A White Paper Overview −Three Best Practices for Managing Hospital Denials

By Andrew Woughter | Posted: 11/20/2017

Ask a health system leader what part of the revenue cycle keeps them up at night, and chances are strong they’ll rub their temples and reply, “claim denials.” nThrive Senior Vice President of Product Strategy and Solutions Executive Management Andrew Woughter, recently authored a white paper that offers thorough details on best practices for building a solid claims denials program. 

Denials are a major area of revenue leakage, and without a robust, proactive management program in place, hospitals stand to lose millions of dollars.  What’s more, roughly 90 percent of denials are preventable by addressing errors in billing and coding.  The most successful health care providers implement a system to prevent denials from occurring at all.  It’s an approach that takes time and effort. 

Here are three best practices for building a denials prevention program and increasing revenue.

1. Assess and analyze your current denials position.

What does your denials inventory look like now?  Many organizations cannot answer this simple question, yet it is key to denial management success.  While commonly tracked financial metrics, such as bad debt write-offs, are important, they don’t paint the full picture.  Claim denials can be concealed by other financial reporting categories, like contractual adjustments.  Do the work − find the root causes of your problems and examine your workflow − to understand your denials data so you can track changes over time.  

2. Empower your team to improve.

Hospital billing processes are complex and process gaps are common.  Because the opportunity for error is high, a combination of automation and human brainpower is required to ensure that process reengineering actually produces desired results.  Make sure there is one workflow in which each team does their part, then passes onto the next team (versus each team following their own independent process) for consistency and visibility to a single source of truth. Engage process owners to help target retraining in order to remain current on payor or regulatory changes. FYI to those who may be relying on paper-based processes – they are no longer sufficient to manage high volume and increasing complexity.  Provide your staff with the tools and training they need to be successful.  

3. Sustain prevention efforts for the long haul.

Educate, train and support process improvements!  Engage leadership across your organization, since denials prevention starts with patient registration.  Shared departmental ownership increases accountability; empower each functional area with their own denials prevention responsibilities to communicate and collaborate regularly with the rest of the denials prevention teams – consider forming a taskforce. A holistic approach will lead to a reduction in your organization’s denials.  

At the core of a proactive denials management initiative is a sustainable, technology-enabled workflow informed by data insights and staff expertise. To manage and ultimately reduce claims denials, organizations must take a more holistic approach, working with leaders in all areas of the revenue cycle and empowering staff through education.

Our advice? Read the white paper and commit to enhancing your claims denials program. The efforts are worth it; take the steps outlined and you could see a huge boost to your claims denials management, not to mention you may gain back an hour’s sleep, too.