Stay up-to-date on skilled nursing regulations along with tips and tricks to improve your medical billing from the experts at MCA.

Posted: May 13, 2020

How to Avoid the 5 Most Common Medical Billing Denials

Medical claim denials are a problem for your cash flow. You work hard at reviewing the claims, making sure they are correct and submitted on time. Then, a few days later, the remits come through and 10% of the claims are denying. Likewise, the cost of the re-works is approximately $2.30 per claim. 

If you are like us, you will spend a few hours reviewing these denials and realize how easily they can avoided. You may also realize how much time you could have saved by focusing on the front-end of billing.

Whether you have been in medical billing for 1-year or 30-years, you have run across at least one denial each month. Although denials are a part of the billing cycle, there are ways to prevent claims from denying.

Nevertheless, what are the most common denials? We would like to help you by providing the five most common denials as well as how you can prevent them.

Not only will this help improve cash flow but it will also help you save time in your follow-up process.

By being prepared, you can help your organization stay on top of your claims and avoid the common errors in the future.

The five most common denials throughout medical billing are:

1. Coding Errors
2. Duplicate Claims
3. Expired Timely Filing
4. Incorrect/Missing Information 
5. Non-Covered Charges

Coding Errors
One reason your claims may deny or are denying is that the codes are either missing or inaccurate. For example, Medicare Inpatient Part-B claims require both the onset code and the corresponding occurrence codes for your therapy disciplines. Without these codes, Medicare will deny your claims.

Prevention Tip – Before submitting the claims, review the occurrence codes section to ensure the required codes are present. We recommend having a copy of the therapy report to ensure you use the correct dates and codes. 

Duplicate Claims
A duplicate claim, by definition, is a claim that contains the exact same member identification number, provider number, date of service, type of bill, procedure codes and billed amount of another claim. How does a duplicate claim happen? This happens when you submit or resubmit a claim without the proper adjustment codes or by not reviewing previously submitted claims.

Prevention Tip – Before submitting the claim(s), make sure that an adjustment claim has the corresponding adjustment type of bill and/or references the previous claim. Likewise, you will want to review with the payer if there are any existing claims that will cause a duplicate claim error.

Expired Timely Filing
Perhaps the easiest to avoid but also the easiest to overlook. Most payers have strict guidelines for when you must submit a claim in order for them to process the claim for payment. For example, Medicare’s timely filing limit is one year from the dates of service. 

The process seems simple enough, submit the claims before the time limit and you are set. However, there are some claims which have issues preventing them being processed. Perhaps the member’s coverage was not active yet, you were busy working on another project, or there were larger claims that needed your attention. Whatever the case may be claims can slip through and ultimately become uncollectable due to timely filing.
Prevention Tip – Keep a record of the claims that you need to submit. Likewise, you need to update your report each week to ensure you have submitted all of the claims and that they are on track for processing. 

If you need a quick and easy way to document your notes call or email us to schedule a demo of our AR Note Tracking Software REVEX. This will help prevent your claims from denying for timely filing.

 Incorrect/Missing Information
Another reason claims deny is that the claim is missing or has incorrect information. For example, the claim is missing the patient’s identification number. Once the payer receives the claim, their system will audit the claim information and immediately trigger a denial.

Prevention Tip – Before submitting the claim, make sure you review each demographic field to ensure the resident’s Date of Birth, insurance number, payer ID and/or name is correct. 

Non-Covered Charges
One of the more complex denials is non-covered charges. Non-covered charges require research to ensure you will receive full reimbursement for the services rendered to the patient. This denial occurs when the patient’s plan does not cover the codes on the claim. Likewise, this denial occurs if the claim contains codes that do not match other items on the claim. 

Prevention Tip – If you are dealing with a Medicare Replacement, Medicare Advantage, etc. make sure you call the patient’s plan to confirm if the services are covered. Likewise, make sure as you get ready to bill you review the claim’s revenue codes, modifiers and/or the diagnosis codes.

SummaryPreventing claim denials does not have to be stressful. By focusing on the up front billing (quality checking the claims) and having excellent documentation you can prevent denials on your claims. 

Likewise, as you progress each month you will be able to identify the key fields which caused the denials; and thus, reducing the time it takes you in corrections.