Dealing with insurance companies can be a pain. Whether you are a patient or provider, it is difficult to understand how insurance works, what services your policy covers and the correct reimbursement rate. As insurance premiums are at an all time high, coverage is more scarce than ever before.
Below, we've outlined the most common reasons for claim denials and the simple things you can do to have the denial overturned.
After you verify that the service you wish to provide is covered under your patient's policy, the next step is to request an authorization for treatment. To do that, your utilization review specialist will speak with an insurance case manager to determine what is medically necessary for the patient. Once a treatment plan is agreed upon, the case manager will provide you with an authorization number and input that number into their system.
If you receive a claim denial stating that there is no authorization on file and you are certain that the authorization you received covers the service that you billed; verify that the authorization number on the claim matches the authorization number in the insurance database. Typo's are more common that you think.
Always keep notes and call reference numbers that the case manager provides you. This will save you a lot of time and will also make a stronger case if you have to write an appeal letter later on. The more information you have, the stronger advocate you will be. Always note the date of your call, the name of the representative you spoke with, the outcome of the call and the call reference number.
Rejected Billing Code
One of the most common reasons for a claim denial is Incorrect type of bill (TOB) or unaccepted Rev/CPT code. Each insurance company has different guidelines for how to code and submit claims. Occasionally, the case manager at the insurance company will tell you what CPT code they are approving but other codes such as TOB, DRG HCPCS, etc. are the responsibility of the biller.
If you receive a claim denial for a coding issue, you will need to call the insurance company for clarification. If you get lucky, the insurance rep will give you the information to update the claim. Most likely, you will need to reference previous claims in your database that were paid by that payor.
Charge Exceeds Maximum Allowable
Sometimes a claim will deny stating that the patient has exceeded the allowed amount for the billed service. If you believe this is an error, refer to the verification of benefit to see if there are any written limitations within the policy. If you still believe that the claim was denied in error, call the claims department at the patient's insurance company and have it sent back for reprocessing. Always reference the authorization number and any other dialogue that you may have had regarding this claim.
Non Covered Service
If you are an 'Out of Network' provider and bill an HMO policy, your claim will deny even if you got prior authorization. Prior authorization does not guarantee payment. In this case, you will need to request a retro-authorization or submit an appeal letter. Always check and then double check the VOB. Read any small print that lies within the insurance policy for exclusions and limitations.
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There are many intricacies when it comes to insurance billing. Even if you follow all of the appropriate steps, insurers still incorrectly deny claims, 'lose' or never process medical records, and request additional information. Consistent insurance reimbursement requires meticulous attention to detail and constant follow-up. Speak with a Datapro Claims Management Specialist to improve your claims management process.
For more information on this topic and much more, view our Behavioral Health Guide to Quick and Accurate Claims Processing. You can also download the PDF format by clicking on the image below.