How Much Does a Denied Claim Cost You?
The answer is more than you think. It is money out of your pocket.
There are two ways a denied claim costs your practice money. First, payment from the insurance carrier is delayed. It is both costly and time-consuming to rework a claim to get it paid and usually requires a lengthy and involved appeals process. The revenue could be lost forever if the denied claim isn’t reworked promptly.
Let’s Break it Down!
The average denial rate is 20% if you scrub claims for coding errors. That denial number jumps to 30% if you aren’t scrubbing for coding errors. So, submitting 20 claims a day would be 80–120 denied claims a month.
Now factor in the cost of reworking these denials. According to the American Academy of Professional Coders (AAPC), that can range anywhere from $30.00 to $115.00 per claim. Taking an average of $72.50 multiplied by even the low end of 80 claims per month, the cost to your practice to rework those claims is $69,600!
Who is Reworking those Denied Claims?
You can see that it is expensive to rework denied claims, but it is also very time-consuming. Does your staff have the extra time to correct claims? Is your medical billing company reworking them, or are they just sitting there? Reworking denied claims is difficult and costly, no matter who works them. This is where an excellent billing company is worth its weight in gold and why you won’t get this type of work for 3% of collections.
If no one is reworking the denied claims, then the revenue is lost forever. Let’s go back to the 80 claims denied each month. If the average charge is $100.00, you are losing $96,000 a year!
What is the Solution?
It is overwhelming to deal with everything that goes into running a practice while providing quality patient care. So, the idea of losing thousands, if not hundreds of thousands of dollars, is devastating.
Several things can be done to minimize mistakes that result in denials. You can institute these steps to improve clean claim submission.
Use best-in-class practice management software. This will help you track referrals, authorizations, eligibility, and critical insurance information.
Make it a practice to verify eligibility and patient demographics at every visit.
Make sure your coding is current.
Obtain pre-authorizations BEFORE the visit.
At Onpoint Medical Solutions, we utilize AdvancedMD, a best-in-class practice management software, to scrub your charges electronically. We scrub the claims, correct them, and submit them within 24 hours of receipt. If an error is found, we don’t send them back to you to fix. Our team manually corrects the mistakes before they are ever submitted. We aim to increase the number of claims paid on the first submission. We want to reduce your bad debt to less than 3% and help you get paid quickly.
For those of you who do not engage Onpoint Medical Solutions to manage your billing and collections, please give us a call or schedule a no-obligation meeting at your convenience. Our goal is to work every claim every day until we collect every dollar owed to you.