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Early Attention Pays Off: Prevention Is the Key to Reducing Denied Claims

May 9, 2017

However healthcare reform plays out, pressures on medical practices – complex codes, MACRA rules, declining payment rates – highlight the importance of capturing more revenue from insurance claims.

Procedures focused on prevention are an overriding healthcare best practice. Prevention is less expensive than treatment and this is true in the billing office as well: You can expect initial rework on a single claim to cost $25.

So what would it take to shift your claims management to a prevention model? Here are the main steps involved:

Track, then analyze.

A well-defined tracking process centered on payer, reason and amount – and with clear responsibilities, recording and double checks – is essential to everything else. Analysis is less common, but a little work can reveal the patterns that will show you where to concentrate.

Stress accuracy up front.

Because most claims are denied based on minor inaccuracies, establish a culture of precision throughout the office. Set concrete goals to reduce specific errors and reward success. A restaurant gift card for diligent billing associates is a small cost if they can lift your reimbursement rate.

Be proactive and timely.

Claims will still be denied, of course, but prevention remains key. For example, you canpreventlatency, or timespent waiting on a denial before correcting and resubmitting a claim. Understand each payer’s protocols (they vary considerably, both for submission and payment) and contact each one before being notified. This is common practice in business, where accounts receivable departments use a polite and friendly tone with customers to create friends in the offices that cut checks.


With the accelerating complexities of healthcare,do you really want employees memorizing codes, remembering problem claims or spending valuable time tracking claims with Excel? Instead, use an automated system to do these things. Compare software costs (including training) to the cost of denied claims and then get the best tool you can afford.

By preventing denials in the first place, you can avoid hours of rework. And by extending a preventive culture beyond initial denials, you can rework further. The end result can be significantly more revenue.

Healthcare Practice Strategies - Spring 2017

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