Maintaining a consistent cash flow is crucial for home health businesses dealing with challenges like Medicare payment cuts, regulatory changes, and shifts in the payer mix. A critical aspect of achieving this involves avoiding claim rejections, which can lead to further reimbursement problems, ultimately impeding your cash flow and impacting your bottom line. Taking proactive measures to tackle potential issues can help you avoid significant challenges down the line.
To gain a clearer understanding, let’s examine how rejected claims impact your time and finances:
- Lesser time to file: Various payers impose different timeframes for claim submissions. In case of claim rejection, the time available for corrective action and re-filing becomes even more limited.
2. Counterproductivity: Correcting and resubmitting claims consumes a significant amount of time to update information in the EHR system and deal with diverse payer requirements. This detracts from the time your team could allocate to delivering patient care.
3. Delayed reimbursement: The longer a rejected claim remains unresolved, the more time it takes for your agency to receive payment. This delay can disrupt the cash flow of your home health business.
4. Lingering issues: Rejected claims frequently indicate setup problems with the payer or flaws in your internal processes. If the underlying causes of these rejected claims are not identified and addressed, you will likely keep getting more rejected claims. This can lead to a cycle where you have to keep fixing and resubmitting claims.
Effective Strategies for Minimizing and Avoiding Claims Rejections
To cut down on claim rejections and keep your cash flow steady, consider these best practices:
- Fix rejections in 72 hours.
- Create well-defined procedures and designate process owners.
- Identify the reason for the claim rejection and address any underlying issues to prevent recurrence.
- Ensure proper payer setup and understand their billing requirements
- Work closely with your clearinghouse to enhance oversight and accountability.
- Aim for a low rejection rate—ideally under 3 percent.
Improving Coding to Prevent Claims Rejection
Examining the main causes of claims denials, as highlighted by MACs, reveals that numerous problems originate from coding mistakes or can be resolved by enhancing the coding procedure, including validating face-to-face encounter documentation.
Coders have a pivotal role in upholding precise and consistent details across all claim-related documents. Their responsibilities extend beyond assigning diagnosis codes, encompassing tasks such as intake, billing, and medical record review. This well-coordinated teamwork effectively averts claim denials and secures a steady cash flow for your home health business.