5 Common Reasons for Medical Claim Denials
5 Common Reasons for Medical Claim Denials
“When a patient’s insurance claim is denied, not only can your cash flow be affected, the relationship with your patient can be damaged as well. Some claim denials can be successfully appealed, but even when appeals succeed, they can temporarily leave claim status up in the air – something both your practice and your patient would like to avoid.
Understanding common reasons for claim denials is key to preventing them. The insurers your practice works with may offer software tools to help you prevent claim rejections (which are claims that aren’t processed due to clerical errors) and claim denials (where claims are considered, but payment is denied) so it’s important that you are aware of these tools and utilize them. Here are the top 5 reasons why claims are denied, and how you can avoid these situations.
1. Pre-Certification or Authorization Was Required, but Not Obtained
Neglecting to get pre-certification (or pre-authorization, or whatever term the particular insurer uses) can cost your practice and your patients money and can seriously decrease patient satisfaction. Knowing which insurers require pre-authorization and for what is essential.
In some cases your medical billing software can assist by flagging certain procedures and insurers so you’ll know what to do. Additionally, it’s better to get pre-authorization for a procedure that isn’t ultimately done, rather than to do a procedure and try to get retroactive authorization for it.
2. Claim Form Errors: Patient Data or Diagnosis / Procedure Codes
Claim rejections (which don’t usually involve denial of payment) are often due to simple clerical errors, such as a patient’s name being misspelled, or digits in an ID number being transposed. These are quick fixes, but they do prolong the revenue cycle, so you want to avoid them at all costs. Incorrect diagnosis and / or procedure codes can result in claim denials. While these situations can often be successfully appealed, again prevention is better. There’s no substitute for well-trained coders and use of powerful medical billing software…”
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