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There’s nothing worse than rising AR (Account Receivable) days and falling cash flows. If they last long, they can start crippling your healthcare practice. In fact, 7 in 10 medical providers report that it takes them more than a month to clear their payments.
For most medical centers that come to us with a stuck cash flow – we’ve found that some common billing errors have been putting a wrench in their works. But what’s interesting is that most of these can be easily fixed.
We heard about a similar story recently, where Mitchell (actual name changed for privacy reasons), a heart disease patient, had gone to a cardiac center for a procedure. In a rush, the hospital didn’t verify his insurance details during registration.
As it turned out, Mitchell’s insurance plan didn’t cover the services he received. This oversight interrupted the claim submission and eventually led to a denial. Had the hospital conducted a quick verification of Mitchell’s plan, they could have saved themselves a lot of trouble.
With this in mind, let’s explore the common errors in medical billing and how you can avoid them.
1. Not Double-Checking Insurance Details
As we witnessed above, failure to accurately verify a patient’s details about their insurance eligibility, coverage limits, or plan exclusions can cause significant disruptions. Moreover, oversight in recording key patient information can also lead to denials, making you go through a costly resubmission cycle.
To prevent this, it’s important to ensure an accurate and complete collection of relevant patient details. It helps to have your staff double-check insurance details and plans, confirming that your patient is eligible for insurance.
2. Coding & Billing Errors
Accurate coding and billing are vital in claim approval, and consequently, in maintaining a healthy cash flow. Missing critical information necessary for proper code assignment in different services, or misinterpreting coding guidelines can lead to errors that interfere with your claims.
Recently, while processing some claims for a patient, a billing expert came across a claim that got processed — but only partially. While some Current Procedural Terminology (CPT) codes were accepted and reimbursed, others were denied. The issue arose from the presence of non-specific codes and incorrect modifiers for certain procedures, highlighting how crucial precise coding is in preventing such denials.
It’s good practice to conduct regular internal audits to identify coding errors and areas for improvement; and implement a quality control process to review codes before claim submission. Additionally, offering proper training and ensuring that the billing staff stays current with the latest coding changes and guidelines is essential. This proactive approach minimizes errors and ensures that claims are submitted correctly the first time.
3. Poor Follow-Up on Denied or Rejected Claims
A lack of follow-up can drain your revenue. Without proper monitoring and follow-up on denied claims, you’ll fail to identify and address the root cause for denials – and ultimately invite more of them.
Establish a formal process for monitoring outstanding claims, and encourage proper analysis of denied claims. Frequent auditing helps in understanding the denial patterns and taking corrective measures.
It’s also important to utilize your Practice Management Software (PMS) to the fullest. Ensure that you use it to solve common issues, track claim age status, and resubmit within timeframes.
4. Avoiding Automation
Denials are on the rise for 42% of medical providers. 61% of these providers say that it’s due to a lack of proper automation. This is no surprise. Manual data entry is prone to errors and oversight. Common mistakes such as typos and duplications lead to delays and slow turnarounds in submitting, tracking, correcting, and resubmitting claims.
In these cases, establishing a proper standardized workflow can prevent inconsistencies. Leveraging Electronic Data Interchange (EDI) and Electronic Remittance Advice (ERA) can streamline data exchange and help you access payment information digitally. This speeds up claim submissions and enhances process accuracy.
Studies suggest that automated workflows can reduce the processing time by 48%.
Key Takeaways
If you’ve been making any of these medical billing errors — you probably now understand why your cash flow has been stuck. Understanding and avoiding these mistakes can significantly reduce your claim denials, minimize delays, and hence enhance cash flows.
At Lister, we have a healthy track record of helping our practices minimize AR days, maintain >1% claim rejections, and achieve an impressive 98% first-pass acceptance rate.
With expertise in more than 24 specialties, our medical billing experts have just the right expertise to take over your billing operations, reduce any inefficiencies, and optimize your overall revenue cycle.
Want our experts to review your current billing system, identify any limitations, and recommend ways to address them? Write to us today at contact@listerventures.com to avail a Free Mini Audit!
Improve your Claims, Collections and Optimize Your Revenue with Our Complete Medical Billing Services!
Copyright © 2023 Listerventures. All rights reserved | Designed by Spidergems