Claims denials have the following outcomes, none of them good:
Collection of revenue is delayed
Collection for the service never happens
Staff members spend time and energy researching and resubmitting claims
The denial is lost in the A/R system and never worked
There are many sources of denials, some caused and controlled by the practice, and some by the payer. The goal of denial tracking is two-fold: allows you to see the causes of denials within your practice's control and improve your systems and allows you to negotiate contract termswith payers for inappropriate claims processing.
However, if you categorize your denials broadly, "Medicare adjustment" or "My Best Insurance Company adjustment" you will lack the data you need.
Categorize your denials with more specificity and detail. Post all denials, even if the follow up will happen later. Don't simply fix and resubmit or you won't collect the data you need to learn from the denials and improve your work processes. Use reason codes that explain the reason for the denial, and that can be rolled up into broader categories.
For example, registration errors can include eligibility, benefit and referral errors, as well as keying errors.
Coding errors can include modifier use, bundling errors, diagnosis code errors,units, and deleted CPT® codes.
Payer processing errors might occur if they pay the wrong number of units, pay incorrectly based on NCCI, or don't recognize standard CPT® modifiers and their uses.
Collect the data by volume, dollar value, payer, provider, etc.
After you have collected this data, you can use it to give feedback to your staff, and to improve the billing process in your office. If you find that a particular payer always processes certain types of claims incorrectly, and that it costs you significant revenue, use that information when re-contracting with the payer.
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