Not every medical claim sails through the payer adjudication process. Every healthcare billing professional knows that some claims get dumped right back in your lap for “resubmission.”
Here’s the tough question: How many hours does your staff spend on resubmission?
And the other critical follow-up question: How much do you collect on resubmitted claims?
The answer depends a lot on each payer’s communication or lack of it.
It is obvious – you can not successfully resubmit any claim unless you know what went wrong with the first attempt. Unfortunately, payers don’t always explain clearly the reason a claim failed initial submission. With little information from the payer, the biller must examine the data fields for any potential problem using claim experience and accumulated payer knowledge. This effort may even require reviewing medical records or discussing the claim with another party. Such follow-up work greatly increases the staff time devoted to the resubmission process and overall denial management.
ERA transparency is a term used to describe how well payers communicate claim decisions on the electronic remittance advice (ERA). Another definition, as used by the healthcare firm, AthenaHealth, Inc, is “the percent of electronic remittance advice (HIPAA 835) denial messages with actionable explanations and clear next steps.” Like other healthcare technology companies, AthenaHealth must constantly update billing technology to insure successful electronic claims submission. The company closely studies payer performance on electronic adjudication and publishes a yearly report on how payers are doing on the receiving end of electronic transaction processing.
Payerview 2012, released by AthenaHealth in June, reports that payers are still struggling with the many changes in electronic transactions. One of the metrics AthenaHealth scores payers on is how well each one has adopted the HIPAA 835 standard codes set. Specifically, they are looking at whether payers use “appropriate, clear adjustment reason codes accompanied by remark codes” so that billing professional can easily and quickly correct deficiencies.
“ERA transparency is proving to be a metric with a wide range of performance by major payers, indicating that high performance on transactions can differentiate a payer from its peers,” states PayerView 2012 available at the company’s website, athenahealth.com.
And who is the payer most at fault?
“State Medicaid have traditionally been the lowest performers in PayerView, and this year is no exception; challenges with complex denials and enrollment requirements, coupled with unclear remittance codes, make it difficult for providers to be efficiently reimbursed by Medicaids,” states the publication.
From a broader perspective, poor ERA transparency is what clogs up a clean workflow. Claims sit awaiting resubmission. Resubmission on a non-transparent claim requires research which may mean forwarding an inquiry to eligibility, coding or clinical staff. For this reason, it is important to collect data on the staff hours involved in resubmission, amount collected and the payers with the highest denial rates. Payerview 2012 also reports on payer performance for most of the top payers so you can compare your data with national averages.
Further, Medicaid claims denied without a well-communicated denial reason can be appealed using state and/or federal prompt payment requirements. Using a Medicaid prompt payment appeal letter allows the billing staff to quickly appeal in writing for payment or clarification of the reason for the denial.
The appeal letter should point out if the ERA contained ambiguous denial codes or remarks which do not appear to apply to the claim. Demand clarification of the denial codes using language such as the following:
“In order to assess the accuracy of your initial claim adjudication, we request your response regarding your denial codes and/or denial remarks. It is our position that any claim adjudication communication be clear, compliant with current industry adjudication standards and applicable to the treatment in question.”
Finally, poor payer compliance with adjudication standards should be tracked. Often, healthcare organizations track denials using only the adjudication denial codes which results in a mix of claims which include organization-triggered denials and payer-triggered denials. Such reliance only on the payer denial codes makes payer compliance issues very difficult to track. Consider adding a denial tracking code option of “payer compliance” so that you can easily identify the claims affecting your organizational workflow and denial rates.
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