Medical Billing Tip of the Month – September

Kareo September 10th, 2012

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Our judges (you) have spoken, and we have our Medical Billing Tip of the Month. We received a terrific volume of votes! Thank you to everyone who voted on our blog and Facebook. The winner of our Medical Billing Tip of the Month contest this month is…

Control the Top 10 Internal & External Denials Using the Denial Summary Report

We are using the Denial summary report to control the internal and external denials in our providers’ practices

Go to Reports > Payments > Denial Summary > Change the date to “Year to date.”

By generating the report, you can view the claims denied with the denial code and the total amount. Just generate the report into an Excel spreadsheet and sort the denials in descending order by total amount. You can also drill down to the billed amount to review the CPT and the carrier for a particular denial code. Then categorize whether the denial is internal or external. Here is the report for reference:

Our September Medical Billing Tip of the Month features advice on how to manage your denials

For example: Co-22 – Payment adjusted because this care may be covered by another payer per coordination of benefits.

Ex: C0-26 – Expenses incurred prior to coverage.

Ex: Co-27 – Expenses incurred after coverage terminated

Internal Denial: The above denial is related to eligibility and we need to categorize only the eligibility denial based on the Kareo plan. If we have the Kareo “Complete” plan, we should have checked the eligibility before submitting the claims. Then it falls in the Internal Denial category.

External Denial: If you don’t have the option to check eligibility within Kareo, then the denial falls in the External Denial category. We can stop these denials by changing to the Kareo “Complete” plan or by checking the providers’ websites and/or educating the front office to check eligibility.

Denials other than eligibility should be checked and sorted into Internal & External categories.

Using this denial summary, we need to categorize the denials as Internal & External denial by the top 20 denial codes. Based on the type of denial, we need to educate our team to reduce these denials. If most of the denials are related to Internal error, we need to provide guidance and education to the team to reduce such errors in the coming months.

For External denials, we need to co-ordinate with the coding team and provider office to stop the denials such as “denied as non-covered service,” “rendering provider is not eligible,” “Pt enrolled in Hospice.” etc. We need to educate the providers to document the medical records more specifically for the service rendered to avoid such denials.

Steps to be followed to reduce denial %:

  • Generate the Denial summary from year to date and convert into spreadsheet
  • Sort the denial by descending order by total billed amount
  • Categorize the External and Internal denials from the Top 20 denials
  • Identify the Root cause of the Denial
  • Create a good solution to reduce those denials one by one with the help of coding expert
  • Educate the team and provider office with the perfect solution for these denials
  • Next, you will see the denial percentage reducing drastically in the coming months

Denial Category Metric:

If a practice gets less than 5% of denials in the total monthly billed amount, then the practice is in the “Best” category. More than 5% denials should be monitored and need probe review to bring down the denials. The clean claim percentage can be increased by using the report effectively

Best Practice – Less than 5%

Average – Between 5 and 10%

Alarm Bells – Greater than 10%

Conclusion: Managing your denials = Improving your revenue cycle.

Henry Richards
EccoHealth LLC

This is the second month in a row that Henry has won—congratulations! But we’re throwing out the challenge to our many other fine billers, billing services and billing managers: Send your tips in, and you could win the $250 prize!

Please be sure to submit your Medical Billing Tip of the Month to by Wednesday, September 26, for inclusion in the next round of judging. We’ll post the top three tips on our Facebook page and on the Kareo blog for your vote! You will win a $250 American Express gift card if your tip is chosen. Good luck!

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