Getting a handle on denials helps revenue integrity

Process improvement opportunities abound

Karen Bowden, senior vice president of Craneware InSight, recently discussed denials management with Healthcare Finance News Editor René Letourneau.

What are the best ways to reduce denial rates to strengthen the revenue cycle?
In my experience, the most effective approach to reducing denial rates comes from the implementation of a well designed denials management program, which is focused on root cause analysis and followed by fully implemented and effective corrective action plans. By digging into aggregated denials data, organizations can identify their highest value and highest volume denial categories and begin to investigate and remediate the root causes of those denials. Also, by identifying reoccurring denials that are resulting in the greatest losses, organizations are better equipped to prioritize their remediation efforts. With the extremely inadequate denials data sets that most provider organizations deal with, having good tools to automate the data aggregation and analysis processes can be extremely beneficial in helping to eliminate revenue loss associated with denials.

How does/will automation help improve denial rates?
Automation tools can be extremely valuable in supporting revenue integrity professionals. With many organizations having to stretch their staff increasingly thin, automation can help denials teams keep up with changing payer rules and edits, and speed up the process of denials data aggregation and analysis. Automation can also play a role in the communications and workflows required to quickly assign denied claims to the person best suited to correct it as well as assist in tracking down root causes to the appropriate departments and individuals so that corrective actions can be implemented. Finally, automation can help to measure the impact of process improvements at the organizational, departmental and individual levels.

What kind of ROI could a provider expect to see with automated systems?
By supporting revenue integrity professionals with tools designed to automate the process of denials root cause analysis, we have seen many organizations that have been able to realize significant ROI in a very short time. It is important to understand that simply implementing tools designed to support automation is not an instant fix for high denial rates. While it is a big step in the right direction, it is still essential to support automation with an organizational culture focused on accountability and revenue integrity.

What impact do you expect ICD-10 to have on denials?
This is a difficult question due to persisting speculation over ICD-10. One thing that I suspect is that most providers and payers are equally behind in terms of preparedness for ICD-10. However, moving to ICD-10 provides all the more reasons why organizations need automated denial management reporting.

What trends do you expect to see around denials management in the next 12 to 18 months?
If and when ICD-10 does come into effect there will be a long-term trend around understanding and addressing its implications. As we continue to see some organizations shifting toward models like accountable care organizations or global payments, there may be an initial spike in denials followed hopefully by a general decrease. Denials will continue to constitute one of the main areas of focus for limiting revenue leakage. It will be increasingly important that healthcare providers are collecting all earned revenue and leaving nothing on the table.

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