example, the payer might request proof that the patient has tried multiple other treatments including pain management and physical therapy. "They want to know, 'Has the patient tried everything else prior to getting this MRI?'" All of that information isn't always in our charts. The patient may have gone somewhere else for physical therapy, so we will have to contact the office for those records," says Johnson.

If the payer's physician wants to speak peer-to-peer with the patient's physician, Johnson facilitates those conversations. "All the notes may be in there, but the doctor from the insurance company wants to discuss the reason a test is being ordered with the physician," she says. "Most of the time when they talk, the case is approved."