Using Denial Tracking to Improve Cash Flow and Staff Productivity
Problem : Denials – you get them everyday. Do you know how many of those denials you expected and how many you didn’t? Do you know how many you get a month and which aging bucket they affect? The bigger question is, do you have the information to understand the fundamental cause so you can prevent or properly manage them?
Cause: Many things can go right or wrong from the time a claim is mailed or submitted electronically to an insurance company. Posting the reasons claims were not paid as billed is as important as posting the cash received. In the home infusion industry, you very rarely get a claim that is paid to the penny and as a result, almost every explanation of benefits needs reviewed by a collector.
Impact: Understanding how many denials you get a month and how old they are is important in understanding how your intake and editing departments are doing. If you are receiving a high percentage of unexpected denials in the first 60 days, you will want to understand why you are getting them and then having the information you need to possibly “fine tune” a process within your organization.
Solution: Denial information is communicated via electronic claims reports and the explanation of benefits. A process must be in place to insure that all of the communication from the payer in these documents is received and followed up in a timely manner. Three options to get this done are to enter the information manually, process the 835 remittance file electronically if your software vendor has the capability and use a service such as RemitDATA (www.RemitDATA.com) to process the 835 and provide reports back to you. Once you have the data in your system, make sure you close the loop with proper reporting and review to process and prevent denials in a timely manner.
Benefit: Being able to quantify your denials from a work load prospective and a dollar amount, it is important to report on the information. Working a denial as quickly as possible is important to keeping cash flowing and/or relieving your A/R for an non-payable claim is imperative. Denial information is a “vital sign” for the health of your reimbursement process. Use it to get and stay healthy.