By Marian Ses Howe, RNC
From Compliance Today, a publication for HCCA Members
Are writing appeals to payers who have denied reimbursement a waste of your company’s time and resources? As a compliance professional, perhaps the better question to ask is: “Why are claims being denied in the first place?”
[bctt tweet=”@theHCCA As a #compliance professional, the better question to ask is: “Why are claims being denied in the first place?”” via=”no”]
Payers reject claims for many reasons. The most cynical theory, of course, is that some payers may still routinely reject a percentage of correctly prepared bills as a matter of course. This may be particularly true for bills less than $100, because the payer is at least peripherally aware that preparing a response may be more costly to the facility than the original bill was worth. Although this has become a rare tactic among payers, it is a payer practice that should be neither tolerated nor ignored. Immediately present such a denial to your financial team to determine how you want to handle these types of accounts going forward and, if a pattern exists, to your legal team. An attorney may leap at the opportunity to confront this type of industry behavior in the legal arena.
Of course, payers have many valid causes for denials. These are the ones you must vigorously attack and eventually prevent. The simplest way to prevent many denials is to make certain beneficiary information is correct and complete and properly transferred to the bill. Let’s say you have a patient who says his name is John Smith. Do you clarify the specifics? Is he John Smith, Jr. or perhaps Jon J. Smith, Sr? Or is he actually Yohnathan Smith? Have the identification numbers been properly copied from his ID card, or was there a transposition or omission of one or more figures? What about the expiration date on Mr. Smith’s insurance card—has it come and gone or is the coverage still valid? These may seem simple, common sense points and yet scrupulous attention to detail is one of the most efficient and cost effective weapons in minimizing denials.
Compliance professionals must also be aware of the concept of contractual payer obligations and impart their significance to all applicable facility departments. Perhaps your facility has contracted with a particular payer to provide only stabilizing emergency services to their beneficiaries. You have agreed to transport all beneficiaries to a specific facility within six hours of stabilization in your Emergency Department (ED). Nothing actually requires you to transfer the patient, of course, and the patient’s well–being must always come first, but if you admit the patient to your surgical floor from the ED and submit subsequent charges, you should expect a denial of payment for disallowed services, based entirely upon your contract. Know how your payer contracts read and make certain your Billing department knows as well. If the denial involves contractual issues, they should not come as a surprise. Unless your facility received a waiver for the specific non-contract service, or the service was so medically necessary that your chief medical officer has agreed to argue it in a court of law, an appeal in this case is probably an exercise in futility.
A third significant opportunity to prevent denials is to recognize the correct payer upon admission. Is this account tied to an automobile accident or an old workers’ compensation claim? Is the patient a Medicare beneficiary who is covered under his working spouse’s insurance policy? Does the patient have three Blue Cross policies? It is imperative that the individual who establishes a confirmation of benefits be thorough in identifying the patient’s primary payer at (or as near as possible to) the time of patient entry into the system. This can often be a challenge, particularly when the patient is elderly/infirm or when trauma or violence is involved. Sensitivity must walk hand-in-hand with perseverance in obtaining the correct payer information. Take the opportunity to view this as preventing the further insult of an improper bill, resulting in a denial of payment being presented to the patient at a later time. In this case, preventing a denial of payment to your facility by identifying the appropriate payer in the beginning also protects your customers from frustrating—possibly devastating—interactions with the payer later.
Finally, the concept of applying appropriate modifiers and codes cannot be stressed enough. As compliance officer, make certain the persons assigning all codes in your facility are properly trained, provided with the most current coding and editing software, and routinely audited (both internally and externally) for compliance and competency.
In short, make certain your claims are clean, your contracts are understood, your charge-modifiers are appropriate, and your payer information is scrupulous. In the land of denial avoidance, you will surely have taken a giant leap forward.
Marian Ses Howe (firstname.lastname@example.org) is in Compliance, Outpatient Services at Summit Healthcare in Show Low, AZ.