By: Ehson Afshar, Director of Revenue Cycle
Revenue cycle insurance collectors are responsible for bringing revenue to the hospital system by following up with payers on claims and responding to payer requests/remits. However, when a payer sends a complete or partial denial on a claim, the path to payment is considerably more complex. Additionally, payer denials have increased in recent years with more difficult and convoluted requirements.
That’s why it’s preferable to create a standalone team to manage denials as opposed to a team to manage standard follow-up with the payer. However, creating a denials team is different than a regular insurance collections team. Here are 7 tips for creating a standalone denials management team that will help you avoid some common pitfalls.
- Separate the team into two parts – Technical Denials and Clinical Denials. Technical denials are typically easier to appeal to as the root cause of these denials is process or administrative in nature. For example, a wrong subscriber ID on a claim or a missing authorization number for an outpatient claim would both be technical denials. Clinical denials are related to medical necessity, length of stay, coding, clinical documentation, or level of care (typically inpatient claims). These types of denials require longer and more intensive appeals to get the denial overturned.Additionally, volumes are vastly different for technical vs. clinical. Technical denials are more numerous and faster to resolve while clinical denials are fewer in volume but take much longer to work. As a result, you might have a larger technical team working on more accounts with a smaller clinical team working on the most complex cases.
- For the Clinical Denials Team, hire resources who are registered nurses or have experience in Case Management. These resources should also have or be trained in patient financial services and reading complex payer remits. Clinical knowledge is paramount when appealing clinical denials, and resources with these skill sets are much more effective at getting the denial overturned. Additionally, clinical denials will have the most revenue at stake, so the most experienced and effective members should be part of the clinical team.
- Implement a “Cradle to Grave” approach at the account level. When payers return remits for a patient visit, there could be multiple denials on the account. However, when segmenting workflow, avoid splitting up work on one visit into different teams. For example, if the remit has both a clinical and technical denial, push the account to the clinical team. They can typically resolve both denials. If the account is split, then there are multiple people working on the same account which can waste time. Also, correspondence from the payer can become muddled as to who is responsible if two resources are working on the same account.
- Build appeals templates. After the team is up and running, there may be certain appeal templates that are preferred by certain payers. It’s crucial that the team has standard appeal templates to use to save time and adhere to payer requirements. These should be stored in a central location so that all team members can access the templates.
- Consider an out-of-the-box prioritization of working accounts. The typical prioritization for insurance collections is to work high dollar down, split by the payer and/or patient alpha. However, when it comes to denials, there could be denials with a higher chance of being overturned. Conversely, there are others with a very low chance of being overturned. When enough knowledge is gained about which payers and types of denials have a high chance of being ultimately paid, those should be prioritized. Denial groups that are consistently denied should be taken to the payer-provider representative to garner feedback on why the appeals are unsuccessful so that the approach can be altered.
- Loop feedback on denial root causes to the area that caused the denial to prevent the denial on a go-forward basis. When working cases, the denials team will typically uncover the most upstream reason, or “root cause,” of the denial. For example, if an authorization is needed for certain visits for a specific payer, but is currently not being obtained, feedback should be given to the front-end financial clearance team. Additionally, a billing edit could be built into the billing system to stop these types of accounts from going out without authorization.
- Ensure the work driver can report on appeal performance. Reporting on appeals performance is crucial to understanding the effectiveness of the appeals sent out by the denials team. It can also assist with worklist prioritization as outlined in tip #6. However, reporting on appeals performance can be tricky. There needs to be flags or indicators that denote if an appeal was done when it was done and if subsequent appeals were made. Additionally, we need to know if a payment was ultimately made by the payer and if the reason was due to the appeal itself (and all these fields need to be reportable!). There might be some data manipulation needed to get such a report up and running, but the benefits are well worth it.
Getting a standalone team up and running can be time-intensive and complicated as the right resources and technology need to be in place. However, by segmenting these more complicated accounts to a specialized team, the organization will ultimately realize more revenue – and these benefits will only increase as time goes on!