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7 Reasons Claims Are Denied — And 5 Steps to Take to Appeal Denials

Appealing denied claims can be a frustrating and time-consuming process for an ASC billing team. Daria Semanyshyn of Advanced Medical Practice Management in Florham Park, N.J., offers seven common reasons for claim denial and five steps for how to successfully appeal a denial.

7 Major Reasons for Denials

Ms. Semanyshyn lists the following reasons as the most common causes for claim denial. Many mistakes, such as improper documentation, can be avoided on the front end and save ASCs from having to appeal denied claims and wait longer for payment.

1. The patient is not enrolled.

2. The procedure is not covered.

3. No pre-certification is on file. Insurance companies often require the ASC to receive approval from the carrier before providing medical services. If pre-certification procedures are not followed, the claim may be denied or the payment reduced.

4. There is a lack of medical necessity for the procedure.

5. No referral is on file. The claim should be filed with a valid referral. If the insurance carrier does not have a valid referral number, the claim will be denied until the referral is provided.

6. There are demographic mistakes on the claim. For instance, an incorrect procedure code that is age appropriate would make the claim invalid.

7. There is a lack of supporting documentation for claim adjudication.

5 Steps to Appeal a Denied Claim

1. Find out why. Ms. Semanyshyn says the first thing your billing team should do when a claim is denied is to confirm the real reason for the denial. She recommends calling the insurance carrier. "Very often, denials come with generic denial codes that do not accurately explain the reason for non-payment," she says.

2. Use the claim number on corrected claims. Ms. Semanyshyn says if you don't use the claim number on a corrected claim, "the claim will error out as a duplicate."

3. Record information about the phone call.
When you call the carrier to re-process a claim, record the date, the name of the representative you speak with and a reference number, Ms. Semanyshyn says. Recording this information will make it easier to reference the encounter if you need to talk to the carrier multiple times.

4. Set reminders about following up. According to Ms. Semanyshyn, your billing team should follow up on each claim at least once every month. To make sure no claims fall through the cracks, the team should set reminders about when each claim is due for a follow-up.

5. Send a clear, thorough appeal letter. If you need to appeal a denial, your letter to the insurance carrier should be clear and thorough to ensure a speedy appeal process, Ms. Semanyshyn says. "Appeal letters should clearly identify the patient, claim number, date of service, member ID and ASC provider number," she says. "[The letter] should be to the point and supporting documentation should be attached." Taking the time to provide all the necessary information in the first place will save your ASC the headache of sending additional information or having your appeal denied.

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