Secure Billing Solutions is a complicated process involving many parties and set stages that need to be followed to ensure payments are made timely and accurately. Good medical billing can make or break a hospital, lab, or practice. In this blog we explore the appeals process, and how to set up a sound medical billing system that ensures your appeals are followed up quickly and accurately, to build a solid revenue system.

Medical Billing Appeals Process

The main job of medical billing specialists is to understand each patient’s payment responsibility, evaluate their insurance coverage, prepare accurate billing forms, and finally collect the exact payment from the insurance plans or the patients themselves. This process starts when a patient schedules an appointment to see the doctor and ends when reimbursement is collected from the patient’s insurance company or the patients themselves.

Why Many Claims Are Denied

The medical billing appeals process is the process used by a healthcare provider if the payer (insurance company)or the patient disagrees with any item or service provided and withholds reimbursement payment. Some of the reasons for claim denial include:

• The patient is not enrolled in the plan or with the payer
• The specific medical procedure or treatment is not covered
• Pre-certification is not on file: Insurance companies may require the ambulatory surgical center (ASC) to receive approval from the carrier before providing medical services. In the absence of pre-certification, the claim may either be denied or payment may be reduced.
• Inadequate documentation to support the reason for performing the medical procedure
• The absence of a valid referral number on file
• Errors in demographic data on the claim: for example, an incorrect procedure code which is age appropriate would invalidate the claim
• Failure to submit adequate supporting documents for claim adjudication

Healthcare provider offices must spend their time and resources to appeal denied claims. This helps the providers to recoup money as well as prevents auditors from investigating difficult, problematic claims. Failure to identify and appeal denied claims may indicate to the auditors that the providers are unaware of potential compliance problems or incorrect billing and that they are not proactive about rectifying the errors.

Essential Steps in Appealing Denied Claims

How can healthcare providers improve their appeals process in medical billing and enhance the likelihood of being reimbursed? Here are some of the things that health care providers can do when appealing denied claims:

• Call the insurance company: often claims are denied with generic denial codes that do not explain the reason accurately for not reimbursing. A phone call can help clarify the reason for denial of the claim.
• When calling the insurance company, record the date, name of the insurance company representative, and a reference number for the phone conversation. The reference number will expedite the process, especially when multiple calls to the insurance carrier are required.
• Use the claim number on a corrected claim. Otherwise, the claim will error out as a duplicate claim
• Plan a strategy for what needs to be appealed: it Is difficult for practices to appeal to every claim that is denied. So, healthcare providers should devise a strategy – for example, focus on high dollar claim denials only. Some practices are not aggressive about appealing Medicare and Medicaid denials as the appeal processes for these payers are more onerous than others.
• Categorize denials: Categorizing denials helps to identify patterns and streamline the appeals process for medical billing. Billing teams can develop strategies and document the way in which they will appeal to each type of denial, especially payer specific requirements.
• Appeals letter: Standard appeal letters are available on many payer websites for denials related to invalid code, incorrect subscriber name, or incorrect modifier. When filing standard appeals, important details like type of service provided and date of service should be clearly mentioned for payers to process the claim. For other types of denials, such as those related to medical necessity, a customized appeal letter may be needed. Mentioning CPT/CMS guidelines or even the payer’s guidelines in the appeal letter may help in processing the claim faster. If the appeals letter fails to provide all the required information, then the appeal process may be prolonged, and this creates more work for the billing team.
• Relevant documentation: The appeal for medical billing should include only the specific documentation related to the claims process. If too much documentation is included, then it may lead to HIPPA violations and may also require too much time for compilation.
• Recruit a professional reviewer or physician with experience in billing, coding, HIM or utilization review. Such a person can supervise and manage the appeals process and contact payers directly.
• Create a contact list: Every healthcare provider’s billing team should have a formal list of contact information for the different payers, the individual responsible at the payer’s for answering questions related to claim denials. The ideal person for this is the denials manager or denials coordinator and not a person from accounts receivable.
• Create a spreadsheet with information about each appeal: date each appeal is submitted, payer to whom each appeal is sent, filing requirements of each payer
• Follow up on each claim once a month and set reminders to follow up. This will prevent any claim from falling through the cracks.
• Finally, map the steps of the appeal:
• Step 1: Call payer for clarification for denial of a claim
• Step 2: Request a fair and complete review of a claim. If necessary, call the Department of Insurance or the Office of the Ombudsman
• Step 3: Consider legal action to recoup a claim

Resubmission of a Claim

Resubmission of a claim means that the claim was originally denied due to missing documentation or incorrect coding and is now being resubmitted with the required information. When filing resubmissions, the billing team should include the following information:

• An updated copy of the claim along with a copy of the original claim
• A copy of the remittance advice on which the claim was denied or incorrectly paid
• Any documentation required by the insurance payer
• Identify each claim clearly with the words “resubmission.”