Most practices pay plenty of attention to how quickly claims are submitted. The clock is always ticking, and it’s no wonder why. Cash flow—the financial lifeblood of every practice—is at stake.
Too often, though, this intense focus on the speed of upfront claims submission means that any back-end analysis of claims denials takes a back seat. While that might seem like prudent prioritizing, a recent MGMA In Practice Blog post points out why practices may want to reconsider those priorities.
How to Avoid ‘Unclean’ Claims notes that most practices don’t analyze denied claims; a practice that can help to uncover—and prevent—the underlying problems that create the denials. Unfortunately, practices pay a price for this decision. Studies show that on average it costs $25 just to rework one denied claim, so the math is pretty clear: A practice that reworks 100 denials a month will spend an average $2,500/month or $30,000/year in staff time and resources.
Fortunately, that’s not a cost practices have to bear. Tools exist that can easily help practice managers run reports and pinpoint why claims are bouncing back.
Some receivables management tools, for instance, provide swift access to payers’ denial reason and remark codes. Using this insight, practices can look for common patterns, and from there work backward to evaluate the specific codes, coders, providers, policies or processes causing the trouble. From there, it’s often a simple matter of education or communication to fix the problem—and stop future denials.
In the continual rush to get claims out the door, it’s all too easy to lose sight of the importance of denials analysis. As Frank Cohen says in the MGMA blog post: “The most important thing to do when it comes to denied claims…is taking the time to address them.” From resource utilization to the bottom line, taking the time to analyze your denial trends can pay off handsomely.