How to Handle Insurance Claim Denial

wp-1458675401194.jpgMillions if not thousands of money can be lost in providers’ offices if  claim denials are not handled correctly. One statistic shows that 47% of denied claims don’t ever get appealed.

Three types of denial that can not be appealed:

1. The denial is correct and there is nothing to appeal.

2. Past the time filing. The biller does not have the time to handle them. It is imperative that every claim denial must be touched and corrected in a timely manner. Each payer has its own timeframe deadline in processing claims. Example, Medicare has 365 days filing period, Wellmed  has 60 days, just to name a few. Payers will not reconsider any claim that are past the timely deadline for appeal or correction.

Develop a Denial Management System.

If time management in handling denials are put into place, then they can be handled in less time. Most time spent on denials is figuring out what to do about them, which brings us to reason number three.

3. The biller or collector doesn’t know what to do about it. Some
times they understand what the denial is for, but do not know and/or aren’t sure what steps to take to resolve it.

One common denial is “denied for no coverage or coverage terminated”. This seems very simple, but many billers do not know what to do. Actually there are two things you can do right away.

1. Check for Payer Errors-

Just because the payer denied your claim does not mean that it is a correct denial. All MAP (Medicare Advantage Plans) mirror Medicare’s guidelines pretty much. Just an example, Aetna Medicare denies your claim as “Not payable as procedure does not meet LCD Guidelines”even though  your DX code is a payable code. Usually, this is a wrong denial from MAP payers, you have to check cms.gov to verify whether it is indeed an LCD issue. Most of the time you have to call the payer and let them know that the DX code you billed for is indeed LCD-covered.  It can actually be quite frustrating but once you call the payer or submit a letter of appeal, hopefully they’ll reprocess and pay your claim.

Another denial is “wrong member ID or member cannot be found“. If you receive a denial from for this reason, double check the patient’s insurance ID, or  go to the payer’s provider portal website and do a search on the patient. In most cases you can pull up the correct ID number by doing a name and date-of-birth search and then you can resubmit the claim.

If the denial is not one of those issues, the next thing I do is look at the patient’s claim history. Has the payer been making payments and suddenly stopped?

As an example, the payer have paid a patient’s claims before and after the date of service they are denying. If this is the case, it is impkrtant that you call the insurance carrier and ask them why the denial. Often times in this case, they’ll find out that the denial was wrong and that they actually do make mistakes!

Call the Patient

This should be your last resort. If the denial appears correct, and we cannot find any additional information through the website or a call to the insurance, then you need to contact the patient to get his/her correct insurance information.

If attempts were made but you are not able to get a hold of the patient,  you can usually send out a patient statement with the charges, and a note stating: “Your insurance carrier states your coverage was terminated. Please contact our office with updated insurance information.”

At times, patients forget or choose to not notify the provider when their insurance change. A bill will prompt them to notify you. Usually they call us and give us the updated information over the phone and the claim can be resubmitted. In case the patient never calls you back to update his/her insurance, check and see if he/she has Medicaid. Do not bill the patient if he/she has Medicaid as secondary payer. However, if he/she does not have Medicaid, you can bill the patient.

Most denials are pretty much repetitive. Study them, familiarize and learn from every denial so that in time, you will get use to their denial reasons and in that way you won’t waste time trying to figure out what to do each time, and the denial will get handled promptly.

If you do this, denials will be handled promptly and it will cut down on losses.

In my next articles, I will be posting denial reason codes and their corresponding solutions and ways to get your medical claims paid quickly. Hope this helps you in some ways.

Do you have questions about claims denial?  Please leave your questions on the comment section below and I will give you an answer promptly.

 

By: SEC
Certified Medical Billing and Coding Specialist

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