When discussing denials, it’s crucial to recognize that it's a complex topic.

Denial rules differ across healthcare facilities, influenced by factors like contracts, payor mix, case mix, local coverage determinations, and staffing. Instead of getting bogged down in details, we’ll focus on best practices applicable to most settings.

Our analysis emphasizes practical, beneficial methods that most facilities can implement immediately, particularly in enhancing appeals processing performance. Studies show that 24 percent of denials are unrecoverable, making an effective appeals process essential for the remaining 76 percent.

Here's how:

1. Establish Clear Business Rules

Creating a clear set of business rules is the first step in developing a process to address denials. Consider these questions to ensure you're on the right track:

• Which claim adjustment reason codes should we consistently pursue or avoid?
• Are these rules tailored to specific payor types or individual payors?
• Is there a minimum dollar amount associated with a particular denial/payor/patient status that warrants pursuit?

Clarifying gray areas and establishing precise rules will help your team manage appeals more effectively.

2. Conduct Cost Analyses

Every week an account remains in receivables unresolved, your bottom line suffers. While some aging denials may be necessary for remit activity, once this process is complete, pursuing an appeal within one week should be the goal. Additionally, knowing when to discontinue a costly appeal can prevent financial strain.

Perform a cost analysis to understand the expenses associated with certain appeals, enabling informed decisions about which types are worth pursuing.

3. Monitor Performance and Train Staff

Even small back offices should engage in routine performance monitoring. Implementing oversight can benefit even a lean team by identifying strengths. For example, an evaluation might reveal which appeals coordinator excels with specific appeals, helping redistribute workloads for increased efficiency.

4. Benchmarking and Analysis

Regularly assessing staff performance and analyzing denials and appeals data should drive the ongoing maintenance of business rules.

Evaluating success rates and administrative burdens will reveal opportunities for rule adjustments to optimize your business model. Regular benchmarking against competitors will help establish a baseline and measure the effectiveness of your approach.

Ready to enhance your business services?

MEDTEAM can assist with enterprise-wide revenue cycle management, including denials. Reach us at inquiry@medteamsolutions.com or call 1.844.615.1803.

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