What’s the Best Way to Avoid Front-End Denials? Clean Claims.

Have you ever had a medical insurance claim denied? Most people have. The statistics vary based on the healthcare segment and the source, but typically the average claim denial rates range from 5% – 10%.  Centers for Medicare and Medicaid Services (CMS) reports their historical baseline for the number of Medicare Fee-for-Service claims categorized as “front-end rejections” at 10%. Perhaps surprisingly, many rejected claims are never corrected and resubmitted for reimbursement.

Laboratory executive leadership can drive increased collections with technology and processes that maximize the number of clean claims submitted.

Best practices to maximize clean claims include:

• Identifying mistakes early. Missing or invalid claim data is one of the top reasons for front-end denials. A revenue cycle management (RCM) solution that “scrubs” claims-required data at the front end of the process helps eliminate these denials. Cloud-based RCM systems in particular provide the capability to adapt and edit rules to continually improve denial rates.
• Educating new customers. Ensure the onboarding process for new customers includes billing requirements. The staff should be provided an easy to follow billing manual and standard requisition that includes all appropriate fields required for payment.
• Managing the metrics. Your RCM system should provide you with metrics identifying customers with the highest rate of errors (missing or incorrect demographics, insurance, or coding) on claims. Provide these customers with continued education by a billing specialist to improve their compliance. Our customers employing this practice experience significant improvements from their customers.

Even with these best practices in place to reduce front-end denials, there will still be some claims with missing or incomplete data. Implementing an RCM system that can automate the process of obtaining additional information will improve process efficiency and drive down operating costs. RCM solutions should be able to automatically fax and send letters to customers indicating when additional information is required. XiFin customers also use our Client Portal as an automated method of obtaining required information.

In a lab environment experiencing continued reimbursement pressure, it is more important than ever to focus on maximizing your reimbursements through clean claims.