Claim Denials- What’s the Next Step Harvey Richman,OD,FAAO,FCOVD

1. All information was current at time it was prepared 2. Drawn from national policies, with links included in the presentation for your use 3. Prepared as a tool to assist doctors and staff and is not intended to grant rights or impose obligations 4. Prepared and presented carefully to ensure the information is accurate, current and relevant 5. No conflicts of interest exist for the presenter- financial or otherwise

6. Of course the ultimate responsibility for the correct submission of claims and compliance with provider contracts lies with the provider of services 7. AOA, AOA-TPC, its presenters, agents, and staff make no representation, warranty, or guarantee that this presentation and/or its contents are error-free and will bear no responsibility or liability for the results or consequences of the information contained herein

 CPT ® Procedure Codes  What You Do  ICD-9-CM/ICD-10-CM Diagnosis Codes  What You Find  HCPCS Codes  What You Supply (sometimes what you do)  Modifiers  What is Different

 The goal of this process is to pay  the right amount  to the right provider  for the right service  to the right beneficiary.

 The claims management process in the physician office is the internal workflow for preparing, submitting, and collecting claims.

 All members of the physician office team have a role in the claims management process.  Registration  Clinical Staff  Physicians  Coding  Billing  Collections

● Increased staff efficiency ● Streamlined claims billing processes ● Increased number of clean claims submitted ● Reduced number of claims denied ● Timely and accurate payment from the health insurer

Pre-Registration – Accurate collection of patient demographics and health information – Verification of insurance and applicable deductibles/copays/co-insurance Patient Check-In – Copying patient’s health insurance card – Verification of insurance information

Collect co-pays, co- insurance, deductibles and fees for non-covered services prior to filing claims Some office collect prior to visit Most collect at end of visit Some bill after insurance response Final bill should reflect all charges incurred and payment determinations Maintain confidentiality

Documentation of Services Provided – Patient's history, symptoms, diagnosis and treatment plan including labs or x-rays ordered “If it isn’t documented, it wasn’t done”

 Patient Check-Out – Schedule follow-up – Collect co-payment or deductible – Special payment arrangements

 Code Verification and Review – Use the encounter form to create claim for patient – Billing specialists and coders must be familiar with Medicare guidelines and commercial insurance carrier guidelines

Claim Generation – Codes and fees are entered accurately and a claim is generated  Claim Review – Billing specialists review the claims for accuracy, correct as needed, and submit to insurers

Claims Processing, Adjudication, Payment – Health insurer should review the claim, approve, and route payment and a copy of the EOB to the physician office. Original EOB is routed to patient.  Collections/Claim Follow-up – If insurer not processing claim in timely manner, collections staff follows up with insurer

Posting Payment – Collections staff should verify payment according to contract and post in accounts receivable  Claim Appeal – If collections staff deem payment inappropriate, investigate and appeal the denial

 The patient's chart must have documentation that will support the level of service or procedure provided.  Proper documentation allows coders to translate medical documentation (words) into numbers.

 CPT and diagnosis codes must accurately reflect documentation for visit – Global fee periods for surgery – Modifiers – Medical necessity

Understand the insurance carrier’s use of universal codes At least sixteen ways to code an eye examination Some insurance carriers may have specific policies or guidelines Check each insurance carrier’s specific policy regarding coding

Understand the regulations of the insurance plans in the area  Does the office participate?  What charges are covered?  Are there limits to charges?  Is verification required?  What claim forms are needed?

Understand how the office chooses to handle insurance plan payments  Accept payment directly from the insurance company as payment in full  Accept direct insurance payment as partial payment and have patient responsible for balance  Do Not accept insurance payment

 Complete and submit claims in a timely manner  Fill out forms completely and accurately  Ensure accurate CPT and ICD-9/10 codes  Become familiar with vision plan claim forms  Keep a copy of all submitted forms

 Claims are required to be filed electronically  Better tracking and faster payment  Claims must be accurate  Claims must be on CMS 1500

Patient identification Patient insurance data Services and diagnosis (ICD-9- CM/CPT/HCPCS) Provider information Authorization to file a claim Authorization for payment allowance Information related to patient’s current illness or hospitalization Charges Payments (as applicable)

 Developed by National Uniform Claims Committee (NUCC)  Medicare began accepting, 02/12 version 1/2014  Medicare began only accepting 02/12 version 4/2014

 Adds functionality  Indicators to differentiate ICD-9-CM & ICD-10-CM diagnosis codes  Now can use 12 diagnosis codes  Ability identify provider roles (on item 17):  Ordering  Referring  Supervising  Align CMS /12 with changes in P electronic standard

New QR code at top of form

 Diagnosis codes added without decimal points  Example Acute atopic conjunctivitis  ICD-9-CM  H10.13 H1013ICD-10-CM

Box 22

 Denials of claims are insurer/intermediary rejections of coverage of procedure(s)  Insurers refuse access to benefits and reimbursement, but do not deny access to treatment, which only a provider can do – insurers simply don’t pay  Denials are sometimes called Adverse Determinations  Denials are a fact of life (some estimate as high as15% of all claims)  High denial rates are costly and preventable

 Reasons for Denials – Medical necessity – Missing or invalid CPT or HCPCS code submitted – Incorrect patient identifier information submitted ● Spelling of name, date of birth, subscriber number missing or invalid, insured group number missing or invalid – Procedure/surgery requires prior authorization or precertification – Place of service does not match surgery/procedure performed – Claim submitted for non-covered service

REFERRAL A referral is a request (verbal, written, or telephonic communication) by a PCP for specialty care services. 34 PRIOR AUTHORIZATION Prior Authorization is an approval from carrier to provide services designated as needing approval prior to treatment and/or payment.

Common types of denials include:  Administrative - patient or provider failed to follow plan rules and broke with required processes  Clinical - plan deems recommended treatment is inconsistent with generally-agreed upon standards and guidelines  Policy: plan has pre-determined exclusions and limitations on reimbursable procedures and providers NCCI Edits

National Correct Coding Initiative (NCCI) Developed with RBRVS Insures proper Medicare payments (Resource Based Relative Value System) Identify pairs of services not billed together o by same physician for same patient on same day Component element edits o and Medically Unlikely Edits (MUE) policy manual o or and but MAY use -59 modifier o and may NOT be used together even with -59 modifier

NCCI Edits MUE together, column 1 code is paid MUE MAY be allow together o 0 not allowed o 1 allowed o 9 non-applicable o If clinical circumstances justify appending a modifier to column 2 code of code pair, payment for both codes may be allowed MUST READ AND UNDERSTAND WHAT CAN BE DONE TOGETHER AND WHEN Cannot use a modifier just to get paid

 Appeals of insurer denials are provider initiated actions to redress a provider-perceived error, following the insurer’s established, published procedures  Appeals are generally undertaken to contest a clinically-based denial, but they can also relate to procedure and policy interpretation  Many denials for “easily correctable” administrative reasons can simply be resubmitted as a new claim, rather than undertaking the more elaborate appeals process  Appeals can be time consuming and expensive

 Reviewing, correcting and re-submitting denied claims is central to revenue management strategy  Assign dedicated staff person to denials if possible  Document receipt of denials, reasons for denied payment and deadline for re- submission

 Always review denial reasons (read twice, act once)  Make corrections involving missing or inaccurate info  Review clinical reasons for denial (service, diagnosis, etc.) with treating clinician  Make any corrections possible  Re-submit claims in a timely manner  Measure, measure, measure !

Common Coding Errors Incorrect diagnosis code Omitted modifier Improper coding pairs Use of deleted CPT codes Lack of NPI numbers: procedures/referrals/tests Lack of Advanced Notice to Beneficiary

 Documentation Mistakes – Physician “short-cuts” in documenting medical necessity ● Clear to physician; not clear to insurance claims reviewer ● Claims reviewers look for – Specific terminology – Descriptions that match insurance policies

 Time Limit For Filing Has Expired  Claims must be received within 120 calendar days of the date of service (Contracted Providers)  Bill Primary Insurer 1 st  Verify other insurance. Medicaid is the payer of last resort 43

 Coverage Not In Effect When Service Provided  Check eligibility at each visit prior to submitting claims to ensure that you are billing the correct carrier  Non Covered Service For Package B Member 44

Clearly mark RESUBMISSION or CORRECTED CLAIM at the top of the claim. BOX 22 on CMS 1500 Must attach EOB, documentation, and explanation of the resubmission reason. XX calendar days Providers have XX calendar days from the date they receive their EOB to file a resubmission. 49

 In the health care industry, regulators are employed to ensure providers are documenting and billing according to law – Office of Inspector General (OIG), – Auditors from governmental payers, – Auditors from commercial payers, – Attorneys

 Why is an Advance Beneficiary Notice (ABN) Needed? – If Medicare deems a service “not reasonable and medically necessary”, and the patient decides to proceed with the service, the ABN is used to bill the patient for the services provided

Advance Beneficiary Notice of Non-coverage (ABN)  MUST USE THE OFFICIAL FORM  May be used for voluntary notifications  Mandatory field for cost estimates of items/services  New beneficiary option  Patient may choose out-of-pocket payment and not have a Medicare claim submitted

Advance Beneficiary Notice (ABN) New form required use - January 1, 2012 In English and Spanish Must deliver before service rendered Copy must be provided to beneficiary May photocopy the original signed form Doctor retains the original ABN Must keep for 5 years from discharge/care completion May remain in effect for one year ABN never delivered in emergency situations

Advance Beneficiary Notice of Non-coverage (ABN) ABN delivery required: Services not reasonable and necessary Medical equipment and supplies supplier # requirements not met Medical equipment and/or supplies denied in advance Custodial care Hospice patient who is not terminally ill

Reasonable and Necessary ABN Criterion Examples Deluxe frame – glasses after cataract surgery More than usual # Scanning lasers More than usual # Visual fieldsNew test not yet covered Anything you think may be denied

Option 1: Probably most common Option 2: CANNOT bill Medicare Option 3: Patient rejects service

 GA Modifier  Expect denial item/service not reasonable/necessary  ABN signed and on file  GZ Modifier  Expect denial item/service not reasonable/necessary  No ABN signed and on file  GY Modifier  Indicate service is statutory excluded/non- covered  File claim only if patient requests or need denial

 If possible, resubmit a corrected claim, but otherwise respond with an Appeal  Know and follow their written appeals process  Request the standards or guidelines on which they base their decisions  Review with your senior clinical staff and prepare your appeal

INFORMAL CLAIM DISPUTE/OBJECTION Level One Appeal  1 ST step in the appeals process  Should be made in writing by using the Dispute/Objection form  Submit all documentation supporting your objection XX calendar days  Send to payer within XX calendar days of receipt of the EOB  A call to Provider Inquiry does not reserve appeal rights 60

 Why was it denied?  Can it be fixed?  Is it a correction or an appeal?  Can I prevent it from happening again?

AOA Resources Many resources available but it’s up to you to seek answers –Free service to AOA members and their staff Don’t be shy about asking your questions. Go to and use the Ask the Coding Experts submission form found under Resources Be sure to register for future medical records & coding webinars at

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