The top 3 reasons for radiology claim denials

By Sandy Coffta, AuntMinnie.com contributing writer

June 20, 2016 -- The goal of a well-managed radiology billing operation is to submit claims for services promptly and receive reimbursement as quickly as possible -- enhancing cash flow and keeping overall billing costs low. All too often, however, payment is delayed because the payor denies the claim.

Claim denials sometimes put the entire burden of payment back on the patient's shoulders, usually without good reason, and the person's immediate reaction is to call the practice's billing office to complain. This creates additional work for the billing office to handle the phone call, research the problem, obtain corrected information, and resubmit the claim -- all of which must be done before the expiration of any timely filing rules the payor might impose.

Common claim problems

In my experience of managing the revenue cycle for several radiology practices, there are three top reasons for claims to be denied:

  1. Patient eligibility problems
  2. Failure to obtain proper authorization for the procedure
  3. Failure to document the medical necessity of the exam

Claims can be denied due to problems with patient eligibility in quite a few ways. These include listing the incorrect site of service or the incorrect insurance company (or plan) information on the claim, as well as demographic issues that occur in the registration process. Insurance companies and Medicare expect all of the pertinent information about the patient to correspond exactly with their records. Any mismatch along the way will create a denial of the claim, bouncing it back to the radiology group to make the correction.

Sandy Coffta
Sandy Coffta, vice president of client services at Healthcare Administrative Partners.

Many insurance plans require prior authorization for imaging procedures, especially those that are higher in cost, and the advent of ICD-10 diagnosis coding has increased the level of specificity required in the preauthorization process. Performing these services without first obtaining prior authorization will generate a denial. A mismatch between the exam performed and the authorization will also cause a denial. Again, the payor is looking for information that matches its records and payment criteria. The radiology group will not be paid until everything lines up.

Payors have medical protocols that dictate the conditions under which certain procedures are to be performed. The physician must be sure that the performance of any exam is medically necessary in the diagnosis or treatment of the patient's condition, being cautious not to order tests where the only documented indication is to 'rule out' a particular condition. Denials of claims for medical necessity usually result not from the physician's patient care decisions but rather from the information conveyed to the insurance payor. Good documentation to support the reason for the exam is crucial, including details from the patient's history.

Avoiding denials

A good billing service will proactively manage claim denials, hopefully in advance of the patient's phone call. But even so, a far better solution all around is to avoid denials in the first place. The process of successfully generating clean claims that are paid the first time they are submitted begins with gathering accurate data even before the patient exam takes place, then ensuring that the claims are complete and accurate. This is hardly a new topic, but it is one that needs constant attention to maintain efficient billing and optimize cash flow for a radiology practice.

Sandy Coffta is vice president of client services at Healthcare Administrative Partners.

The comments and observations expressed herein are those of the author and do not necessarily reflect the opinions of AuntMinnie.com.


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