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The Underlying Disease of a Medical Practice
September 23, 2022
Radiation Oncology Audit Insights
September 29, 2022
Published by Jennifer McNamara

What are Unnecessary Claim Errors costing you?

In today’s business of healthcare landscape making mistakes can cost a Medical Practice or facility thousands annually. Do you know the true cost of the errors made in claim submission at your facility or clinic?

Understanding the errors is part of the equation but the most beneficial thing we can do is learn to prevent these errors in the first place. We must develop a proactive approach to our data and use it to our benefit.

 

Root Cause Analysis

In the Business of Healthcare mistakes are common in how we abstract data from medical reports, our interpretation of insurance policies and many times due to miscommunication by those we work with.

It’s a constant learning process but there are things we can do proactively to learn from those mistakes and not repeat them.

First, perform a Root Cause Analysis of the error and the data reflecting what led up to the error.

Second, come up with an action plan that lays out what you plan to do in order to prevent this error in the future.

Third, follow up with your team to help you analyze your progress and the effectiveness of your action plan

 

Identify Common Claim Errors

When we get ready to send a claim, we may think we have captured all the data needed to justify payment for a Service, but the rejection or denial of a claim tells a different story.

The denial or rejection may be due to our human error or the error at the payer level that needs investigation. One of the biggest mistakes made is not taking the time to investigate the error which could inevitably prevent you from learning from your mistakes or the mistake made by the insurance. We need to analyze all data regularly to identify where education and gaps in effective processes lie.

  • Incorrect Patient Demographics obtained and entered
  • Misinterpreting patient benefits and coverage
  • Ineffective communication with clinical and clerical staff
  • Incorrect data Abstraction of Procedure, Diagnostic Codes and Modifiers
  • Failing to review Out of date Contracts
  • Incorrect payment posting
  • Failure to send correspondence to the insurance company in a timely manner
  • Failure to file a claim according to the insurance payer timeline

You may have heard that 90% of claim Denials are preventable. As you can see with the above common denials, these are all preventable Denials.

 

Coding Accuracy over Speed

There is a misconception by many that the process of Data Abstraction or what we call Coding, can be done quickly and also accurately.

While many Abstraction experts exist and these individuals can process a high amount of data, there are certain types of services that require time and research to ensure accurate Abstraction to ensure accurate payment.

What happens if you rush a data Abstraction expert or coder to push out more data than it’s possible to do and maintain accuracy?

You may receive payment initially but in time during a post payment audit, the insurance company may discover they overpaid the claim due to a data Abstraction error and they will require you pay back the money.

After considering the consequences of quantity over quality you may decide to implement process changes and expectations of your staff.

Is there a better way?

There are many opportunities to improve accuracy and eliminate waste, not only of resources but also time. Many are finding that technology solutions like Code Interceptor and utilizing Subject matter experts is the key to preventing waste and ensuring accuracy of payment.

 

Steps to Prevent Errors

Let’s review the steps that successful Data Abstraction experts utilize in maintaining a healthy revenue stream

  1. Use Current Data Code Sets. Successful Data Abstraction experts know the importance of using current code sets and guidelines. Both quarterly and annually new codes and guidelines are created and implemented for use in reporting medical data. It is vital that we not only use the current data set but that we understand how to interpret the guidelines put in place by the organizations that govern these code sets. The AMA® (American Medical Association) maintains the codes and guidelines for CPT (c) Current Procedural Terminology that details all the current data sets used to describe a procedure or service performed. The Centers for Medicare and Medicaid Services CMS® maintains the Healthcare Common Procedural Coding System HCPCS (c). To report Medical Necessity for these services there are four organizations who come together and implement the guidelines to follow when reporting ICD10-CM (International Classification of Diseases-Clinical Modification) code set that is created by the WHO® (World Health Organization) They are the American Hospital Association (AHA), the American Health Information Management Association (AHIMA), CMS, and NCHS(National Center for Health Statistics-CDC).

 

  1. Verify Patient Coverage and Eligibility. When a patient presents for services, many times they will not be paying cash. They will submit their insurance coverage and this requires we validate and verify coverage does in fact exist, is currently active and verify if the Insurance carrier has criteria to be met before a service is paid for. Part of this verification process will be to determine if the criteria is to obtain a Prior Authorization. There may also be clinical guidelines that will need to be documented and verified either before a service is performed or after the service is rendered, wherein they will request a copy of the Medical record to confirm coverage guidelines are met.

 

  1. Understanding the Insurance Claim Processing requirements. You may have followed the first two steps by ensuring the codes selected meet the guidelines set forth and that the documentation requirements are met. The first two steps are crucial. Next, our goal is of course to make sure our claim for payment is successfully received and processed. How a insurance carrier processes these claims should be well understood by the individual submitting the claims. Many errors are made at this level in part by ignoring one or both of the previous steps as well as not reviewing the insurance requirements for additional data needed to process the claim.

 

Many insurance carriers have processing requirements such as the Order of data code sets and properly linking them. Use of 2 digit Modifier combinations allow the proper and true intent of the claim data to be expressed. Claim payment is based on the service rendered and where it is rendered, which will require knowledge of Place of Service Codes such as Inpatient (21) On Campus-Outpatient Hospital (22) or Ambulatory Surgical Center (24). There may also be additional data such as NDC National Drug Codes to verify the drug purchased and used, reasons listed on the claim as to why we are requesting to obtain more reimbursement than usual based on Modifier usage and many other factors that influence a claim getting processed and paid.

 

  1. Interpreting Denial and Appeal Processes. It is inevitable that some claims will return rejected or denied. Not all denials are accurate as they may have been processed in error at the insurance company level. Remember, claim edits are only as good as the person creating them. Recent data shows that denial rates are around 8 to 10% which accounts for 20% of the expenses in the practice. According to a recent Survey, 69% of respondents said that denials have increased and according to the survey the average increase was 17%. Even though 80-90 % of denials are preventable, many of the denied claims are accurate and payable according to the insurance policy. So this now creates difficulties and significant cost to manage and receive accurate, timely payment for a Medical Practice or facility.

 

In fact, many insurance companies know that their denial systems are not accurate which is why they have provided appeal guidelines. Even when to the best of their knowledge, they have created accurate edits, every claim is different and carries a different, unique set of circumstances. We never want to assume a denial is accurate and just adjust off the charges and continue the cycle of waste. If you have done all you can to prevent unnecessary denials, and you have used the first three steps to understand the Insurance guidelines and coverage policies, it is now time to use that information to back up your claim and appeal that denial. We encourage our readers to investigate each individual claim denial and use the tools provided by the insurance carrier to obtain accurate and complete payment to ensure the health of your practice.

Do you struggle to find qualified individuals to follow the steps outlined above?

 

Contact us at http://www.oncospark.com for more information on how we can support your current staff in your time of need.

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Jennifer McNamara

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