Denied claims have been a challenge for health systems, hospitals, and physician practices for many years, but the problem is getting worse. In 2023, denials rates reached 17% of all in-network claims, 24% for authorization denials, and 37% for medical necessity denials.² The financial impact is also increasing; more than 22% of organizations surveyed said they lose half a million dollars annually due to denials, and one in ten report losing more than two million.³ With sluggish margins and continuing labor shortages, provider organizations cannot afford a status-quo approach to denials. In other words, just accepting that they are inevitable can be a costly mindset.

One of the most significant causes of denials is a lack of communication between the clinical and revenue cycle teams. Traditionally, the clinical documentation process and the billing process are seen as two separate processes performed by two separate teams. However, because so many denials originate in the clinical documentation process, it has become essential that these teams work together to identify and proactively address these problems together. In this blog, we will discuss three proven steps providers can take to do just that.

Establish Open Communication Channels

One of the most impactful methods of encouraging collaboration and communication is developing shared goals. A vital component of this endeavor is for teams to share specific key performance indicators, of which denial rates should be at the top of the list. Realizing how their work impacts the entire team’s success and having it tied to incentives or salaries can go a long way in creating more productive, collaborative teams that deliver high-quality work. When everyone works toward the same outcome, it improves transparency and accountability.

Another vital part of establishing better communication and collaboration is through regular meetings where ideas and feedback are nonjudgmental and welcome. These meetings should include reviews of identified issues or patterns that have led to denials using real examples. The billing team is reliant on the clinical team to be thorough in their documentation processes and the clinical team is reliant on the billing team to ask questions and to close the loop when information is incorrect or missing. These meetings are the perfect platform to enable resolution, collaborative problem-solving, and decision-making.

Implement Ongoing Education and Training Initiatives

Multidisciplinary training as a part of a comprehensive education program is critical for improving collaboration and reducing denials. Each team must understand the nuances and challenges of the other. This enables teams to gain insight, which is vital to developing better processes. For example, the clinical team needs to understand how claims with inaccurate documentation can result in denials, and they need to understand the process entailed on the back end to research and resubmit the claim for appeal. The billing team needs to be educated about the clinical documentation process so they understand the appropriate steps to take and who to reach out to when an issue arises during the coding process.

Education that includes training around all clinical and revenue cycle processes—from documentation to claims submission to denials management—is critical to better collaboration, process improvement, high-quality work, and reduced denials.

Leverage Automation Technology

Multiple technology solutions are now available that can help organizations gain greater clarity, improve efficiencies, and promote collaboration. Artificial intelligence (AI) has gained considerable attention, along with robotic process automation (RPA) and machine learning (ML).

AI is particularly helpful for improving clinical documentation, especially in the area of medical transcription. AI can generate accurate clinical notes based on a clinician’s recording, and ambient AI tools can capture conversations during patient encounters and turn those conversations into notes. Instead of spending hours at the end of a day entering notes in the EHR, clinicians can simply review the notes generated by AI and approve, make alterations, and approve. In this way, AI helps improve documentation quality and, ultimately, coding and billing accuracy.

On the revenue cycle side, RPA can automate typically manual coding and billing processes through rules-based actions to perform transactions and complete repetitive processes without human intervention.⁴  The result is a reduction in errors that lead to denials so they can be proactively addressed before claim submission.

Another way that technology can help improve collaboration and reduce denied claims is through analytics. AI and related technologies perform root-cause analysis to help identify where denials originate, as well as problematic trends in documentation and coding that lead to denials. This information helps inform organizations about the corrective actions that need to be taken in both teams to prevent denials in the future.

References

1. https://www.mgma.com/mgma-stats/6-keys-to-addressing-denials-in-your-medical-practice-s-revenue-cycle
2. https://www.kff.org/private-insurance/issue-brief/claims-denials-and-appeals-in-aca-marketplace-plans/
3. https://revcycleintelligence.com/news/claim-denials-pose-expensive-problem-for-providers
4. https://revcycleintelligence.com/news/high-impact-robotic-process-automation-use-cases-for-the-revenue-cycle