Dealing with Medicare claims can be challenging; maximize reimbursement by submitting claims accurately the first time.
Medicare pays hospitals about 40% less than private insurance for inpatient services and doctors about 30% less for their services. Submitting Medicare claims is also more complicated than submitting claims to private insurers.
Regardless of the challenges, successful healthcare organizations must adapt and follow Medicare’s rules to operate profitably because of the major role Medicare plays in the healthcare system. Medicare spending is projected to grow at an average annual rate of 5.1% over the next 10 years, due to growing Medicare enrollment, increased use of services, intensity of care, and rising healthcare prices.
The best way to maximize your Medicare reimbursement is to submit claims accurately the first time, so your resources aren’t spending time correcting and resubmitting. This seems obvious, but many providers just accept denials as part of their staff’s daily workload. But, it shouldn’t be that way.
Consider these facts about claim denials and think about how much your organization could be leaving on the table:
- When a claim is rejected, it can cost 4X more to manually fix it and resubmit than it cost initially.
- 60% of denied claims will never be paid.
- On average, 10-20% of healthcare revenue is tied up in denials.
- For every 1% of claims denied, it can cost an organization between $50,000 and $250,000 in lost revenue.
- On average, the cost to file an initial claim is $6 versus the cost of $25 to re-process a rejection/denial.
If your organization is using a technology platform to manage your revenue cycle, ask your vendor if they have a solution that connects to HETS (HIPAA Eligibility Transaction System) before a claim is submitted to check for errors. With the right solution, you can reduce your Medicare eligibility and registration denials – the top reason for Medicare rejections or denials – by over 78%. Claims are error prone because of the manual review requirements – but the good news is that nearly all errors are avoidable!
Not only will a good solution be able to identify errors before submission, it should also provide reports with the actionable information you need to know to understand the top error codes, total claims amount, and the volume of claims for each error code. This insight can empower your staff to drill down into the top error codes to identify and correct any encounters or trends associated with those codes.
Some of the additional insights you should have automatic access to include:
- The exact beneficiary name in the Medicare system.
- Frequency restrictions for 21 preventative care procedures, and the next eligible date for the patient for that service.
- Identifying an HMO/Managed Care/PPO for the patient to prevent incorrect billing.
- Hospice enrollment eligibility, including hospice period dates, hospice NPI, and the associated revocation codes.
- Ability to capture SNF, hospital, and lifetime reserve day limits and uncover the days remaining.
- Therapy caps for occupational/physical/speech therapy, when caps are exceeded, or the cap remaining.
- Capability to pinpoint complete liability and indicate when Medicare is secondary to Working Aged Beneficiary, ESRD Beneficiary, or Auto.
- No-Fault, Worker’s Comp, PHS or Federal Agency, Disability, Black Lung, or VA Benefits.
If you don’t have a technology partner, these are things you should consider when evaluating vendors. What percentage of your claims are submitted to Medicare? What is your denial rate? How much revenue are you potentially leaving on the table?
If you’re ready to minimize Medicare denials and rejections, and optimize your resources, I’m ready to share more information. Let's talk!
Ken Magness is a focused healthcare professional with more than a decade of experience in helping clients understand the true value of automation in the revenue cycle management process. As the Strategic Initiatives Leader at Quadax, Ken and his team are passionate about connecting with healthcare providers to help them create and leverage the appropriate technology solutions to optimize the revenue cycle process and improve the experience of their patients and staff.