5 Ways to Reduce Claim Denials… and One Important Reminder

 These 5 strategies will help you keep more of the money you work so hard to earn. 

Claim Denials: How Payers Keep You from Your Hard-earned Money

Health insurance companies aren’t known for making life easy for those in the medical profession. Through their claim denial process, they can make a particularly deep dent on the bottom lines of behavioral, mental health, and chemical dependency clinicians.

Even if you’re a seasoned professional — but especially if you are new practitioner — it’s easy to make costly mistakes that result in claim denials. After all, most of your time belongs to your patients. Their care and well-being comes first, while business processes and procedures simmer on the back burner. But you can’t monitor what you don’t measure, and inattention to the business of your business means you won’t know how much money you lose every month. Take claim denials, for example. They are the insurance companies’ first, and often most effective, tactic to keep you separated from your hard-earned money.

Make these five strategies part of your business routine right from the start to make it as difficult as possible for them to deny your claims and maximize your monthly revenues.

#1

Mind Your Credentials and Registrations

To comply with HIPAA and medical licensing regulations, your facility itself, and all staff connected with it need to be registered and credentialed with every insurance company that you want to be able to accept. For a new facility or new practitioner, the registration and credentialing process takes an average of anywhere from three to six months, but it might take longer. It can also be denied altogether. Plan accordingly. If you see patients before your credentialing and registrations are complete, insurances companies can deny all of those claims from that period.

• Follow the credentialing and registration process required by each individual insurance company.
• Remember to get any new clinicians or staff registered and credentialed as soon as you hire them.
• Review all of your credentials and registrations annually to catch lapses and reapply when necessary.

#2

Establish a Thorough Intake Process — and Make It a Habit to Check Your Clients’ Insurance Frequently

It’s routine for all medical professionals who accept health insurance to collect their new clients’ insurance information. In fact, we’d recommend that you have your new client intake form on your website for new clients to fill out before their first appointment.

Here are the insurance-related questions that need to be answered to ensure that you can bill with confidence:

• Is the client’s insurance active?
• Does it covers the services they are seeking?
• If the client is seeking treatment for chemical dependency, how many treatments will the insurance company authorize?
• Make a note to check coverage regularly during treatment. Some facilities make it a part of every patient check-in to review their insurance. For example, coverage can lapse or change in a substantive way, especially as employers make changes to the plans they offer at the end of a fiscal or calendar year.
• If a Medicaid client is on a Prepaid Medical Assistance Plan (PMAP), note that on their file and encourage them to submit their paperwork to the state or county every month. Why? Because providing that paperwork to the government entity administering the PMAP is your client’s responsibility, and failure to keep this paperwork current with the state or county will result in the PMAP provider rejecting all claims. Those claims will then go back into the state Medicaid pool, which does not pay providers as much as PMAP plans.

#3

Request Re-authorizations for Additional Substance Abuse Treatment Services Before You Reach Your Authorization Limit

Private insurance companies that cover substance abuse treatment do so by authorizing a certain number of visits. Similarly, state Medicaid programs require that
clinicians file special paperwork — in Minnesota, the Medicaid form is called the Drug +Alcohol Abuse Normative Evaluation System, or DAANES — to establish a pre-treatment, post-treatment, and often even a during treatment plan, based on how long a clinician estimates treatment will take. For example, an insurer or a Medicaid administrator may pre-authorize 20 sessions to start.

Get in the habit of pre-scheduling all authorized treatments and making a note to seek re-authorization at least a week before you reach the authorization limit. Then follow this same procedure with each subsequent re-authorization. Insurance companies, in particular, will usually deny claims for unauthorized treatment sessions, but will pay the claims when you resubmit them under subsequent re-authorizations. By getting ahead of the insurance company’s authorization process, though, you won’t ever be left waiting for your payments.

#4

Make It a Habit to Bill All Insurance Companies for All Behavioral/Mental Health Services Every Day (If Allowed)

Every insurance company has the right to set its own “timely filing” standards. Those standards can range from 90 to 120 or even to 365 days or more.

Take this situation, for example:

  • An insurance company has a 90 day limit
  • You put off billing for 60 days (90-60=30)
  • The insurance company takes 10 days to deny a claim…and you don’t get notified of the denial for 2 Days (30-10-2=18)
  • You now have 18 days to fix an issue that you find out will take a minimum of 4 weeks to resolve (18-21 = -3)

Now ask yourself how much treatment you can afford to give away, because this is the formula for a revenue write-off.

By knowing your insurance companies’ and state’s Medicare/Medicaid timely filing deadlines and by committing to routinely billing every day, if allowed, you buy yourself the time you may need to fight denials with enough time to beat the insurance company’s timely filing deadline.

#5

Flag Substance Abuse Treatments and Group All Daily Client Sessions on One Bill

Because substance abuse treatment is pre-authorized, it doesn’t carry quite the same risk of denial. We’ve already covered getting re-authorized for additional treatment sessions before you reach the patient’s authorization limit.

There is one more rule to pay attention to when billing an insurance company for chemical dependency treatments. Multiple sessions for one client that take place on the same day — for example, three group sessions and one individual session — must be filed on one single claim. If a client received three group sessions and one individual therapy session on February 11, and you submitted one claim for two of those sessions on February 11 and then submitted a second claim on February 14 for the other two sessions that took place on February 11, your second claim would likely be denied as a “duplicate.”

Put all daily sessions for an individual client on one claim to ensure full payment and eliminate the likelihood of a denial. Again, this type of denial can often be fixed in the re-submission process, but it will definitely delay your payment and disrupt your cash flow.

Important Reminder

One of the quickest and easiest methods insurance companies use to interrupt your revenue stream is by denying your claim because you used the wrong billing codes. If chemical dependency patient has been authorized to receive treatment for alcohol addiction and you bill their claim with an opioid addiction code, your claim will likely be denied. Ditto for someone you have diagnosed with general anxiety and then accidentally bill as a patient with bipolar disorder. Insurance companies are sticklers for using the correct billing codes.

The Bottom Line

Bottom line? Check, double-check, and then triple check your billing codes before you submit a bill. Make it a habit and you’ll save yourself a good deal of frustration — and put money in the bank.

Insurance companies’ claims processes are designed to be complex. Some might even say labyrinthine and convoluted. That means it’s never too late — nor too early — to make understanding claims and write-offs a priority. If you implement these 5 tips — and keep your eye on the billing codes — you can make your way through the twists and turns of any claims process and prevent as many write-offs as possible.

Ready to Reduce Your Denial Rates?

Schedule a complimentary phone call with our team and we can help you start!

Let’s Talk!

We Promise

To assign one representative to your practice who will listen to you, learn from you, and serve you. 

To pursue payment on every claim denial, writing off that revenue only after we’ve pursued all possible avenues of resolution. 

To act in good faith by charging you only 6 percent of your collected revenues and zero startup costs, assuming a shared financial risk, and providing an additional incentive for us to advocate for your best interests.