HMO

HMO is a term health maintainance organization which means group of doctors will participate in the group (HMO) to various service to patients.

HMO require an authorization in order to see a specialist in case the PCP itself is not a specialist ,if PCP is itself specialist in the treatment no authorization needed.

In emergency case also no need of authorization in HMO, the main moto of the HMO is to provide the cost effective and affordable service at right.

Also HMO will have the periodic check up to prevent disease ,because periodic check up will allow a patient to find out how he was affected and according to that seviourity the treatment will be provided and cured .

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Insurance denial - INAPPROPRIATE BUNDLING OF SERVICES

"INAPPROPRIATE BUNDLING OF SERVICES" 

Description: 

This indicates a lack of awareness of the National Correct Coding Initiative Edits (NCCI) that govern appropriateness of tests being performed together on the same date of service. Alternately, it may indicate a lack of understanding of the appropriate code status of a specific CPT code. For example, payment for "B" status code services is always bundled into payment for other services, whereas with "C" status codes, the local carrier determines bundling and the appropriateness of the procedure and subsequent reimbursement.

Action:

Access the NCCI Edits on the Medicare Web site (http://www.cms.hhs.gov/NationalCorrectCodInitEd/) to review which codes can and cannot be billed together on the same date of service, as well as the appropriate modifiers to use in those situations. Also, familiarize yourself with the status code of the CPT procedure code you work with. These change at minimum on a quarterly basis.

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Insurance denial - Incorrect CARRIER

INCORRECT CARRIER 

Description: 
The claim was submitted to the incorrect payer/contractor for payment.

Action:

It's important to screen patients and be aware of the types of services provided prior to submitting a claim to the carrier. Check the patient's Medicare card and verify the Health Insurance Claim (HIC) number on the card. Patients with traditional Medicare coverage will have HICs of nine digits followed by an alphanumeric suffix. Patients who have railroad retirement (a type of federal health care coverage) will have HICs with an alpha prefix followed by either six or nine digits. Verify whether a Medicare-replacement Health Maintenance Organization (HMO) covers the patient. You can obtain this information by calling the Provider Service department, or online via your carrier's Web site. Additionally, pay special attention to whether you have provided refractive services and are submitting a refractive claim with a refractive diagnosis to the refractive carrier, or whether you have provided medical eye care services and are submitting a medical claim to the medical carrier. If you are not a contracted provider for a carrier, always collect from the patient in full for all services and materials you provide. Help the patient get reimbursed for your services by offering to fill out and submit the claim on his or her behalf, but don't accept financial liability for a claim that a carrier has no legal obligation to pay.

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Denial claim - MEDICARE IS THE SECONDARY PAYER

MEDICARE IS THE SECONDARY PAYER 

Description: 

The care of a Medicare patient may be covered by another payer through coordination of benefits. Medicare may be the secondary payer in our offices for the following reasons:
* Working aged. The Medicare patient is: 65 years or older, employed full- or part-time by an employer who has 20 or more full- or part-time employees, and covered under the Employer's Group Health Plan (EGHP); or covered under the EGHP of an actively employed, full- or part-time spouse whose employer has 20 or more employees.

Liability and auto/no-fault liability: Section 953 of the Omnibus Budget Reconciliation Act of 1980 was amended by the Deficit Reduction Act of 1994. It precludes Medicare payment for items or services to the extent that payment has been made or can reasonably be expected.

* Where the primary claim should be filed under auto, medical, Personal Injury Protection (PIP), no-fault, worker's compensation, or any liability insurance plan or policy including self-insurance plans.

* Workers' compensation: Medicare will be the secondary payer for work-related illnesses or injuries covered under a workers' compensation plan.

* Veteran's Affairs (VA): VA records are set-up by information received by the Social Security Administration. Veterans who are entitled to Medicare may choose which program will be responsible for payment of services covered by both programs.


Action :

Obtain routine information concerning the working/retirement status of each Medicare patient with each visit. Be sure to stay updated. Contact your Service Provider department about potential conflicts and the appropriate coordination of benefits.

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Medicare EOB - PR - 3 Co-payment Amount

PR - 3 Co-payment Amount


Description:
Copayment A specified dollar amount or percentage of the charge identified that is paid by a beneficiary at the time of service to a health care plan, physician, hospital, or other provider of care for covered service provided to the beneficiary.

Cost Sharing The general set of financial arrangements whereby the consumer must pay out-of-pocket to receive care, either at the time of initiating care, or during the provision of health care services, or both. Cost sharing can also occur when an insured pays a portion of the monthly premium for heath care insurance.





Action:

1. We need to bill the patient.
2. If there is any other insurance coverage if the patient has, we can bill to that insurance also.

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Adjustment code - CO and CR - What does it mean

Adjustment Group Code Glossary for "CR" 

CR - - Correction to or Reversal of a Prior Decision

A CR group code is used whenever there is a change to a previously adjudicated claim. CR explains the reason for the correction; PR, CO and/or OA must always be used in tandem with CR to show the revised information. Separate reason code entries must be used in the NSF for the CR group entry, and any other groups that apply to the readjudicated claim.

What is explanation for denial adjustment group code of CO


CO - Contractual Obligations


A CO group code identifies amounts for which the provider is financially liable. These include, participation agreement violations, assignment amount violations, excess charges by a managed care plan provider, late filing penalties, Gramm-Rudman reductions, or medical necessity denials/reductions. The patient may not be billed for these amounts.

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Claim processed as PR - 2 Coinsurance Amount

PR -  2  Coinsurance Amount

Coinsurance amounts are generally 20% of the Medicare fee schedule. Physicians must collect the unmet coinsurance from the beneficiary. Consistently waiving the coinsurance may be interpreted as program abuse. If a beneficiary is unable to pay the coinsurance, the physician should ask him or herto sign a waiver that explains the financial hardship. If no waiver is signed, the beneficiary ’ s medical record should reflect normal and reasonable attempts to collect, before the charge is written off.

Action :  

1. We need to file the claim to secondary insurance
2. If there is no secondary insurance we can bill the patient.

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what is ANSI Group Codes

ANSI Group Codes


An ANSI Group Code is always shown with each ANSI reason code to indicate when you may or may not, bill a beneficiary for the non-paid balance of the services or equipment you furnished. Group codes are not used with Medicare Reference (REF) or Medicare Outpatient Adjudication (MOA) remark code entries.

CO -  Contractual Obligations
PR -   Patient Responsibility
OA -  Other Adjustment
CR -   Correction to or Reversal of a Prior Decision
PI - Provider initiated refund

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Insurance denial - CO 39 Services denied at the time authorization/pre-certification was requested.

CO 39 Services denied at the time authorization/pre-certification was requested.

AUTHORIZATION/REFERRAL PROBLEM

    Action:  Some carriers insist on obtaining prior authorization from them before the surgery.  This may be for certain specific procedures or may even be for all procedures.  So these are carrier specific and procedure specific.  Please note that it is the responsibility of the Surgeon and not the patient to obtain the authorization# from the carrier.

    When you get a denial from the carrier for this reason, first check the system to see if any note entry has been made for the patient for the dos concerned and for the procedure in question. Always read the entire notes since the claim might have already sent for reprocessing. Same goes for other types of denials  also. Pull out the original file and see if there is any auth# for the procedure and also pull out the original file received with the consult and check if we have received any auth# and if we have received, does the auth cover the procedure, that is check if diagnostic testing is marked and also check for the number of visits covered and the period it covers and communicate the same. If a valid auth# is found indicate the same and refile the claims, else mention the source file name and pg# of the original file along with the PCP’s name and phone #.So that we can get the Auth # for the same.

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Insurance claim processed as PR - 1 Deductible Amount

PR - 1 Deductible Amount



Descripition:

In insurance policy terms, a deductible is the amount of money which the insured party must pay before the insurance company's own coverage plan begins. In practical terms, insurance companies include a deductible in their policies to avoid paying out benefits on relatively small claims.


Action : 

1. We need to bill the patient.
2.  If the patient has another insurance coverage which covers deductible we can file to that insurance, if the policy not cover primary deductibles we have no other way rather than billing the patient.

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What is PR and OA - denial EOB

What is explanation for denial adjustment group code "PR"  


PR - Patient Responsibility

A PR group code signifies the amount that may be billed to the beneficiary or to another payer on the beneficiary’s behalf. For example, PR would be used with the reason code for patient deductible or coinsurance, if the patient assumed financial responsibility for a service not considered reasonable and necessary, for the cost of therapy or psychiatric services after the coverage limit had been reached, for a charge denied as result of the patient’s failure to supply primary payer or other information, or where a patient is responsible for payment of excess non-assigned physician charges. Charges that have not been paid by Medicare and/or are not included in a PR group, such as a late filing penalty (reason code B4), excess charges on an assigned claim (reason code 42), excess charges attributable to rebundled services (reason code B15), charges denied as result of the failure to submit necessary information by a provider who accepts assignment, or services that are not reasonable and necessary for care (reason code 50 or 57) for which there are no indemnification agreements are the liability of the provider. Providers may be subject to penalties if they bill a patient for charges not identified with the PR group code.

Adjustment Group Code Glossary "OA"

OA -  Other Adjustment 

An OA group code is used when neither PR nor CO applies. At least one PR, CO or OA group code appears on each remittance advice. For example, OA would be used when a claim is paid in full at initial adjudication with reason code 93 and a zero amount, or with reason codes such as 69-85 that are components of payments rather than adjustments to payments. Neither the patient nor the provider can be held responsible for any amount classified as an OA adjustment.

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Insurance denial - CO 146 - Payment denied because the diagnosis was invalid

CO 146 - Payment denied because the diagnosis was invalid for the date(s) of service reported.


Description:
The following types of rejections are possible; Diagnose code does not match with the procedure code (check in LMRP). The Diagnose code reported on the claim is not to the highest level of specificity. Diagnose code is no longer valid.  


    Action: Check the charge sheet as to whether the rejection is due to wrong keying in at the time of charge entry, if yes, then correct it and resubmit the claim.  If no, it may be because of incorrect Diagnose code. It is possible that the 4 digit Diagnose code used is not the highest level of specificity and the carrier wants a five digit Diagnose code. Coders will also have to recheck to see if the diagnosis code used has been deleted, if it matches with the procedure code and if it is of the highest level of specificity and if not find the right diagnosis code, and submit the claim with the correct diagnosis code.

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Insurance denial -CO- 182/CR - 182 Payment adjusted because the procedure modifier

CO- 182/CR - 182 Payment adjusted because the procedure modifier was invalid on the date of service.


Definition :MODIFIER REQUIRED/INVALID MODIFIER

 Action:   First check whether modifier has been entered at the time of charge entry. If no, then resubmit the claim with the correct modifier. If modifier has been entered but the carrier rejects the same then check whether the correct modifier has been used. If you find that the correct modifier has been used, then call the insurance and find out the reason for rejection. Based on the feedback, take corrective action. One example, Blue choice (New York) rejected a lot of claims for the reason invalid or missing modifier. Carrier was called and it was found that they do not require modifiers hence forth and claims need to be billed without modifiers.

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Insurance deny the claim - PROVIDER NUMBER IS MISSING OR INCOMPLETE

PROVIDER NUMBER IS MISSING OR INCOMPLETE 

Description: 

CMS1500 form Items/Box #24K and #33 are filled out incorrectly, with the UPIN (unique provider identification number) or information is missing, thus causing a denial of the claim.

Action :

 For item 24K, enter the personal identification number (PIN) or national provider identifier (NPI) of the performing provider of service/supplier if you are a member of a group practice. When several different providers of service or suppliers within a group are billing on the same form CMS-1500, show the individual PIN or NPI in the corresponding line item.

For item #33, enter the provider of service/supplier's billing name, address, ZIP code, and telephone number. These are required fields. Enter the PIN (or NPI when implemented), for the performing provider of service/supplier who is a member of a group practice. Suppliers billing the DMERC should use the National Supplier Clearinghouse (NSC) number in this item. Enter the group UPIN, including the two-digit location identifier, for the performing practitioner/supplier who is a member of a group practice

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Denial claim reason - MISSING A MODIFIER OR HAS AN INCOMPLETE OR INVALID MODIFIER :

THE CLAIM IS MISSING A MODIFIER OR HAS AN INCOMPLETE OR INVALID MODIFIER :

Description: 

The modifier necessary to process the claim correctly is either missing, incomplete, or invalid for the specific procedure and diagnosis indicated on the claim form.

Action:

Know the proper use of the CPT modifiers that exist and are appropriate to use for the specific condition or situation. The CPT modifiers are listed in their entirety in Appendix A of the current version of the CPT Manual. You can obtain the CPT manual from the American Optometric Association or from the American Medical Association. You should also know that misuse and abuse of modifiers are under the scrutiny of the Office of Inspector General (OIG) and that can result in significant penalties.

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Insurance denial - IMPROPER DIAGNOSIS or INCORRECT DIAGNOSIS

IMPROPER DIAGNOSIS or INCORRECT DIAGNOSIS

Description:
Services were denied because the diagnosis listed as primary was not a covered diagnosis for the procedures performed.

ACTION:

Check your specific carrier's local coverage determination (LCD) policy for the specified procedure to obtain a list of covered diagnoses, generally found on their Web site, or accessible on Medicare's Web site. Also familiarize yourself with the appropriate policies for medical necessity and documentation requirements. Be cautious of automated programs/software that provide a covered diagnosis for any given procedure. Keep in mind that having a covered diagnosis does not mean you can automatically perform any procedure for which the covered diagnosis exists. You must prove and document the reason in the medical record to justify doing the procedure. For example, let's look at doing routine anterior segment photography because your patient presents with allergic conjunctivitis. Despite having a "covered diagnosis" for taking the photo, there most likely is insufficient medical necessity to take an annual photo of the allergic eye.

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Eligibility related denial claim

Denial - BENEFICIARY ELIGIBILITY 

Description: 

You submit a claim for processing and the beneficiary/patient does not have Medicare eligibility. Claims are often denied for eligibility for the following reason:
* The beneficiary Medicare number is invalid on the claim.
* The beneficiary is not eligible to receive Medicare benefits.
* The beneficiary's claims must be filed to another insurance plan.



Action :
Screen your patients. Verify the Medicare number on the patient's Medicare card and file the claim exactly as it is printed on the card. Verify the patient's effective date for Medicare Part B from their Medicare card. Medicare cannot pay for services prior to the patient's effective date and will not pay for services if the patient has terminated his Medicare benefits. Beneficiaries who enroll in a Medicare "replacement" HMO must be submitted to that insurance plan instead of Medicare Part B. To obtain Medicare eligibility, call your carrier's Provider Service department.

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Dispute insurance denial - How to write appeal

How to Write an Appeal

You may find that an effective appeal letter will often be all that is needed to reverse a claim denial or underpayment. Prior to writing an appeal letter, make sure you examine the EOB, also known as the Remittance Advice Notice, and the initial claim in detail.

The Appeal Letter

Be sure to reference all key elements in your letter and include documentation supporting your appeal as attachments. Documentation might include the following: approved prescribing information (PI), copies of the EOB or remittance notice in question, articles from peer-reviewed medical journals,

relevant peer-reviewed literature, payer coverage policies, fee schedules, medical records, nurses’ notes, plan of treatment, consultation reports, and/or progress notes.

Make certain that the claim is reviewed by a person with strong medical knowledge. You can request that a claim be sent to the payer’s Medical Review department or Medical Director.

In 30 days, follow up on all appeal letters with a telephone call to check on the status of the appeal.

Elements to Include in an Appeal Letter

1. Opening Paragraph: Inform the payer that you are appealing a denial or underpayment. List the payer’s reason for the denial as indicated on the EOB. Or, if you are appealing an underpayment, provide the amount that your office charged, the payer’s allowable, and the amount actually paid. When available, attach a copy of the payer’s fee schedule for the drug or service in dispute.

2. Patient History and Treatment Rationale: In the second paragraph, describe the patient’s condition and the treatment. Explain why the drug was prescribed, including outcomes from the treatment. In addition, you may reference outcomes of other patients with similar conditions who

received the same treatment.

3. Documentation: Appropriate documentation can help support and win appeals.

Examples of appropriate documentation include:

 Medical history

> Office notes and progress reports

> Hospital notes

> Operative reports

> Consultation reports

> Referrals

> Documentation of severity or acute onset

> Test results

> X-ray reports

> Plan of treatment

> Physicians’ orders and nurses’ notes

> Copies of communications between provider and patient/beneficiary, hospital, carrier,

laboratory, etc

> Compendia monographs (USP-DI/AHFS) and peer-reviewed literature supporting product’s use

> Documentation that your appeal is being filed within the appropriate time limit (6 months for Medicare claims)

4. Cost-Savings: Payers like to know that they are not only approving payment for quality and medically necessary services, but also that those services are cost-effective. Let the payer know that the consequences of allowing the patient’s condition to advance could possibly require more costly treatment and hospitalization, which could be avoided with the physician-specified treatment.

5. Conclusion: Inform the payer that this information supports your professional opinion and is cost-effective; that they should cover the denied charges or adjust the amount reimbursed.

6. Copy Others: It may also be a good idea to copy others on the appeal letter. You may want to copy the Medical Director, patient, CAC member, local oncology society administrator, ASCO, union representative, local legislator, insurance commissioner, etc.

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What is clean claim

A “clean” claim is defined as a one that does not require the payer to investigate or develop on a prepayment basis. Clean claims must be filed in the timely filing period.

Most payers consider clean claims as:

◆ Claims that pass all edits

◆ Claims that do not require external development (i.e., are investigated within the claims, medical review, or payment office even if the investigator does not need to contact the provider, the beneficiary, or other outside source)

◆ Claims not approved for payment by the common working file (CWF) within seven days of the original claim submittal for reasons beyond the carrier’s or provider’s control (e.g., CWF system/communication difficulties) (Medicare only)

◆ Claims where the beneficiary is not on the CWF host and CWF has to locate and identify where the beneficiary record resides (CWF out-of-service area [OSA] claims) (Medicare only)

◆ Claims subject to medical review but complete medical evidence is attached by the provider

◆ Additional requests for information is developed on a post payment basis

◆ Have all basic information necessary to adjudicate the claim, and all required

supporting documentation is attached

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Dispute insurance denial - Types of hospital Denials

Insurance claim denials generally fall into 2 major categories: claim-level denials and service-level denials. Medicare and Medicaid have created a set of status codes to indicate why claims have been denied. Appropriate hospital staff members involved in billing and coding should be familiar with these

codes and what they mean to the organization. Code information can be found at the CMS Web site: www.cms.hhs.gov/manuals/IOM/list.asp.

Denial of the entire claim is considered a claim-level denial. For many hospitals, this type of problem accounts for the majority of Medicare and Medicaid denials and typically results from inaccuracies related to patient registration, late-charge management, duplicate billing, production of medical

information for external review, and/or physicians’ ordering practices. Common denial types include the following:

> The patient was not identified as insured

> The claim submitted was a duplicate

> The services were deemed by the payer as not medically necessary

> The charges for outpatient services were in proximity to inpatient services

> The patient’s date of death preceded the date of service

A service-level denial occurs when any portion of the claim associated with an individual service is denied. Service-level denials often result from problems with patient registration, questions of medical necessity, issues related to local medical review policies, and inaccurate diagnostic and procedural

coding processes. Typical reasons for denial include:

> The claim is denied based on diagnosis

> The procedure code used is inconsistent with the modifier, or information is missing

> The service is considered not medically necessary by the payer

> The service is not paid separately. Problems with claims that originate during patient registration are common because this function is decentralized in many healthcare organizations, particularly for outpatient services. Therefore, denied claims often result from process breakdowns due to inadequate interdepartmental communication or failure to learn from the experience of previous denials. Repeated denials within hospital systems occur frequently for the same patient and typically happen for several reasons. For example, the registration staff may be using out-of-date demographic data and may not be informed of the original denial. Denials related to deceased

patients are often due to poor management of late charges, as these charges may be entered into the system using the date of data entry as the date of service instead of listing the actual date the patient received treatment. Denials related to medical necessity and failure to provide information

are usually due to inaccurate diagnostic coding (ICD-9) and/or insufficient medical record documentation to support the services billed

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Hospital Denials - review

Today, as hospitals face tremendous reimbursement challenges, many facilities are adopting best
practices in denials management. This approach helps to recapture the full value of the services they
provide to patients.

Most hospitals recognize that resubmitting a claim does not solve their claims denial problems and are
seeking to quantify the issue to improve overall claim payments. With this goal in mind, more and more
hospitals are forming denial recovery units, maintaining denials databases for tracking and trending
purposes, automating where possible, and centralizing operations to increase efficiency and decrease
error rates.

The Medicare Hospital Outpatient Prospective Payment System (PPS) created under the Balanced Budget
Act of 1997 has increased pressure on hospitals to bill accurately for outpatient hospital services. Under
PPS, the Medicare payment methodology was changed first from a cost-to-charge ratio structure to a
prospective payment system for services based on historical claims data per Current Procedure
Technology (CPT) or the Healthcare Common Procedure Coding System (HCPCS). This change represents
a dramatic shift in the billing process for hospitals, as the majority of these codes are generated through
the charge description master, rather than through the health information management department. This
transfer in coding responsibility without commensurate training, support, and monitoring of staff
involved is perhaps the greatest cause of service-level denials for outpatient claims today.

In addition, hospitals may be confronted with additional payment cuts, estimated at $21 billion over the
next 5 years, if Congress does not enact legislative changes to correct the existing payment structure.
To remain viable in this challenging environment, hospitals must take a closer look at the claims denial
issues they face internally.

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Avoiding denial - claim review before submission

Common Problems and Solutions

When a denial or underpayment is received from a payer, it’s often necessary to review the original claim
submitted to the payer along with the EOB to identify and correct the problem. By doing this type of
analysis, you can determine if there was a simple coding error or if the denial was based upon
something else, such as the payer’s coverage policy on a specific procedure or product. Here are some
items to keep in mind when reviewing the original claim and EOB.

1. Original Claim Analysis

> Review the claim to ensure that all codes are complete and accurate

—ICD-9-CM codes are listed and coded to the highest level of specificity
(don’t use a truncated ICD-9-CM code when a more specific code is available)

—ICD-9-CM codes are linked to each service line on the claim form

—J and Q codes for drug products are listed and units are accurately billed

—CPT codes reflect the services provided during the patient encounter

—Modifiers are used as necessary

—The most recent volumes of each of the coding books are used as a reference;
out-of-date codes can result in denials
> Examine your charges; most payers will reimburse the lesser of their allowable or your charges

—Verify that date of service and place of service are correct

—Include correct names and provider identification numbers of both referring and treating
providers on the claim

—Be sure you’ve billed the right payer, especially if the patient has primary and secondary insurers

—Confirm you have the signature of the patient on file and the treating physician’s signature on
the claim

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Insurance claims recovery process

Claims Recovery

A claims recovery process is essential and should incorporate all traditional processes to recover the denied payment, including informal reviews, fair hearings, administrative law judge hearings, appeal council hearings, and federal district court hearings. All levels of appeal have specific timelines,

document requirements, and dollar limits. A cost-benefit analysis should be used to determine the level of resources needed to pursue the denied claim. Use the following tips to assist each facility with claims recovery:

> Establish a department coordinator to direct all communications regarding claims recovery. This team member will ensure an efficient and timely appeal process

> Understand and meet all payer requirements for information submission. Failure to meet these timelines will result in automatic denials

> Designate one contact person to communicate with Medicare, Medicaid, and each commercial insurer

> When an employee specializes in one specific payer, he/she is more likely to be familiar with  payer-specific requirements regarding appeals and information submission

> Focus appeal efforts on denials with the greatest likelihood of being reversed

> Develop a template for appealing denials questioning medical necessity

> Reach out to patient assistance programs for appeals support. Such services can reduce time and effort on the part of the hospital and increase the likelihood of successful appeals

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How to success in denial management

Claims Denial Management

Claims may be denied or underpaid for a variety of reasons.

Common reasons for denial or underpayment may include the following:

> Clerical errors, such as misspellings and transposed numbers

> Questions about medical necessity

> Improper use of diagnosis codes

> Incorrect procedure codes and/or modifiers

> Missing information

> Incorrect billing units

Insurance payers typically have a formal process that permits providers to appeal denied claims or inadequate reimbursement for drugs and/or services. If your claim is denied, you will receive an EOB from your local insurance claims processor explaining the reason(s) for noncoverage. You may resubmit the claim, requesting a redetermination of coverage. 

A well-written appeal letter can be very effective in obtaining appropriate reimbursement for a denied or an underpaid claim. Resubmitted claims should fully document the medical necessity for the patient in question and should include any supplemental information that may not have been included with the original claim.

Review Contracts Comprehensively

When assessing contracts, make sure the hospital can comply with the terms and identify provisions that might generate a high proportion of denials. Pay close attention to terms and limits for appeals. Members of the denial management team should participate in the hospital’s contract review process to ensure that contracts commit the facility to realistic and achievable goals from both contracting entities.

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How to review EOB - AR specialist

Explanation of Benefit (or Remittance Notice) Analysis

> Determine why the claim was denied by analyzing the denial codes, which are usually on the bottom or back of the EOB

> Cross-reference actual reimbursement from the payer to their allowables to determine if the claim was underpaid, paid correctly, or overpaid. Allowables are often published in provider bulletins or in your contract with the payer

> If the payer has changed any of your codes, you may want to go back and review how you’re using those codes and whether they are being used appropriately

> Take care to file appeals within the time constraints of the payer (for Medicare, the limit for appeals is 120 days from the date of initial denial); keep in mind that a payer may require a specific appeal form to be submitted

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Denial EOB example

 Here is the image for denial EOB from Medicare insurance.

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Top Five DME MAC Claim Denials for Podiatry Specialty

The top five denials below are for the period of October 2008 through December 2008. These claims were

identified from Specialty 48, which represents Podiatrists. The denials identified are for all of DME
MAC Jurisdiction A Suppliers

Top FiveClaim Denials     # of Denied Claims     Reason For Denial      

CO 96, N115                                       2,371     This decision was based on a Local Coverage Determination (LCD). An LCD provides a guide to assist in determining whether a particular item or service is covered. Non-covered charge(s)   

CO 18, N111                                      2,409     This service was included in a claim that was previously billed and adjudicated. No appeal rights are attached to the denial of this service to determine whether the service/item is a duplicate. Duplicate claim/service   

CO 58                                                   978     Treatment was deemed by the payer to have been rendered in an inappropriate or invalid place of service   

CO 4                                                        701     The procedure code is inconsistent with the modifier used, or a required modifier is missing    

CO 16, MA130                                         685     Your claim contains incomplete and/or invalid information, and no appeal rights are afforded because the claim is unprocessable. Claim/service  lacks information which is needed for adjudication

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When we need to appal and how to appeal the claims

The Appeals Process

When an insurer denies or underpays a claim, first examine the original claim and the Explanation of
Benefits (EOB) to determine whether there is inaccurate or insufficient information. Claims denied for
these reasons can simply be resubmitted with the corrected or additional data required.

Should a payer deny a claim for some other reason, consider filing an appeal. Industry sources indicate
that only 10% of claims are appealed, but that 90% of appeals are successful. In fact, according to an
Office of the Inspector General report, there has been an increase in appeals to Medicare at the
Administrative Law Judge (ALJ) level (99% increase); in these appeals, 81% of the initial denials
were overturned.

By law, all payers must have a procedure for filing appeals. Below is the process for filing an appeal for
claims submitted under Medicare Part B. The process begins with a request to review the claim and, if
needed, can progress to a hearing at various levels. Note time and claim limits on various levels of the
appeal process.


The Medicare Part B Fee-for-Service Appeals Process

Providers who disagree with a determination on a Part B claim have the right to appeal the claim.
When appealing a claim, the following information should be submitted:

> Beneficiary name
> Medicare Health Insurance Claim (HIC) number
> Date of initial determination
> Date(s) of service for which the initial determination was issued
> An explanation of why you have requested a review
> A copy of the claim and the EOB or remittance notice
> Supporting documentation
> Signature of the requester

The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) established a
process for the correction of minor errors or omissions without pursuing an appeal. Requests for
adjustments to claims resulting from clerical errors shall be handled and processed by the contractor
through telephone reopenings.

The Part B appeals process consists of 5 levels, as listed below. Each level must be completed prior to
proceeding to the next level of appeal. An appeal cannot be made until the provider receives an initial
determination from the Medicare carrier. Keep in mind that specific time constraints, as well as minimum
dollar amounts in controversy, exist at the various appeal levels


Appeal Level                            Time Limit                                                        Amount in Controversy

1. Redetermination*     120 days from date of receipt of the notice of initial determination     None    

2. Reconsideration by Qualified Independent Contractor (QIC)     180 days from date of receipt of the redetermination     None    

3. Administrative Law Judge (ALJ) Hearing     60 days from date of receipt of the reconsideration     At least $110    

4. Departmental Appeals Board (DAB) Review     60 days from date of receipt of the ALJ hearing decision     None    

5. Federal Court Review     60 days from date of receipt of DAB decision or declination of review by DAB     At least $1,090  

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Filing adjustment form of Medicare Tips for Filing Adjustments

The following tips will assist in completing the adjustment form

• Complete only one adjustment request form per claim; a separate adjustment request form for each line item on a single claim is not necessary.

• Reference only one ICN per adjustment request form.

• If requesting a review of a previously denied adjustment, reference the original ICN and resubmit with all supporting documentation related to the adjustment. Do not reference the ICN for the denied adjustment.

• Include a copy of the appropriate RA with each adjustment request. If multiple RAs were involved in the claim payment process, include copies of each RA.

• Include a copy of the claim that is referenced on the adjustment request.
Note: This is not required for electronically submitted claims.

• When the adjustment request involves a corrected or revised claim, send both the original and revised claim. Do not obliterate previously paid details on the claim.

• Include pertinent information on a separate sheet of paper. Do not write information on the back of the adjustment form, RAs, etc.

• Ensure that all of the information submitted with the adjustment request is legible.

• Send only the medical records that pertain to the services rendered. If it is necessary to send records with other information included, identify the portion of the record that is significant to the adjustment request.

• Only the claim that pertains to the payment or denial in question should be submitted with the adjustment request. Do not submit any other claims with the adjustment request. Claims for service dates that have not been submitted should be filed on a new day claim, including late charges for codes not previously filed.

• When submitting an adjustment to Medicaid due to a Medicare-adjusted voucher, attach both the original voucher and the adjusted Medicare voucher. Reference the ICN of the original voucher.

• If requesting a review of a previous partial payment or a partial recoup adjustment, reference the ICN for the adjustment and resubmit with all supporting documentation related to the adjustment.

• Adjustments equal to or less than $1.00 will be denied.

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most common mistakes - Filing adjustment form

The most common mistakes that are made when filing adjustments are these:

• Incomplete or invalid MID information or ICNs
• Multiple ICNs on the same form
• Unspecified or too-general reason for the adjustment request
• Missing copy of the RA related to the request
• Missing reference to the original ICN, or use of a denied adjustment ICN
• A partial payment or partial recoupment number is not referenced as the original ICN
• Filing the adjustment after the 18-month time limit
Note: If an adjustment is not filed until the 17th month from the date of service, the original claim may no longer be available in the system for adjustment. Submit adjustments as soon as possible so they can be processed within the 18-month time limit.
• Missing required documentation (Medicare vouchers, medical records, operative records, etc).
• Referencing the NPI on the adjustment request

Note: This form requests the MPN in the blank specified for Provider Number.

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Common Insurance denial reason

Some of the Common Insurance Denials

Claim denied for Missing / Additional information
Claim denied as Duplicate
Claim denied for Prior-Authorization / Referral:
Claim Denied as Inclusive
Claim denied as included in Global period
Claim denied as not medically necessary / Pended for medical notes
Claim denied as non covered service
Claim denied for eligibility
Claim denied for late filing
Claim denied as CPT - Dx mismatch
Claim denied / Pending for accident information: (Workmen's Compensation)

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Three key fundamentals to effective denial management

The three key fundamentals to effective denial management.

Prevention

Prevention focuses on actions that can be taken upstream in the patient encounter to prevent denials from occurring in the first place. Prevention can be introduced anywhere in the patient encounter such as: Pre-admit/Pre-registration, Scheduling, Admit/Registration and Billing. Our denial management experts ensure that we track such trends and keep the Client informed periodically about improvements/process changes that can be made across functions.

Analysis

The process of analyzing and aggregating similar denials is strategic in denial management. The Denial management team understands that analysis and segregation is a forerunner to follow-up process and hence for us it is an fundamental step in denial management.

Tracking and Trend Management

Besides keeping a track of the denial trend from payers our experts also actively monitor the payment patterns from various payers and set-up a mechanism to alert when a deviation from the normal trend is seen. This is important in understanding the causes of claim denials and enhancing long-term efficiency and drastically reducing lost revenue. 

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What is denial managment soloution

Denial Management Solution 

A good denial management process is not simply about working denials, it is about systematically gathering the data required to eliminate denials. Working denials is like pumping water from your basement when a pipe bursts. Denial management is about fixing the pipe so you no longer need to pump water from the basement.

We also understand that achieving powerful results from denial management requires data, data and more data. Our denial management process reports and measures all claims that are being denied by your payers. With this level of data our Denial Management specialists can fix the issues that are leading to the denials (whether it be issues with the claims or issues with the payers) and stop the torrent of unpaid claims into your medical billing process. Once we do this, then revenues for your practice will increase; probably by 10 to 20 percent.

Over the years we have learn that three elements are typically missing from a practice or medical Provider's denial management process: data, filtering/sorting methodologies and feedback to systematically correct errors. Most practices & practice management systems do not properly track denials - at least not in the form in which they are typically used (i.e., they may have the capability, but only if properly implemented and used). The practice management systems that do track denials typically overwhelm the practice with data that is difficult to utilize for high level denial management. Finally, even if the data is captured and can be properly utilized, most practices do not have a systematic way to get the information back into the billing process in a manner that prevents the denials from occurring again in the future.

Our Denial management Process tracks every claim that has denied and can report this by payer, by CPT, by physician and by diagnosis. This information is presented in a manner that allows fast identification of trends. With this powerful combination in hand, the Practice / Provider of medical service can then utilizes claim rules and edits that are specific enough to dramatically drive up the first pass claim acceptance and stop the flood of denied claims. Our in depth analysis described above also allows payers that are habitual violators of Clean Claim Rules to be identified and pursued. The data and analysis will allow many opportunities for process improvements and revenue enhancement for the practice.

If you implement our powerful Denial Management Solution you can optimize your medical billing and speed up your cash flow. As previously mentioned, our strong denial management solution can increase your collections by 20 percent or more.

As Denial management is a subsection to Accounts Receivables of any medical facility, we religiously follow the below methodology of managing denials from payers. Our solution is focused around the three key fundamentals to effective denial management.

• Prevention

• Analysis

• Tracking and Trend Management

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Claim denied as - inclusive, maximum per unit, injury liablity and pre existing

Claim denials for maximum unites per visit 

Check your units of the CPT

Claim denied as inclusive with the primary procedure 
Some service covered with primary procedure, Hence we needs to taken write off the claim balance after primary CPT paid. However there is chance with resubmit the inclusive procedure with modifier.


Claim denied as services not provided or authorized by designated 
File the claim along with appropriate authorization#. If we don’t have authorization# sometimes we can appeal the claim along with necessary medical document.

Claim denied because of incorrect medical coding 
Should be file the claim with correct diagnosis (Dx) and CPT

Claim denied because this injury is the liability of the no-fault carrier. 
Should be file the claim to patient auto-insurance.

Claim denied by medicaid because primary insurance changed 
File the claim to patient primary insurance. If we don’t have patient primary insurance details needs to call the patient and get the insurance information.

Claim denied by medicare for code co-16 what do i do to get this paid? 
      We will receive this denial if we have filed the claim with insufficient information. This code co-16 must have additional denials information that informs us what kind of information is missing with claim.


Claim denied due to pre-existing condition 
Patient needs to update the medical (medical history) document to insurance and provider also update the medical document to insurance.

Claim denied for clia certification# 
Should be file the claim with clia certification number. We must file the lab code with clia number.

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Type of denial - difference between rejection and denial

Claim denial types

There is no particular type in denial however below are the common reason
Claim might be denied for incorrect coding information.
Claim might be denied for incorrect provider information.
Claim might be denied for incorrect coverage information
Claim might be denied for lack of information



Claim denials by managed care organization plague long-term care providers 
Should be file the claim to patient HMO plan

Claim denied for coordination of benefits 
Patient needs to update the COB information to insurance. If patient has more than one insurance, patient need to call the insurance and inform that which insurance is primary and secondary for patient. Patient only can update the COB information to insurance.

Claim denied for maximum benefits reached 
File the claim to secondary along with denied EOB. If patient do not have another insurance we can bill the patient.

Claim denied for valid referral 
Should be file the claim with valid referral. If we do not have valid referral number, we can request the same from referring doctor and refile the claim with valid referral.

 Claim denied no billing code.
Kindly call the insurance and get the reason behind the denials and get the correct CPT

Denied benefits is not covered by the patient's plan.
 We can bill the patient.


Denied insurance claims due to invalid cpt code 
     Should be file the claim with valid CPT. For example medicare and HMO plans (Humana, freedom health, AVMED, universal, wellcare, Polk county, PUP,) does not cover the consultation code (99241 to 99245 and 99251 to 99255).

Claim denied reason dates of service over one year from process date are not payable. 
    Should be file the claim with in timely filing limit. If you received the denial even filed the claim with in TFL we can appeal the claim with TFL proof. All insurances has separate filing limit.

 Claim denial codes and what action needs to be taken 
Each denied claim should have valid reason behind the claim denial and needs to take appropriate action from the denials

 Claim denial vs claim rejection 
Claim denied by insurance and claim rejected by clearing house OR EDI department

Claim denials bundling inclusive 
Needs to differentiate the service by using appropriate modifier and Dx else taken write-off the claim balance

Claim denied primary paid in full 
Need to write-off the claim balance.

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Denial managment process

Denial Management

Denial Management is a new process methodology whereby patterns and consistencies within denied transactions are analyzed and resolved in a batch process regardless of the account. For example, United Healthcare is denying all supply charges for knee arthroscopies as bundled for our Dr. Smith at his primary location. A denial management methodology will provide all open balances (balances not equal to zero) of accounts receivable that meet these conditions. The billing staff will analyze and resolve these conditions in one action based on a denial reason rather than account by account within a certain queue.

Strengths

• Provides a reporting vehicle to reduce incoming denials within the provider RCM process

• Allows capture of the consistency in transaction denials by provider, payer, procedure, date

and reason

• Improves claim throughput per FTE by three to four times

• Segments claims production issues from A/R issues

• Bypasses embedded, queue-based rules in practice management systems to eliminate

duplication and provide the ability to pull all receivables with all balances for analysis

• Allows view of credit balances within a provider or practice

• Allows for development and implementation of denial adjudication rules to manage

certain conditions

• Easier process to train new staff

• Derives A/R independently from embedded practice management applications

Weaknesses

• Requires integrated payment posting and imaging and indexing of correspondence to fully

optimize the process


Denial Management

Denial Management isolates and eliminates the traditional excuses in accounts receivable for healthcare by forcing action to resolve accounts versus just working accounts. Clear, definable accountability from the denial management process is a critical benefit in addition to the other benefits.

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Account receivable managment - what is task management

Task Management

Task Management is embedded within the majority of commercial practice management or receivable management systems. This methodology lifts or queues accounts within the existing accounts receivable based upon some user defined rules in order to serve up an account to be worked. For example, all surgeries for a particular physician—let’s say “Dr. Smith”—greater than 60 days old would be a task queue or segmentation of accounts to be worked. This technology is a great improvement over working a simple accounts receivable aging from highest to lowest dollar, whereby the bottom half of the list never gets touched due to the size and scope of the entire list.

Strengths

• Achieves a segmentation of the A/R to allocate among the billing staff

• Provides the billing manager with some basis of evaluating employee productivity,

efficiency, effectiveness

• Provides responsibility for a particular work queue

• Allows flexibility to create multiple queues

Weaknesses

• Tendency to have too many, duplicate queues and duplicative work

• Embedded within the system are work queues that must be updated to insure queue logic

does not omit/drop new information

• Does not segment claims production issues from receivables

• Little or no capture of denial consistency by payer, provider or procedure

• Does not provide a means to develop and implement denial action rules

• Can promote “just working an account” for work’s sake versus resolving an account; in other

words, an analyst might be more focused on touching that charge and adding notes than
collecting money, progressing its status, by identifying reasons for denials and fixing them

• Does not facilitate denial reporting to improve the entire billing process

• Little improvement in billing efficiency per full-time equivalent employee (FTE)

• A/R is dependant upon embedded PMS systems

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Task Management versus Denial Management

Accounts Receivable Management: Task Management versus Denial Management

The process of medical accounts receivable (A/R) management is truly a misnomer. In a perfect world, accounts receivable would require nothing more than collection—not management or process. However with growing complexity, payment ambiguity, payer plans, co-pays, co-insurance and other factors that drive up costs in healthcare delivery, the management of the accounts receivable process continues to demand more attention. With an average of 30 percent in denial rates and informed speculation of 15 percent in lost revenues on an annual basis, we must conclude that the management processes currently in place are woefully inadequate and costly. Unfortunately, the national healthcare debate on improvement does not address the A/R  management process (or lack thereof) where significant cost savings could achieved.

Symptoms of an Infirm Process

According to most industry publications, the majority of medical providers collect a portion of their charges within 60 to 70 days from the date of service as compared to five to 10 days required of most retail service providers. Why the difference?

• On average, medical providers have over 60 various contracts with payers for services

rendered that do not typically include the reimbursement amounts.

• Each patient has a unique status within annual healthcare insurance plans as it relates to

eligibility, allowables, network status, coinsurance, and covered services—factors not available to medical providers in advance of the visit with any consistency or clarity from the various payers.

• The allowables and eligibility are reset and, in many cases, change annually. This eliminates

any consistency from payer, procedure and patient over the years.

• A 30 percent denial or reject rate for services rendered would incur significant financial

hardship on the provider.

• The cost of collection approximates 20 percent of the benefit. To justify this cost, each

claim requires an average cycle process of two to four times from provider to payer to resolve the balance owed. If the cycle cost were $5.00 each, the average cost would be from $10.00 - $20.00. With an estimate of $100.00 paid per cycle, the cost would be 10 percent to 20 percent. These figures are substantially higher than the cost of collection for other retail service providers.


The result of these simple factors creates the increasing demand for accounts receivable management systems to clear a path through this murky process. Today, there are two competing methods to manage the process. They are Task Management and Denial Management.

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Key Functions of Denial Management

• Maximize cash flow - Reporting identifies denial causes having the greatest financial impact, thereby accelerating cash flow.

• Identify the root cause of denials - Collecting and interpreting denial patterns to quantify denial causes and their financial impact.

• Support accurate workflow priorities and scheduling for follow up - Collecting information on denial appeals, including status, escalation, correspondence with payers, and the disposition of denial appeals to increase recovery amounts.

• Provide accurate and timely statistics for Management / Clients - Providing management analysis reports and other information to prevent future denials.

• Track, Prioritize & Appeal denials - Generating appeal letters based on federal and state statutes and case citations favoring the medical provider's appeal.

• Avoid out-of-timely filing.

• Analyze the effectiveness of denial resolutions.

• Identify business process improvements to avoid future denials

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