The Three "R's" of Denials Management

The fight you are fighting this month is not the fight you will be fighting the next month. The challenges you overcame in 2013 will be replaced by new challenges in 2014. Payors keep throwing new curveballs that, if not managed effectively, could swell your accounts receivable with bulk take-backs.

There are three precepts to denials management that every healthcare provider should put resources behind to nip issues in the bud from the beginning: Root causes, relationships, and risks.

Root cause analysis

The faster you can identify the root cause behind denials, the sooner you can you put the business processes in place to curtail them.

There is no organization where 100 percent of the claims submitted are perfect. But many times a healthcare provider approaches denials from a reactive position, addressing each denial individually with a workflow designed to correct issues with claims one at a time.

By identifying root causes behind denials you can extrapolate those results to your entire claims process and from there adjust your business processes and workflow to prevent future denials from the same causes. But root cause analysis is only the beginning.

At ProSource, analyzing root causes is one piece of a holistic approach to denials management. What we are after is the root cause relationship among and between your revenue-producing and revenue cycle departments. From our perspective, it is what you do after you’ve identified the root cause. We not only use that intelligence to prevent future denials, we also extrapolate the root causes to prevent them on behalf of other clients or from other payors.

Relationships

Denials are like viruses. When a slew of them suddenly appear, you can almost count that similar denials will appear elsewhere. When it comes to payors, there tends to be a herd mentality. Denials from one payor, you will begin seeing similar denials from other payors.

The earlier you are able to identify these trends and how they will spread from one payor to the next, the lower the impact on your bottom line.

Risk analysis

Once you know the root cause and the scope of the issue, you can calculate how big a financial risk a certain type of denial poses to the organization as a whole.

At ProSource, we try to calculate the cost of a denial to our clients, so that they can prioritize how they want to devote internal resources to address it.

Next: Putting the ‘Management’ in Denials Management

Shanna Rogers is a supervisor with ProSource Billing, Inc., a part of the Array Services Group family of companies. Shanna has 13 years of Revenue Cycle experience working with many types of organizations. She has been with ProSource Billing for the last 10 years contributing to and managing projects.