MEDICAL BILLING - APPEALING DENIALS

This particular rumor has been circulating for some time among physician practices. May we finally let it rest in peace. What is this rumor? It is the rumor that says if you appeal a denial that you will be targeted for an audit or a delay in paying your claims. One study says that as many as 50% of denied claims are never resubmitted or appealed. Year after year medical providers leave money on the table of insurance companies. This helps the health insurance companies remain profitable while bankrupting the cash flow of your practice.

Appealing denied claims does not set you up for audits. In fact, your chances of success in an appeal are better than you think. Also the state of Ohio has prompt pay laws that insurers much adhere to so they cannot delay paying your claims without being subject to financial penalties. In the good old days maybe you could afford to leave money on the table, but not today. With low reimbursements, high malpractice, high staff turnover and expenses rising, practices need every cent of their money.

Most denials fall within two categories: claim level denials and service level denials. Claim level denials involve the denial of the entire claim. Some of the most common are duplicate claim, patient not identified as our insured, date of death precedes date of service). Service level denials are claims where a portion of the claim is denied. Reasons can range from modifier invalid for procedure code to invalid diagnosis. Most service level denials are due to inadequate training of staff on the latest billing and coding regulations.

The other problem is that although some practices have no problem appealing denials, they don’t where to start. The EOB’s that they receive are often coded with denial codes that don’t make sense even after you have read the explanation for it at the bottom of the page. Precious time must still be spent calling the insurance company and asking them to translate the meaning of the code in plain English. Even then some of the reps can’t really explain it either or their explanations are confusing us even further. (My favorite is please refer to our website and after doing so, I find that the information is not there)

So let’s decode a few of the most common denials and how to appeal them.

1. These are non-covered services because this is not deemed a medical necessity by the payer.Medicare uses this code a lot. Other payers state the wording slightly differently. The good news is that you don’t need to appeal this denial with massive notes showing how necessary the service was for the patient. The code simply means that you didn’t use one of the diagnoses on their approved list for this CPT code. Sometimes providers are one digit off from the correct code. Go to their website and choose one of the diagnoses that they have approved on their list.

2. Claim/service denied/reduced because this procedure/service is not paid separately or is included in the surgical fee.

What they really mean is that you have chosen two procedure codes that are on the CCI list that are not compatible. Most insurance companies utilize the CCI edits and have them built into their computer logic. What are CCI edits? CCI or NCCI is the national correct coding initiative developed by CMS to create standard coding rules and make sure claims are not improperly paid. Every office should have a copy of these edits and you can download one free at http://www.cms.hhs.gov. The edits are listed by service categories because there are so many of them. They will show which codes when billed together will be paid and which will not be paid. I recommend doing a self audit by taking your coding and comparing it to the tables. This may help you identify potentially thousands in lost earned income.

3. Service pending or not considered. Requested information not received. Unfortunately, you will have to call the insurance company on this one to find out what information they are talking about. It could be operative notes from you or a questionnaire asking about other insurance coverage or dependant eligibility that they sent to the patient. If they are requesting information from the patient, don’t assume that the patient has received notification and sent it in. Call the patient as a friendly reminder to get that information in to their insurance company.

Inevitably, your practice will want to prevent denials before they happen. This would include creating a process to avoid claim denials and a claims recovery process to address claims that deny. An ongoing process for monitoring trends in denials would be very beneficial. Remember, addressing denied claims is important and necessary to your bottom line.