Thirty Percent Of Denials Result From Healthcare Registration Mistakes

By Infinx
November 21, 2017

How do healthcare systems empower denial prevention and management?

Preventing payor denials before they occur can save your practice precious dollars and improve cash flow. That may seem an obvious statement, but it might surprise you to learn how much physician practice revenue is lost to registration mistakes including inaccurate claims and denials that are never appealed. Some of the most common reasons for these claim denials include:

  • 30 – 40%: Registration errors including triage and intake notes not signed correctly, incorrect date of birth or insurance ID number
  • 15%: Service not covered
  • 7%: Missing or invalid claim data
  • 8%: Lack of prior authorization
  • 1%: Untimely filing

Claims success begins when your patient walks in the door

Most of the problems that cause denials can be addressed by a revenue cycle management (RCM) system that automatically conducts insurance verification and prior authorization at the time your patient schedules an appointment and/or at your patient’s initial visit. When you look at your RCM system do you see one that is built for accuracy and maximum revenue from the moment your patient schedules an appointment? The fact is that capturing your patient’s information accurately from the initial point of contact builds the roadmap that revenue will follow. On the other hand, inaccurate or missing data will lead your revenue stream into a swamp of costly denials.

When your patient schedules an appointment, your reception staff should immediately capture insurance information. From there, an automated verification and prior authorization process should begin. The right patient access platform will incorporate medical insurance verification solutions that confirm patient coverage details in seconds. Not only are you verifying insurance coverage, you are preventing your practice from incurring losses due to denied claims when coverage lapses or a service isn’t covered.

Prior authorization for treatments is just as important, especially during emerging or stat needs. You don’t want to delay care, or risk losing a reimbursement because your RCM system can’t process prior authorizations rapidly. Best practices in RCM now deliver prior authorizations in 2 hours for emerging need, and 20 minutes for STAT scheduling and treatment. This saves you and your team time and money.

Managing prior authorizations will save you money. One industry analysis showed that prior authorizations can cost providers as much as $35 to $105 per prior authorization. An RCM system that incorporates new prior authorization requirements is essential to protect revenue. For example, many third-party payors across the country now require prior authorization for genetic and molecular testing. The onus for this prior authorization lies with physicians; without it reimbursement is lost.

Embed prevention of denials in practice workflow

Only when denial prevention strategies are embedded in office workflow can your practice eliminate practices that lead to denials. For example, does your RCM system capture medical necessity information that is essential to accurate coding? Are evidence-based notes from the provider captured and correctly noted? Without this information, claims may be denied and valuable time will be spent interviewing physicians after the fact in order to appeal the denial. All this can be costly for your practice, since you’re forced to focus on administrative tasks instead seeing additional patients and providing quality care.

A recent report showed the five most common denials experienced by patients:

  1. Formulary exclusion (payors list specific treatments they will not cover): 37%
  2. Medically unnecessary: 24%
  3. Prior authorization (payors require physicians obtain approval before the insurer will cover a medication or procedure): 12%
  4. Step therapy (payors require patients use a preferred treatment before using a different medication): 9%
  5. Nonmedical switching (payors switch patient’s medication to another treatment in the same therapeutic class): 5%

Many of these can be prevented by conducting proper insurance verification and prior authorization. It all comes back to the efficient capture of accurate information at the point of care that results in a complete, accurate claim with validated information.

The burden of obtaining both verifications and prior authorizations are on the provider because patients don’t know CPT codes and whether their insurance company requires a prior authorization for a service recommended by their physician. Double checking up front whether prior authorization is required may take some extra time for your staff, but it can save you significant time later trying to chase down claims and payments and prevent having to absorb costs for procedures that weren’t authorized.

Denial management reaps hard earned revenue

The inevitable will happen — claims will be denied. For the majority of practices, 50 to 60% of claim denials go unworked and that can result in 35% of revenue languishing in unappealed denials. What practice can afford to lose 35% of its revenue? The one strategy that can reclaim those hard earned dollars is an efficient denial management system.

Best practices in denial management begin with the denied claim and end with the paid bill. In between is a complex process woven from fine details that begins the timely scheduling of the appeal, correcting coding errors, investigating any other claim errors, correcting and resubmitting the claim. But it doesn’t end there. Denial management must include appeal tracking, payment posting and audits to analyze success rates. Only a comprehensive function with a holistic view of the process can manage and reduce denials.

Successful claims are the pillar of practice revenue. Since HIPAA formalized the use of ICD codes for diagnosis and CPT and HCPCS codes for procedural reporting, practices must use these codes every day in medical billing to create error-free claims. Relying on your own staff for all your coding needs may actually be part of a claims denials problem. Your best strategy may be to implement HIPAA-compliant technology specifically designed to capture accurate claims data and ensure that care provided is care reimbursed.

Artificial intelligence to transform your accounts receivables

Accounts receivables (A/R) can make or break your practice. If your team spends a significant amount of time following up with payors just to get an update on claim statuses, your efforts may be in vain. You need to understand the patterns and reasons why your A/R system makes it difficult to improve operations. You may find that efficiency is lacking and overwhelmed staff is hindering revenue growth.

A/R Assist allows you to quickly and easily follow up on your aging A/R. It combines artificial intelligence (AI) with human intelligence to provide the advanced analytics and predictive insight you need to manage your A/R cycle fully. A/R Assist can help you shrink the time that your accounts are allowed to remain outstanding. By providing in-depth analytics and a reliable team that can track unpaid accounts, the Infinx AI-enhanced system uses machine learning to assess the right course of action to secure your payments.

A/R Assist tackles both A/R resolution and denials management by combining the best of technology and service intelligence to deliver the best-in-class A/R recovery. With the power of a curated knowledge base, and predictive rules based on payor guidelines and procedures, automation, and machine intelligence; A/R Assist determines the next best action on unpaid claims and prioritizes the order and approach of resolution to ensure maximum dollar recovery.

Request a demo of A/R Assist and see how Infinx can transform your A/R . Contact us at

About the Author



Infinx provides innovative and scalable payment lifecycle solutions for healthcare practices. Combining an intelligent, cloud-based platform driven by AI with our trained and certified coding and billing specialists, we help clients realize revenue, enabling them to shift focus from administrative details to billable patient care.

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