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  • Writer's pictureMuhammad Sair Khan

How Insurance Appeals Can improve Your Revenue




Denied claims are a common problem for physicians and health care facilities across the country. Denied claims can stack up quickly, leaving thousands of dollars that you’ve earned, uncollected.

Unfortunately, office staff and even third party billing companies spend a majority of their time managing the easier-to-collect claims. Additionally, because most claim denials aren’t clear, many billers don’t know how to get the decision overturned.

A recent Kaiser Family Foundation survey found that 19 percent of all in-network claims with Healthcare Marketplace plans were denied in 2017. Shockingly, of those denied claims, only .5 percent were ever appealed. Almost 43 million claims were never appealed, representing millions of dollars of lost revenue or unexpected costs for patients.

Whether you work with a third-party billing company or have in-office billing staff, following up on denied claims is vital to your financial health.

Look for Denial Patterns


There is often a pattern in claim denials. Keep track of your denied claims so you can spot and correct any patterns. Certain policy numbers may require different codes. Codes can also vary by payor. By recognizing patterns, you can take steps to correct the issue and prevent future claims from being denied.

Create a Plan for Denied Claims


Your billing team should be prepared to follow up on denied claims. Whether each team member is responsible for their own denied claims or you appoint one team member to have this important job, you need a system for managing all unpaid claims.

Your system should include:

  • Follow-up processes, such as checking denial codes

  • A timeline for following up with reminders and alerts to keep you on track

  • A packet of important claim documents that you will need to send in with an appeal letter.

Understand Appeals Letters

Appeals letters are the key to overturning denied claims and should include the following information:

  • Prior authorization number (if applicable)

  • Any notes from discussions with insurance representatives

  • Patient name

  • Policy identification number

  • Claim number

  • Your facility name and NPI or tax number

  • Relevant clinical notes that prove medical necessity

  • Authorization of Representation signed by your patient (if applicable)

Keep a record of your appeal letters, making special note each time you win an appeal. Use this letter as a template for future denials. Then, each time you need to draft an appeal, you can simply fill in the specific patient and claim information.



APPEALS 101


There are three types of appeals that you should be familiar with:


  • Level 1 or insurance appeal


  • Level 2 independent review


  • State appeal

Level 1: Insurance Appeal:


A level one appeal is the first step you’ll need to take to overturn a claim denial. Because claim denials vary depending on the type of service and insurance carrier, it is important to include details about the claim, your reimbursement history with that payer and your desired outcome. You’ll also want to include why the service was medically necessary and any authorization you obtained prior to treatment. You may want to include any clinical notes that show medical necessity.



Click here to download a sample appeal letter.



Level 2: Independent Medical Review


If your initial appeal letter to an insurance provider is denied and you do not agree with the decision, you can request an Independent Medical Review (IMR). An Independent Medical Review (IMR) is a process where independent medical professionals review specific medical decisions made by the insurance company. Only certain decisions qualify for the IMR process:


  • Denials based on medical necessity

  • Denials for emergency medical services

  • Experimental or investigational therapy

Level 3: State Appeal


If your level 2 appeal is denied, you can request an external review by the state. Guidelines for submitting an external review can vary by state but typically follow the Department of Health and Human Services' guidelines. You can find instructions on how to submit an external review on the denial letter you receive from the patient's insurance provider or you can request a form directly from the Department of Health and Human Services' website.



Find a Billing Partner You Trust


Resolving denied claims is time consuming, labor intensive and without the correct knowledge, usually unsuccessful. This compounding problem due to increasingly complex payer contracts and utilization rules is leaving many medical providers with limited options, usually resulting high accounts receivable and eventually, write-offs. Don’t miss out on revenue you’ve earned. Contact Datapro today.


Right now, we are offering a complimentary accounts receivable review where we will audit your open and unpaid claims. Click below or more details!



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