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4 Common Reasons for Claim Rejections and How to Avoid Them

Updated: Aug 6, 2020

A major source of frustration and dwindling revenues for healthcare providers is claim denials. Not only do they affect your cash flows but also damage your relationship with patients. It is thus essential for practitioners to identify and eliminate the common causes of denials to ensure the optimal financial health of their practice.

Even though the causes of claim denials and the headaches that come along with them are many, having the support of a topnotch medical billing company like CS EYE can ensure that you submit clean claims every time, minimizing the risk of denials. Here are four of the common reasons why claims are denied, and how to avoid them.

Essential Prior Certification or Authorization Not Obtained

Before submitting a claim, there are various pre-authorizations that healthcare providers need to take care of. Ignoring the pre-certifications or not getting pre-authorized can cost your practice a lot and seriously hamper patient satisfaction.

Pre-authorizations are mainly required for high-cost ancillary services, surgical procedures, etc. From not getting the prior authorization number right to not getting all the services on the claims pre-authorized, there are a number of reasons why your claims may not meet the essential pre-requisites and thus, lead to increased denials.

Submitting Incomplete or Erroneous Claim Forms

One of the most common yet trivial causes of denials and rejections is the submission of claim forms with missing or incorrect information. Specific dates, wrong plan codes, missing modifiers, etc although being quick fixes, can considerably prolong your revenue cycle.

It is essential for healthcare providers to double-check all the claims before they are sent out or to outsource a reliable billing company, so as to avoid any errors and ensure greater profitability. Well-trained coders and powerful medical billing software can ensure the accuracy of your claim-forms and thus, bring your denials down to a minimum.

Filing Claims for Excluded and Medically Unnecessary Services

When it comes to medical insurance, the services covered will be different for different insurance companies. There will also be certain services that will be deemed medically unnecessary by the insurer and hence, won’t be paid for.

In such cases, your claims would be rejected and you would be forced to absorb the cost of the services or collect the payment from the patient. Thus, checking the list of covered diagnoses on the carrier’s website beforehand is imperative so as to make informed decisions while filing claims.

Submitting Claims Post Insurer’s Prescribed Deadline

Most insurance companies prefer claims to be submitted only in a specific window of time. Irrespective of how accurate & precise the claims are, the failure to meet deadlines can lead to denied or rejected claims.

Medical billing software can be optimised to notify healthcare providers of submission deadlines and provide the necessary steps to follow when a deadline is missed. Denied claims can further lead to more paperwork and also slow down your revenue cycle, hence it is best to submit claims immediately after the services are rendered.

Connect with us to resolve denials more efficiently and faster, and ensure the optimal flow of revenues for your healthcare practice. We specialize in medical billing and can customize a solution that fits the unique needs of your practice.

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