Reasons for Rejection

Many medical billing and coding professionals have had the unfortunate experience of having their submissions denied. Contrary to being ashamed, professionals can use these as opportunities to learn from their mistakes, and most employers will forgive the inevitable return provided they do not become repeat offenses. The following are some of the most common reasons for returned claims.

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As most will probably guess, the number one reason claims are rejected is because of incomplete or wrong information provided about a patient. This can include a misspelled name, not using a patient’s full name, or inaccurate and misplaced numbers. With so much loose information to keep track of and transfer from one form to another, it is no wonder mistakes in this category outrank all others. As basic as the advice may seem, billing and coding professionals always need to double check their work.

The next most common reason for rejection is due to issues arising from the insuring agency. These often include terminated coverage and procedures that were not covered or needed prior authorization. The best defense against these is for the medical provider to check and ensure a policy is current before service is provided. Also reading the fine print of what is and is not covered, and what procedures need pre-approval can prevent rejections on this basis.

Another common reason for denials is because a third insurance company is involved. These occur when the patient has a specific type of coverage, like auto or malpractice insurance. Many times a carrier will not issue a payment until the other insurance details are worked out.

And finally, there are always some billing and coding professionals who cannot manage to turn their claims in on time.

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When a claim is denied, the medical billing and coding professional together with the health care provider will need to figure out why. This begins by identifying the specific reason for denial and working with advocates on the medical staff to start to build a case for appeal. And there is no need to panic quite yet, as around fifty percent of denied claims can be successfully appealed. Some insurance companies even set their claims software to flag a prescribed rate of rejections – much like the apocryphal story of the cop writing speeding tickets to fulfill a quota – and these can still be successfully collected.

Once the reason for denial has been identified and addressed the claim can be resubmitted. Depending on the initial reason for denial, the appeal may have a very good chance of being resolved, especially if the basis was for technical reasons. However even if the rejection was on more arguable grounds such a lack of medical necessity, statistically the more times a claim is resubmitted the more chances it has to be accepted.

As always in the medical billing and coding industry, it is extremely important to keep a record of everything. Especially when challenging rejected claims, maintaining well organized records can mean the difference between approval or denial.