Are you struggling with ensuring that every prior authorization translates into a claim approval? Is it perplexing to understand why a payor does not approve a claim? Unfortunately, these medical billing challenges are common as providers try to get paid for services rendered.
Let us preface by saying that you know how to provide the best care for your patients as a physician and medical practice owner. However, the truth is that successful medical claims directly influence your patient’s experience in dealing with your practice. Therefore, understanding how prior authorizations and claims submissions work and how you can reduce claim denials is an essential part of offering medical service.
In our previous post titled ‘Difference Between Referrals & Prior Authorization in Medical Billing,’ we explained the different types of prior authorizations and the common claim approval challenges faced after authorization is received. In this blog post, we want to elaborate on prior authorizations /referrals and minimize the risk of claim denials.
Before we share the tips, it’s important to highlight that the authorization department is separate from the claims processing department in an insurance company. Surprising as it may seem, these two departments do not work together. So even if you obtain authorization for a medical test or procedure, there is a risk of claim denial.
Therefore, if you want to minimize or eliminate the risk of claim denials, it’s imperative to follow these medical billing tips.
- Upfront insurance verification: You will not be paid if the patient’s policy does not cover said service. Do your verification of benefits before the date of service. If the patient has a limited plan or an exclusion, collect the payment upfront from the patient.
- Obtain prior authorization: The word ‘prior’ means that the approval must be obtained before the service is rendered. The failure to obtain prior authorization dramatically increases the risk of non-payment by the insurance company.
- Document medical necessity: You will not be paid if the medical condition is not documented to the insurance company’s satisfaction. Please note the need for the medical test/procedure in detail.
- Be familiar with Local Coverage Determinations or LCDs: An LCD is a decision by a Medicare contractor whether to cover a particular item or service. You will not be paid if a claim is not submitted with an LCD.
- Ensure that document matches diagnostic coding (DX): If the documentation submitted does not substantiate the DX, you will not be paid. For instance, if the patient comes in for a post-op appointment in the global period, but you use a DX for an unrelated problem and assign an E/M instead of a post-op visit, you risk a claim denial.
- Use the correct CPT code: Please do not base your service codes on what your salesperson tells you. Reference the current list of Medicare CPT codes before claim submission.
- Do not bill an office visit (OV) every time a patient visits your office: The days of every visit to the office being billed as an OV code are over. Suppose you evaluate a patient and recommend that they receive injections once a month for the next three months. You have already assessed and devised a treatment plan. Do not bill for an office visit when the patient visits your office for the follow-up injections. If the patient asks about a new problem while there for the injection, only then can you bill for an E/M service (Evaluation and Management).
- Understand the intricacies of billing physical therapy (PT): Physical therapy practices are different from regular medical services. You need to remember this when you code and bill for the claims. For instance, in PT billing, the time of service is categorized into pre, intra, and post time. You need to mention the service category in all the PT claims.
- Follow the formularies or medical guidelines issued by the payor: Most payors offer guidelines for certain tests/procedures. For instance, if behavior modification and three months of PT are required before treatment, you must document the medical necessity after PT for three months and behavior modification.
One of the most powerful resources at your disposal to reduce denied claims and improve revenue collections is to partner with a professional medical billing service. With an experience of almost two decades of boosting revenues for healthcare providers, team PracticeForces is at your service for assistance with medical coding and billing, credentialing, AR collections, patient billing and communications, and EHR upgrade. Contact us to know more.
