It has been several weeks since HIPAA 5010 became the required electronic transaction standard, and by now many practices are beginning to see how the many changes are impacting claim rejections. For the past couple of weeks, I have been monitoring trends in claim rejections—specifically looking at ones that are directly related to 5010. As can be expected, there has been an uptick in a number of rejections. Within all of these rejections, five specific ones caught my eye because each one could easily be corrected so practices can avoid such rejections in the future. Here is a quick look at these five rejections and how to prevent them:

1. No Medicare Secondary Payer (MSP) reason code on a primary claim. In Version 4010, claims only required MSP on secondary claims submitted directly to Medicare. Now, however, healthcare providers must submit an MSP indicator on both the primary and secondary claim when Medicare is reported as the secondary payer. If this information is not included, the claim will be rejected.

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Every practice wants to get paid faster. With the many moving parts involved in the revenue cycle, this may seem like a lofty goal. However, there are some specific things practices can do on the front end to speed up payer reimbursement. For example, practices can proactively verify eligibility, support timely charge entry, and use technology to streamline claims submission and payment.

Here are a few suggestions for effectively using these strategies to speed up payer reimbursement:

• Proactively verifying eligibility: Ideally, you should verify patient eligibility two to three days prior to the scheduled appointment. If your practice management system has the ability to create batch files, this is always recommended over real time eligibility verification. This will allow your practice to work by exception, only having to follow up on ineligible responses or same day appointments and new patients. Knowing a patient’s eligibility status prior to their appointment is one of the easiest ways to ensure a speedy reimbursement.

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Imagine you are driving a Ferrari at top speed through the Italian countryside. What is the last thing you want to see? Speed bumps! That’s what it feels like when you have to deal with claim rejections – it slows down your revenue. In addition, using staff time to fix and resubmit those claims can be a slow process – especially when your office is already pressed for time.

So how do you avoid these “speed bumps?” The first step is to identify which rejections are occurring most often and which are more than just a one-time occurrence. One of the easiest ways to start this analysis is by running a report through your clearinghouse’s software. If your clearinghouse does not offer this option, you will have to manually go through rejection reports and analyze them by hand.

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In today’s complex world of healthcare billing, practices can make some common—yet costly—errors that lead to incorrect billing, denied claims, and lost revenue. The good news is that many of these mistakes are avoidable with some adjustments to process, approach, and training.

Mistake 1: Incorrect data on the front end. This error often involves inaccurate patient demographic/insurance information or invalid insurance coverage. The main culprit: lack of verification. The best way to avoid this type of mistake is training, training, and more training! Staff responsible for patient check-in should be educated on the importance of collecting appropriate information and verifying insurance, as well as specific steps to accomplish these tasks. (Ideally, these processes should occur before the date of service to identify potential problems early, and to ensure patients understand their fiscal responsibilities.)

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Customer service is a big deal for ACT Health Management Services. We pride ourselves on offering quality client service to the 65-70 providers that make up ACT Medical Group of Wilmington, N.C. We expect the same dedication to service from our vendors, but unfortunately we haven’t always received it. In fact, lack of good customer support was one reason we left our former clearinghouse. We wanted a system with more robust and better functionality, as well as a business partner that would take our unique challenges as seriously as we do.

In 2010 we decided to go live with a new clearinghouse at the same time that we adopted an electronic health record (EHR). With two implementations going simultaneously, we discovered firsthand just how valuable a teamwork approach can be. When the inevitable snags delayed parts of our EHR installation, for instance, we ended up going live with our clearinghouse’s Electronic Remittance Advice (ERA) feature before we had any place to store the data. The situation could have been a nightmare, but it wasn’t. Our clearinghouse was supportive throughout the process, helping us develop the necessary “workarounds.”

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This is the first in a series of articles that will answer some commonly asked questions about different aspects of the revenue cycle.

Today, more than ever, practices are focusing on ensuring they have a strong revenue cycle – this includes making sure denials are minimized and appealed when appropriate. Today, we are answering some of the most commonly asked questions about denied claims and the appeals process:

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Practices nationwide are being asked to accept more financial responsibility with patients and payers. As you tackle these challenges, it’s more important than ever to ensure your workflow is running at an optimal level. In this complimentary learn six specific workflow strategies that can help any practice improve overall efficiency, which will ultimately strengthen a practice’s bottom line.

Join us on Wednesday, May 25 at 1:00 PM EDT, for a free webinar: 6 Workflow Tips to Improve Practice Efficiencies.

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Thank you to everyone who joined us on April 20 for our latest webinar, Hidden Denials and Appeal Letters: Tips and Tricks to Maximizing Your Reimbursement. During this one-hour, industry expert, Tammy Tipton, president of Appeal Solutions, Inc. the leading denial management training and resources company, discussed: what the hidden denial effect is and how to detect revenue lost to hidden denial; tactics to identify payer-specific hidden denials and tips for dealing with payers; and best practices for writing appeal letters.

To learn more about hidden denials and avoid letting them become a revenue drain, click here to download the recorded webinar.

*This program meets AAPC guidelines for 1.0 Core A or 1.0 CPCO specialty CEUs. On Demand product requires successful completion of a Post-Test for continuing education units

Despite every practice’s best efforts and best practices, not every claim is 100% clean of errors when it is first submitted – and that is OK because an effective and efficient clearinghouse should be able to help you catch many of these errors before the claim is ever sent to the payer.

Even if your clearinghouse catches a majority of errors, it is essential for all practices to know if a claim was rejected by the clearinghouse’s edits or by the payer’s edits. This knowledge is important to a healthy bottom line because rejections slow down revenue.

Given the choice between the two types of rejections, I always think that it is preferred to have your clearinghouse catch claim errors rather than the payer. At this point, people often ask me why one type of rejection is better than any other. The answer is simple – time. If you submit a bad claim to a clearinghouse – a good vendor will edit it and, if there are any edit errors, they will let you know very quickly—within minutes. Otherwise, it will take some time (possibly days or weeks) for the claim to go out to the payer, fail payer edits, and then return to you for your review. All of these steps take time, which slows down your revenue stream.

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Keeping track of prior authorization policies is difficult. Each health plan has its own set of requirements, which often change with regularity. Some Medicaid payers, for instance, want one “blanket” referral authorization before patients see certain specialists; the specialist isn’t required to obtain prior authorizations for every procedure. Other plans are much more restrictive, approving prior authorizations for specified procedures only when certain criteria/diagnosis’ are met.

The problem, of course, is that failure to obtain proper authorizations can have a drastic affect on practice income. The bottom line is simple: no authorization, no payment. Insurers won’t pay for procedures if the correct prior authorization isn’t received, and most contracts restrict you from billing the patient as well.

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