The golden rules for commercial denial prevention and maintenance

Friday, October 20, 2017

Denials may seem impossible to avoid, but just why are they so common? “The way the auditor structure was set up in the Medicare world and the medical loss ratio, and just the business pressures nowadays on the commercial insurers, are driving these denials,” says Kurt Hopfensperger, MD, JD, vice president of compliance and education at Optum Executive Health Resources in Newtown Square, Pennsylvania.

There are three types of denials that tend to impact revenue integrity. Medical necessity denials are usually the most impactful as they have the largest summit risk, often reaching into the thousands for insurers, according to Hopfensperger. Medical necessity denials can occur when an inpatient stay is downgraded to an observation stay by a commercial insurer. The second-most impactful denials are coding- and diagnosis-related denials, followed by technical denials.

While technical denials are common, their impact on revenue integrity is less. Documenting the incorrect diagnosis is going to be less costly than having the entire patient stay denied, says Hopfensperger. But although technical denials are common, they are also the ones that a facility should be able to prevent. Common causes of technical denials—like lack of preauthorization or lack of assigned order for a Medicare patient—are simple mistakes that will have an impact on whether your facility will get paid for the correct patient status. 

“Technical denials will always be there because your front-end staff are least paid,” says Bill Malm, ND, RN, CRCR, CMAS, managing director of Health Revenue Integrity Services in Cleveland/Akron, Ohio.

Last but not least is the commercial denial, which has proven problematic. “The big concern seems to be the commercial payers changing the rules as to what is payable and what is not,” says Steven Greenspan, JD, LLM, vice president of regulatory affairs at Optum Executive Health Resources.

To combat commercial denials, first make sure your facility is prepared in both denial prevention and denial maintenance. While it is best to catch denials before they occur, in reality, no one can catch every denial.

“You’re not going to win them all, and probably you shouldn’t win them all,” says Hopfensperger. “No hospital’s perfect; no hospital’s going to get the physician’s supported diagnosis all the time.”

Denial prevention

The first step, albeit the most obvious one, is to have a system to prevent denials from happening in the first place. Establishing a denial prevention program that works for you is key in preparing for denials that could otherwise slip through the cracks. This will look different at every facility—the most important thing is to be consistent in your processes and double-check your work.

 

Be consistent with your facility’s utilization review process.

Denial prevention starts with a strong utilization review process, says Greenspan. This includes having nurses and doctors who are correctly documenting their work. “It’s incumbent upon a hospital to provide the resources to have appropriate staff for the correct documentation and status while the patient is in the hospital,” he says. Move the utilization review process as close to the beginning of the revenue cycle as possible—ideally it starts with the patient’s arrival to the floor (for both inpatient and outpatient).

 

Review cases daily to ensure patient status is correct.

Utilization review goes hand in hand with the next step, which is to review cases to double-check patient status. Hopfensperger advises having your case manager and clinical documentation improvement (CDI) program perform a review early in the patient’s stay. Case manager reviews should be done using established review criteria. “Those [cases] that fail criteria a physician will look at and get the status, whether it’s outpatient, inpatient, or observation, as soon as possible,” he says.

One easy documentation mistake to spot is a variation between the plan of care and the patient notes, says Malm. Make sure these match. For example, if your plan of care is for a urinary tract infection, but your progress notes indicate a chest infection, the auditor will pounce on this. Be consistent.

As for your CDI program review, that should be performed shortly after the patient reaches the point of care. “Make sure that the documentation supports the provisional diagnosis, and make sure that’s followed all throughout the hospital stay,” adds Hopfensperger.

One area of focus should be what Greenspan refers to as “gray zone cases,” in which patients present with murky symptoms such as syncope, anemia, and chest pain, making it difficult to assign the correct status. These diagnoses can easily shift between inpatient and outpatient levels of care.

Denial maintenance

If a denial does slip through the cracks, decide whether it’s worth the appeal process. If you think you have a fighting chance, make sure you facilitate your appeal correctly and timely. Focus on the two key steps: peer-to-peer discussion and communicating your appeal thoroughly and clearly to the reviewer or auditor.

“Have a nurse or a doctor to review records to make sure the initial treatment is proper and to present a cogent argument, whether that’s peer-peer or a direct appeal,” says Greenspan.

See the sidebar on p. (x) for an example of how to take a case through the appeal process.

 

Hold peer-to-peer discussions when denials occur

When you get a concurrent denial, respond quickly, advises Hopfensperger. Have a peer-to-peer discussion with someone at the commercial insurance company, and make sure your physician advisor is looped in.

“If your own attending physician can’t take that call or doesn’t want to take that call—or, quite frankly, doesn’t have a very good track record with those calls—involve your physician advisor. Have them coach your physician, have them take the call for your physician,” he says.

Peer-to-peer discussions are invaluable when it comes to understanding a denial. “It’s an opportunity to have a conversation between the payer medical director and the treating physician to really understand why the case was denied, and it presents an opportunity to get the denial overturned before a formal peer review process,” says Greenspan.

 

Submit a clear claim with a defined plan of care

If you decide to go ahead with a direct appeal, make sure you have the right staff to do it. To increase the likelihood of your appeal being accepted, be as clear as possible when communicating the reason for your appeal.

“Unless you’re able to clearly articulate what you’re doing for a patient, it’s very hard for the payer to understand the need,” says Greenspan. “When someone outside your organization has to read the story, it can be confusing. Don’t leave anything out, and explain why you’re doing things.”

If your denial is due to a patient status change, explain the process to the payer. Articulate physician expectations, procedures performed, and procedure results, and explain how these factors led to the change in status.

When it comes time to submit your appeal, pay careful attention to formatting. Malm advises putting a summary sheet on the front telling the auditor where in the document to look for each item. “Paginate the record,” Malm says. “The auditors potentially may have difficulty locating the key supporting data in the hundreds of pages they receive.”

Ensuring the record is complete is also important, he adds. “Many fields on the EMR may not print as they are custom. Be sure to print and read the full record.”

Having a good relationship with your payer is always beneficial to some degree. Not only can it speed up the process, but it can sometimes make or break an appeal.

“Develop a relationship with your payer and medical director so they understand the medical record,” says Greenspan. “It creates credibility, trust, and makes the process quicker. Perhaps the payer will stop denying your claims if you keep pushing back.” Additionally, foster a good relationship with the audit community for the payer—the more they understand your records, the better the chance you have to avoid a denial, he says.

Looking ahead

When it comes to the future of denials, you must think about the root cause. Hospitals and payers both have large amounts of money at risk. Insurers are struggling to make the cost cheaper for employers by covering less, and hospitals are struggling to get reimbursement for the services they provide.

“It’s almost cyclical. Hospitals and payers need to be on the same page. Until there’s a willingness for insurers and providers to be on the same page, we’re just going to continue to see denials,” says Greenspan.

The amount of money at risk between front-end funds and funds to be reclaimed is going to increase the back-end cost, notes Hopfensperger.

“Hospitals are going to have to fund more, physician advisors are going to have to fund more for appeals, for letter writing, and also the retrospective appeals process,” he adds. “In the Medicare world, we see CMS directing the auditors now to become more and more aggressive: the QIOs, the RACs, and the MACs.”

Found in Categories: 
Denials and Appeals, Revenue Integrity