how to effectively analyze and manage the denial...

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Yvonne D. Dailey, CPC, CPC-I, CPB

ALL RIGHTS RESERVED

Why is a service denied? What’s the difference between rejections and

denials? What are the claim edits? How to use the edits on the remits? What are RARC and CARC? Steps to take to correct them What’s the carrier’s term for the denial

process? When to appeal? How to build a relationship with your carriers

Agenda

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90-93% of rejections are data entry error and are preventable

70% of your denials can be overturned

It is estimated that denial and/or rejected claims cost the healthcare industry over 1 million dollars ANNUALLY

This causes payment delays and in some cases payment is NEVER received because the claims were never corrected and/or appealed

What Causes Rejections, Delays &/or Denials

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Some of the common reasons for denials & rejections

Data Entry

Not performing insurance verification

Missing or misuse of modifiers

Not understanding the differences and how to correct them

Not appealing when you should

Mishandled referrals


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Should be handled on the front end not the back

Compare codes on referral and charge ticket

If additional work up is required update referral or obtain a new referral before billing

Denials you will get if not handled properly on front end:◦ No referral on file

◦ Referral exceeds number for referral

Let’s Review Referral Issues

What is a rejected claim?

A rejected claim is a claim that did not have the necessary information to determinate coverage such as billing errors (i.e. Data entry errors, not enough information, truncated ICD10-CM code, )

Rejected claims do not afford appeal rights nor can they be reopened

What’s the difference between a rejected claim and a denied claim?

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What is a denied claim?

A Denied claim is a claim that did not meet the coverage criteria: such as LCD denial, ICD10-CM to CPT®/HCPCS code edits

Denied claims are considered AFTER the coverage determination therefore they DO afford appeal rights

What’s the difference between a rejected claim and a denied claim?

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An appeal is when a provider is dissatisfied with a claim denial and is looking to have a decision overturned. A provider can file an appeal for coding and/or payment rules that were applied to an adjudicated claim

What is an appeal

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1. Previously denied / closed as “Exceeds Filing Time”

2. Previously denied / closed for “Additional Information”

3. Previously denied / closed for “Coordination of Benefits” information

4. Resubmission of a corrected claim

5. Previously processed but rate applied incorrectly resulting in over/underpayment (Network Providers -Check your fee schedules)

6. Resubmission of “Prior Notification Information”

7. Resubmission of a claim with “Bundled” services

8. Other (be sure to detail in writing)

Reason for Request of Appeals / Redeterminations

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1. Deductibles/coinsurance issues

2. Benefit limitations

3. benefits exclusion

4. membership issues

Reasons not eligible for provider Appeals / Redeterminations

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Carriers have their set of rules to follow when filing for an appeal as well as different levels

Know what they require – such as their own forms Know the timeframe for which you can file an

appeal

Online vs. on paper or fax

Know that some carriers, if a member requests an appeal during the review of the providers, the provider appeal is closed

Different Levels of Appeals

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An example of Level 1 appeal for coding or billing disputes

Mutually exclusive services

Incidental denials

Surgical global denials


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An example of Level 1 appeal for Medical Necessity are:

Medical Necessity determinations

Cosmetic services

Investigational/experimental

No authorization for inpatient stays


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Level I appeals vary by carrier

For example BCBSNC has 90 days from the claim adjudication and they have 45 days to complete review

Medicare (Novitas) has 120 days after receipt and 60 days to render a decision

Time Frame for Appeals

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Not satisfied with Level I appeals move on to Level II appeals

Know that the time frame may change for example you know have 60 days from the decision from Level I

Provider had to have exhaust the level I before submitting a level II

Be sure to document everything and it’s best to mail with return receipt


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Know your contract

After exhausting the different levels you may move to administrative Law Judge and again know the time frame which in most cases is 60 days from previous decision

Your contract might speculate that you have to go to arbitration first


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It varies by carriers, some will allow you to file the appeal online through their website

Some require that you use THEIR form and their form only

Most will have a separate mailing address different from where you send your claims

Different Methods to file Appeals

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Provider’s progress notes Provider’s orders Nurses Note Pathology reports Consultant Notes Lab reports Documents that support your appeal Make sure it’s legible AND SIGNED

What Documents To Include With Appeals

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90 claims per day at $105 per claim = $9,450

If 10% denied = $945 in denial per day

52 weeks x 5 days – 20 day (vacations and holidays) = 240 working days,

240 days x $945.00 = $226,800.00 per year

Only 1 in 10 are appealed

More barriers to get paid (referrals, data, contracts)

Sophisticated computer stronger payment algorithms – contract requirements

Your computer to their computer

Algorithm – when in doubt, deny deny deny

Small percentage will follow up

A win for carriers because it saves them money

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You will notice that your remittance advice has a series of codes that indicate the nature of the rejection and/or denial

RARC – Remittance Advice Remark Code

CARC – Claim Adjustment Reason Code

Updated tri-annually (March, July, November)

Can be downloaded from Washington Publishing Company (WPC) website

Rejections and Denial Codes

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www.wpc-edi.com

Provides list of active, deactivated, and list of what WILL soon be deactivate

Review your handouts of samples

Rejections and Denial Codes

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Remittance Advice will offer reasons for denial

Most common reviewed – CARC (Claim Adjustment Reason Code

Most overlooked - RARC (Remittance Advice Remark Code) May vary by carrier

CARC and RARC

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Remittance Advice Remark Code (RARC) for denials

Two types Informational – AlertsSupplemental – Additional information

regarding the CARC

Let’s review

RARC

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Examples of Remittance Advice Remark Code (RARC) for denials such :

M15 - Separately billed services/tests have been bundled as they are considered components of the same procedure. Separate payment is not allowed.

M20 - Missing/incomplete/invalid HCPCS. M24 - Missing/incomplete/invalid number of

doses per vial. PR100 – Payment made to employer/patient OA122 – Psychiatric Reduction

RARC

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Examples of Claim Adjustment Reason Codes (CARC) for denials such :

Co4 – procedure code is inconsistent with modifier used or modifier required is missing

PR26 – Expenses incurred prior to coverage

CO29 – Time limit for filing has expired CO39 – Services denied at the time

authorization/pre-certification was not requested

CARC and NON CARC

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CO - _______________________

OA - _______________________

PR _ _______________________

PI - ________________________

CR - _________________________ ( will be changing as it was not be used with 5010)

B4- Late filing penalty B1 – Non covered visits A1 – Claim/Service denied. At least on remark code must be

provided.

RARC / CARC and Auto Post

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Create a chart for denial/rejections remarks/reasons

Educate and train staff

Eliminate the number of rejections and/or denials for your practice

Review Remittance for Appeal process for each carrier you deal with


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Things to include in your rejection/denial chart:

CARC/Code

Description /Reason

Reason Category

Run by carrier

Run weekly and/ or monthly

Also be sure to review your clearinghouse scrubber


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Using Your Clearinghouse Dashboard

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Sample chart:


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Code (CARC) Description Reason Category

CO97 Benefits included in payment /allowancefor another service

Global

CO104 Managed care withholding

Informational

CO4 Procedure code is inconsistent with modifier or modifier is missing

coding

PR26 Expenses incurred prior to coverage

Eligibility

OA23 Impact from prior payer adjunction including payments and or adjustment

Adjustment

Many reasons for denials and/or rejections that cause payment delays

Analyze date and Identify the root cause for errors

Make either staff and/or carriers accountable

Develop a corrective action plan

Track and monitor your rejections/denials/delays

Establish bench-marks for improvements

Dashboard as a training tool

Avoiding Rejections, Denials and/or Delays

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Create a chart for keeping track of appeals as well

Be sure to enter the information in your practice management system

Be sure to follow up and stay within the carrier time frames

Document any calls and keep all documents in a file for easy retrieval

Finally don’t give up appeal appeal appeal

Avoiding Rejections, Denials and/or Delays

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Name Proc DOS POS units Billed amt Allowed CarcDd C0-in Prov-pdRARC ASG Y MA130 MA15 C0-16 02

Yvonne Dailey 29581-50 9/3/2014 11 2 $ 250.00 0.00 $ 50.00 $0.00 $0.00 $0.00 MA130 M53 M59 Pt Resp: 0 0.00 CARC $250.00 Claim total $250.00

Let’s Review What’s Needed For Claim

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Sample Remittance

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CARC CO-16 Claim/service lacks information or has submission/billing errors needed for adjudication.

02 – Additional information required - missing/invalid/ incomplete data from submitted claim

CO – contractual obligations


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Sample Remittance Breakdown

RARC codes

MA130 – your claim contains incomplete and/or invalid information, and no appeal rights are afforded because claim is unprocessable. Please submit a new claim with complete/correct information

M53/M59 – missing/incomplete/invalid days or units of service

MA15 – Alert – claim has been separated to expedite handling. You will need to review a separate notice for the other services reported.


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Sample Remittance Breakdown

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Name Proc DOS POS units Billed amt Allowed Carc DdC0-in Prov-pd RARC ASG Y MA130 MA15 C0-16 02

Yvonne Dailey 29581-50 9/3/2014 11 2 $ 250.00 0.00 $ 250.00 $0.00 $0.00 $0.00 MA130 M53 M59 Pt Resp: 0.00 CARC $250.00 Claim total $250.00

To correct this claim you need to know HOW carrier wants claims submitted.

In this case they don’t want modifier 50 with 2 units

They want it on two lines with 1 unit each

To correct – resubmit claim with required information.


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Sample Remittance

ICD 10 Will Bring New EOB Codes

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Sample Remittance

ICD-10 EOB Edits Effective 10/01/2015EOB CODE EOB CODE

DESCRIPTIO

N

ADJUSTMENT REASON

CODE

ADJUSTME

NT REASON

CODE

DESCRIPTIO

N

REMARK

CODE

REMARK

CODE

DESCRIPTIO

N

4188 PRIMARY DIAG

CODE NOT

COVERED FOR

DOS

146 DIAGNO

SIS

WAS

INVALID

FOR

THE

DATE(S)

OF

SERVIC

E

REPOR

TED.

MA63

MISSIN

G/INCO

MPLETE

/INVALID

PRINCIP

AL

DIAGNO

SIS.

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Practice Management System

Clearinghouse

Medicare Easy Print (FREE SOFTWARE)

ICD 10 Will Bring New EOB Codes

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837 file readers

Carrier Time Frame

United Health Care 90 Days from date of service

Oxford 90 Days from Date of Service

Aetna 180 Days from Date of Service

Cigna 90 Days from Date of Service

Cigna Great West 15 months

Medicare 12 months (Calendar )

This will differ if the provider is NON PAR. For example Cigna is 180 Days

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Most carriers want your EDI reports to show claims accepted and acknowledged by Payer

Some Carriers REQUIRE you use their forms to appeal

It’s not enough to have an acceptance from your clearinghouse. They want acknowledgement that THEY received it.

If you mailed your claims, then you should have mailed certified with return receipt.

Carrier Time Frame

United Health Care 60 Days from date of remit

Oxford 60 Days from date of remit

Aetna 12 Months from date of remit

Cigna 180 Days from date of remit

Some may require that you use THEIR forms, other may allow you to simply write a request. Forms may vary depending on State where provider is located.

Should ALWAYS BE SENT CERTIFIED WITH RETURN RECEIPT. Keep a file and/or log so you can track

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Be sure to review your EOBs

Be careful with autopost and audit them randomly

Use your charts as a training tool

Appeal Appeal Appeal

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Thank you for attending.

How to contact us: [email protected]

Yvonne Dailey, CPC,CPC-I ,CPB [email protected]

Website: www.daileybilling.com