The healthcare industry is complex and always changing. With so many priorities and areas of business that hospitals and providers need to balance, it can be easy to miss areas of revenue leakage. One area, in particular, can lead to significant revenue leakage: denials management in healthcare. 

Due to its impact on revenue, denials management should be at the forefront of leaders’ minds. There are many ways that providers can properly implement denials management and many systems that providers can take advantage of to streamline the process. We’ll be covering how denied claims result in revenue leakage, some of the most common reasons the claims may be denied, and how to prevent denials in the first place.

Denials Contributing to Revenue Leakage  

With so many current issues in healthcare including wage inflation, rising costs, and worker shortages, providers are experiencing an enormous amount of pressure to focus on the top and bottom lines. Providers are closely inspecting where revenue leakage may be happening and deciding how best to solve the issue in order to increase savings. Automated denials management is a great place to start.

The average denials rate is between 6 and 13% with some hospitals reporting more than 20%. It can cost $25-118 to rework one claim, resulting in less profit. At the same time, 60% of the claims denied are not being re-submitted, resulting in lost profit. Improper denials management in healthcare can cost providers millions. 

Common Reasons for Denied Claims

The best way to manage denials is to prevent them in the first place. Many claims are denied for completely avoidable reasons. With this in mind, it will be useful for you and your team to know the common reasons claims are denied.

Missing or Incorrect Information

Claims can be denied for a simple reason such as a blank field. Each claim needs to be completely filled out and accurate. The information that's missing or incorrect could be regarding the patient's health records, the patient's personal information or demographic information. Automation is the best way to do this as it can inspect the claim, flag any missing or incorrect information, and make suggestions.

The Procedure was not Covered by Payer

Prior to any procedure, the administrative team should be reviewing a patient's plan and receiving authorization. Without doing this, the administrative team may be submitting a claim that’s certain to be denied. 

The Provider was Out of Network

This is very similar to the reason listed above, if the healthcare team reviewed the patient's plan or received authorization, this should not be an issue. However, if the provider is out of network, the payer may deny all or part of the claim.

Late Submissions

Many payers often have deadlines for claims that providers need to meet. These deadlines are usually a certain number of days after the treatment or service occurred. Sometimes the deadlines can also include any time it takes to have to rework rejections so it's important for claims to be submitted in a timely manner. Automation can also help with this by alerting team members to any approaching deadlines.

Duplicate Claims

Due to human error, claims may be submitted more than once resulting in one or both claims being denied and creating confusion as to whether the claim needs to be reworked or discarded.
 

Preventing Denials From the Start 

Many providers understand the importance of denials management in healthcare and have systems in place to help their team with the process. However, current approaches often use multiple systems that create confusion and can slow down the denials management process specifically when it comes to edits.

Exela’s automated denials management solution uses a single platform to streamline the entire denials management process. Our solution takes a denials avoidance approach, helping providers submit clean claims from the very beginning. 

Prior to submission, our PCH Global platform identifies and flags certain-to-deny claims by using its edit engines to assess each claim for Payer-specific edits, SNIP edits, Billing & Coding edits and Compliance edits. Where once providers would need to use multiple systems to look at different edits, PCH Global provides a single platform that addresses each of these edits, streamlining the process and improving turnaround time.

If a claim is suspended or denied, Exela’s denials management solution provides root cause analysis (RCA) which spots trends in the denied claim and alerts you to them. This can prevent the same issues from reoccurring, thus reducing the number of denials in the long term. With dashboard reports and analytic tools, you can identify existing areas of revenue leakage, find new ways to increase savings and experience more visibility into the denials management process resulting in more informed decisions moving forward.

Automate Denials Management in Healthcare

Denials management in healthcare can be simpler, standardized, and streamlined. Given how much revenue leakage can happen due to unoptimized processes, it's time for a more robust solution where providers can focus on the top and bottom line. With our focus on denials avoidance, Exela’s denials management solution brings providers what they need, streamlining the denials management process into a single solution while improving denials rates over time. 

Learn more about what Exela’s denials management solution can do for you.

Claim denials can pose a significant financial burden for healthcare providers, regardless of their size. However, avoiding claim denials is challenging; therefore, having a comprehensive plan and proactive approach is crucial.

What is Claim Denial? 

When patients receive healthcare services, third-party payers such as insurance companies or governmental programs cover some or all of the bill's costs. The healthcare provider submits a claim to the payer during the medical billing process, which may be accepted, paid, rejected, or denied. Visit our blog to understand healthcare automation tools that improve denial management.

Rejections occur when errors are identified during the early processing stages, whereas denials happen after claims have been processed. As a result, denials can be particularly challenging to manage, which is why claim denial management is essential.

Claim denials can have a significant impact on healthcare practices and providers, including:

• - Financial losses: Denied claims result in lost revenue and may cause cash flow problems for healthcare providers.
• - Increased costs: Resubmitting denied claims and appealing them can be time consuming and expensive, leading to higher operational costs.
• - Administrative burden: Managing denied claims can be complex and requires additional administrative resources, which may detract from patient care activities.
• - Reduced productivity: Healthcare providers may need to divert resources from other areas to address denied claims, resulting in reduced productivity.
• - Patient experience: Denied claims can cause delays in payment and additional billing, leading to patient dissatisfaction and negative reviews. This can have a long-term impact on healthcare providers. 
• - Compliance risks: Failing to manage claim denials effectively can lead to compliance risks, such as regulatory penalties and reputational damage.

Overall, claim denials can significantly impact the financial health and operations of healthcare practices and providers, making it crucial to have a proactive approach towards denials management. A denials management service with Exela’s PCH Global can improve cash flow, reduce denial rates, and more.

Understanding Denial Management

Denial management refers to identifying, analyzing, and resolving claims denials in the healthcare industry. A denied claim is a claim that has been submitted to an insurance company or government payer but is not paid because it does not meet the criteria for coverage or contains errors or omissions.

Denial management involves a systematic approach to identifying the reasons for denied claims, rectifying any errors or issues, and resubmitting them to the payer. It may also include appealing denied claims that are eligible for reconsideration. Effective denial management helps healthcare providers to maximize revenue, reduce operational costs, and improve patient satisfaction. In addition, by analyzing and addressing the root causes of denied claims, offering a comprehensive denial management approach that can identify areas for process improvement and implement strategies to prevent future denials.

Healthcare providers can take a proactive approach to denial management by implementing the following strategies:

Identify common denial reasons: Healthcare providers should analyze denied claims to identify the most common reasons for denials. This can help them develop targeted strategies to prevent future denials.

Educating staff on denial management: Healthcare providers should educate their staff on the importance of denial management and provide training on best practices for preventing and resolving claim denials.

Use technology to streamline processes: Solutions like electronic health records (EHRs) and denials management software can help streamline the claims process and reduce the likelihood of errors and denials.

Conduct regular audits: Regular audits of claims processes can help identify areas for improvement and ensure compliance with regulations. Effective denials management solutions such as PCH Global also analyze and track trends from collected data. 

Develop a denial management plan: Healthcare providers should develop a comprehensive plan for managing denials, including strategies for prevention, identification, and resolution.

Monitor payer policies: Healthcare providers should stay up-to-date on changes to payer policies and requirements to ensure claims are submitted correctly.

Engage with payers: Healthcare providers should establish relationships with payers, communicate regularly to understand their policies and requirements, and promptly address any issues.

Denials Management with Exela PCH Global

Overall, denial management is an important part of revenue cycle management in healthcare. PCH Global offers solutions that ensure claims are paid promptly and accurately, enabling providers to deliver high-quality care to patients. The proprietary PCH Global platform identifies to-be-denied claims before submission. Exela's solution also analyzes suspended or denied claims using root cause analysis (RCA) to avoid recurring issues with claims. 

Exela’s denials management solution automatically categorizes based on the reason and remark codes, enabling a more thorough analysis. The solution demonstrates upwards of 30% of all claim line items denials can be avoided. The platform provides immediate guidance for online correction prior to submission. Our edit engines comb through each claim assessing for Payer-specific edits, SNIP edits, Coding & Billing edits and Compliance edits, streamlining the process into a single, simple workflow, reducing time to complete and improving accuracy. 
 

By taking a proactive approach to denial management, healthcare providers can improve their revenue cycle management, reduce costs, and improve patient satisfaction. Get in touch to learn more about Exela’s denials management solution.  

A healthcare provider’s first priority is patient care, but there are also many business aspects that need to be considered, from remaining competitive, to profit, to expansion. It's no wonder that the healthcare industry lags behind other market sectors in implementing automation given the complexity of the business itself. However, with the healthcare industry facing staffing shortages and given the gains to be made through automation, healthcare providers need to step up their digital transformation efforts. 

According to recent research, robotic process automation in the healthcare market is expected to hit around $6.2 billion by 2030, compared to $2.9 billion in 2022, with a compound annual growth rate of 26.01% from 2022 to 2030. With digital solutions rapidly increasing in healthcare, providers that fall behind in digital transformation will also fall behind their competitors. 

What Does Automation in Healthcare Look Like 

Many healthcare providers rely on outdated systems that require tedious manual tasks which take up a significant amount of employees' time and often result in errors. This is where healthcare automation can make a big difference. From submitting claims, to denials management, to revenue integrity, healthcare automation can reduce the amount of time that employees spend on these manual tasks by hundreds of hours.

Healthcare technology not only benefits providers, but patients as well. We've already seen the benefits of improved convenience associated with telehealth services or self-service options for patients who set up their own appointments in a system rather than waiting on hold for a customer service representative. It's time for healthcare organizations to start relying more on technology to improve all stakeholders’ experiences.

With any type of automation, leaders need to be very cognizant of how their employees will accept it. One way to help streamline this process is to make sure that all employees feel comfortable with the technology in place through multiple training environments and communications channels to discuss the functionality.  Allowing healthcare professionals to focus on their core competencies, while the healthcare industry advances, is key to success.

One area where healthcare automation makes a significant impact is in the denials management process.

Automating Denials Management

Traditional approaches to denials management include the use of multiple systems and even manual processing, creating an inefficient system prone to errors. This results in wasted time and resources, creates confusion and extra work, and contributes to revenue leakage. With an average of 6 - 13% of claims denied, denials management is essential to avoiding revenue leakage. If a hospital averages 1 million claims submitted annually, with a denial rate of 6 - 13% and a rework rate of $25 - 118, providers could be losing anywhere from $1.5 - 15.3 million a year. If they chose not to rework the claims, they could be losing even more. This inefficient legacy process is a prime example of where automation can make a significant difference.

Exela’s automated denials management solution has a record of identifying upwards of 30% of claim line items denied that could have been avoided. Exela takes a “denials avoidance” approach to the claim submission process, working to prevent denials before they happen. On top of that, Exela’s system is streamlined, providing convenience and efficiency. With over 35 years of experience, Exela supplies providers with simplicity, standardization, and consistency through a single system. So, say “goodbye” to multiple systems and say “hello” to optimization. 

Submitting Clean Claims Up Front

Exela’s PCH Global platform combs through claims and flags any certain-to-deny items, preventing denials before the claim is even submitted. The platform’s edit engines assess each claim for Payer-specific edits, SNIP edits, Billing & Coding edits and Compliance edits. Where once this assessment required multiple systems, PCH Global streamlines it into one user-friendly platform. 

The PCH Global platform also provides guidance for online correction so users can quickly act prior to submission. This creates a single, simple workflow that reduces time spent on denials management while improving accuracy.  

Addressing Recurring Issues in Denials Management

When claims are suspended or denied, Exela’s denials management solution provides root cause analysis (RCA) to spot trends, thus preventing the same issues from reoccurring. By continually assessing claims submissions and analyzing aspects of the denied claims, Exela’s solution identifies the root cause to reduce the number of denials. 

Exela’s denials management solution also provides dashboard reports to bring more visibility into the process and further improve accuracy. Using analytics tools, users can not only identify existing areas of revenue leakage, but also discover new ways to increase savings. As the denials management system continues to collect data over time, it will provide insights into key trends while tracking the root causes of common errors in real-time. By enhancing visibility into the denials management process, providers can make more informed decisions about their claims processing operations moving forward.

Simplifying the Process

Denials management is a great process to automate due to its capability to prevent revenue leakage, streamline processes, and improve accuracy. While many providers already have systems in place for denials management, it’s time to take a hard look and determine if the systems are really delivering the highest levels of optimization and accuracy for your organization.  Consider if your systems are using the latest technology, minimizing the amount of labor hours required, and providing the results that are needed to address and prevent denials. If not, it might be time for a change. 

Our denials management solution provides a single platform that addresses the entire claims editing and submission process. With Exela’s solution, you’ll be taking a denials avoidance approach, working to correct claims before they’re submitted. Exela’s solution minimizes manual, error-prone processes to streamline operations, reduces denial rates, and ultimately, improves your organization’s cash flow. 

Named a Leader in Everest Group’s Intelligent Automation in Healthcare – Solutions PEAK Matrix® Assessment in 2022, Exela’s healthcare automation tools drive positive outcomes and exceed expectations. Learn more about Exela’s denials management solution today.