After 18 years managing all aspects of the revenue cycle within the healthcare industry, I’ve noticed many practices often submit claims to insurance companies only to later receive a denial because they didn’t include a key element that the payer requires—an element they didn’t even know had to be included. In frustration, the practice fixes the issue and resubmits the claim, then moves on to the next claim. This effort costs valuable time and delays cash flow. But what have they learned?
The key to effective cash flow is to really manage denials, not just resubmit claims. In today’s healthcare environment, it’s important for practices to avoid examples such as the one above by taking just a little time to understand claims processes from the payers’ perspective. After all, payers don’t decide the care a patient should receive. Their role is simply to: 1) identify what they will reimburse, and 2) set guidelines for how they will reimburse.
By appreciating how payers approach their responsibilities, you can gain a better understanding of what you can and can’t bill for, as well as how to prepare claims appropriate to each payer. Knowing the role of payers and their requirements is the first step toward helping practices and payers work better together—which ultimately can improve the efficiency of your reimbursement process and speed up your cash flow. It can also support better patient satisfaction and care.
For example, think about a patient who shows up at your practice for a procedure, only to be kept waiting while you figure out whether his or her insurance company will reimburse for it. Or, even worse, consider the patient who undergoes a procedure and later receives a large, unexpected bill because the procedure wasn’t covered. The patient may have had a wonderful care experience that is then overshadowed by a billing blunder that significantly impacts his or her overall satisfaction.
There is no doubt about it: Understanding how payers work is a challenge. It’s complicated. But the more you know, the easier it is to put processes in place to submit clean claims, effectively manage denials and improve your cash flow.
About the author
Ginny Shipp is a Revenue Cycle Management Consultant with 18 years of experience in the healthcare industry. Prior to starting her own consulting firm, she was the co-founder of The Trillium Group, Ltd., a medical billing company in Atlanta.