How to Improve Your Claims Denial Rate

Practice managers and medical billing specialists are knowledgeable, trained professionals who submit and process medical claims on behalf of healthcare providers and their patients to insurance companies. These invaluable team members must stay current on medical billing codes, be aware of patients’ plans and benefits, and manage the practice’s revenue cycle.

Even in the hands of an educated and capable medical billing specialist, insurance claims can still be denied. Denied claims are inevitable, but too many of them can pose a big problem for your practice and your patients.

Your medical claims denial rate is a key metric for evaluating your practice’s performance and financial health. As such, clinicians and their staff should pay special attention to trends, changes, and problems in their billing and revenue cycle management processes. By calculating, tracking, and working to improve your practice’s denial rate, you can increase cash flow and protect your reputation and your patients’ peace of mind.

Why Are Claims Denied?

The same few clerical issues cause a majority of denied claims. Claims can be denied due to human error — such as coding mistakes or late filing — or because the services rendered simply are not covered by the patient’s plan. According to the Centers for Medicare & Medicaid Services, the most common reasons for claim rejections in 2021 were:

  • Coding mistakes
  • Incorrect or missing patient information
  • Lack of prior authorization or referral
  • Lack of medical necessity
  • Services not covered

When an insurance payer denies a claim, they will provide insights on why they did not accept your claim. This makes appealing a claim denial easier and provides opportunities for you and your team to streamline workflows and prevent future denials. The process of monitoring and improving your claims denial rate is known as claims denial management.

How To Improve Your Claims Denial Rate

Not every practice needs to improve their claims denial rate, but if you’re concerned about frequent denials or simply want to improve your claim submission process, there are steps you can take.

Step number one to improving your claims denial rate is assessing your baseline. Effective denial management requires a great deal of data: you can only correct a problem you’ve identified. Once you’ve calculated your denial rate, you can start auditing your processes to pinpoint areas for improvement. It’s not an easy process, but our team of RCM experts has pulled together all our tips and tricks to walk you through how you can improve your claims denial rate.

Want to learn more about claims denial rates, industry averages, and resources available to help you file clean claims? Download our in-depth claims denial management guide here:

Benchmark Solutions: Your Revenue Cycle Management Experts

We understand the new and old obstacles that healthcare organizations, providers, and patients face daily. That’s why we made it our mission to create tools that make providing exceptional patient care as easy as possible.

Benchmark Solutions’ in-house revenue cycle management experts can reduce errors in your claims before they’re filed to give your practice a 98% clean claims rate. We can reduce your AR to an average of under 30 days by streamlining account and denial management, data entry, and medical coding so medical practices get paid faster and improve overall profitability.

Our medical practice management solutions navigate the complex, changing world of healthcare in the 21st century for you. We’re committed to providing intuitive, accessible, patient-first healthcare solutions — including electronic health records, revenue cycle management, remote patient monitoring, practice management software, and more — so you can focus your time and energy on the people who depend on you.

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