Medical Denials Management for a New Age

Editor’s Note: This article is the second in a two-part series by Shanna Rogers. The first installment was published yesterday on insidePatientFinance.com. Click here to read it.

Get ready: Claims processing and denials management are in the midst of a substantial transformation. Will you be ready?

Most healthcare providers have organized claims processing and denials management based on payor. There’s a Blue Cross person, an Aetna person, probably several Medicare experts — but in the future this may not be necessary, because all payors will be using the same codes, the same claims submittal processes, the same denials workflow.

But at the same time that the claims and denials processes are becoming more alike, there are already emerging subtle variations on how an individual payor manages its own house. By standardizing these processes the payors will be able to use much more sophisticated tools to sniff out fraud and claims errors. As a result, providers can expect even more denials (and the corresponding recoupment of payments); much as providers have come to grudgingly accept RAC audits.

It will be up to healthcare providers to become as sophisticated as their counterparts in the insurance industry. Here are three trends we see, the Ghosts of Denials Management past, present, and future:

• Creating a revenue integrity department, the key to analyzing denials and implementing organizational processes to mitigate front end denials. If a provider does not yet have a revenue integrity department or at least a defined revenue integrity function, they are already behind their peers. The revenue integrity function—those business processes related to ensuring compliance and optimal reimbursement from payors—have always been important for management of the revenue cycle, but thanks in no small part to increased business intelligence capabilities and other data management capabilities, revenue integrity has become the difference between profitability and loss.
• Switching from a siloed view of payors to lateral view. Instead of operating from a payor-centric role, providers must begin to focus more on denial codes and related functions. While on one hand this will make the denials process workflow more streamlined, it will at the same time require a more sophisticated approach to avoid those more costly denials that will result from multiple payors simultaneously.
• Enabling a dispositional approach to account management. This will be the future of denials management. Current platforms managing patient accounts do not allow for a disposition status once that account has left the provider and is in the hands of a third party. The future will be in complete transparency to the provider of individual accounts, regardless of where they reside.

Before this trend becomes established practice, providers need to take a hard look at their business office and identify what changes and commensurate investment will be required to meet these upcoming challenges. Many will seek out partners who can match the payors muscle for muscle with sophisticated data analytics that enable root causal analysis of denials.

In case you missed part one in this series, click here to read HEALTHCARE REFORM MAKES PRIVATE INSURERS ACT LIKE MEDICARE, MEDICAID

About Shanna Rogers

Shanna Rogers is a supervisor with ProSource Billing, Inc., a part of the Array Services Group family of companies. Shanna  has 13 years of Revenue Cycle experience working with many types of organizations. She has been with ProSource Billing  for the last 10 years contributing to and managing projects.