Lisa Rock, president and CEO of National Medical Billing Services, says that rejection of claims due to errors in the electronic submission process can be reduced by three simple practices.
Ms. Rock recommends that billing managers chart the path of electronic claim submissions for each payor. Electronic claims are sent from providers to the provider’s EDI company and, in some cases, on to several trading partners before the claim reaches the payor. The longer the path the claim takes, the more opportunity for errors. For example, an ASC may use an EDI company that does not have a direct contract with a certain payor. If that is the case, the EDI company would send the claim to a trading partner, which may or may not have a direct contract with the payor. If the trading partner does not have a direct contract, the claim would go to yet another trading partner before reaching the payor. Knowing the pathway of claims can also give billers a better idea of how long claims will take to reach payors, says Ms. Rock.
Billing managers can begin to chart the path by following a claim from the healthcare provider to the provider’s EDI company and then determine if the claim goes directly to the payor or to an additional clearing house or trading partner. “For each payor, call your EDI provider and ask if they have a direct contract with that payor. If they do not, ask where they send the claims next,” says Ms. Rock. “After you determine where it goes next, call there and ask if they have a direct contract with the payor, and so on.”
Ms. Rock recommends that in order to reduce the number of steps in these pathways, ASCs should seek out EDI companies that have direct contracting agreements with most, if not all, of the facility’s primary payors.
Ms. Rock also recommends the ASCs review all electronic claim rejection reports daily so that they can determine where in the pathway the claim was rejected. Reviewing reports will allow billers to determine if the cause for the rejection was in-house or with a certain clearinghouse and trading partner. For example, reviewing the report would allow a biller to see that a claim was rejected due to an error by the provider’s billing team rather than along the pathway. If errors are made along the pathway, reviewing the report will highlight where along the pathway the claim failed to move forward.
“Maybe a claim was rejected because of an ID error by your receptionist, but if you don’t read the rejection report, you don’t know that it was rejected out of the first stage. It didn’t even make it out of the gate,” says Ms. Rock.
If errors were indeed introduced by the provider’s staff, billing managers can take steps to improve processes and reduce in-house errors. If errors appear elsewhere along the pathway, billing managers should determine why the claims were rejected at that point and call the clearinghouse or trading partner to investigate further, if necessary.
Ms. Rock says that the most common rejections are for invalid subscriber ID numbers; missing subscriber date of birth if different from patient; invalid diagnosis code; and demographic errors, such as misspelled names.
Finally, Ms. Rock suggests that if providers notice several rejections at the same point along the pathway for a particular payor, they should actively investigate the issue.
“There was one instance where there was a problem between our clearinghouse and a trading partner, and our claims weren’t getting to the trading partner,” says Ms. Rock. “We received confirmation that they were received by the EDI company, so we assumed they were going through. There ended up being a glitch in their system that was holding up our claims.”
Ms. Rock says that without regularly reviewing rejection reports, the provider would not have been aware of the error in a timely manner as the clearinghouse did not contact the provider. By being aware of errors and actively investigating them, providers help to ensure that their claims reach payors in a timely and can take steps to change pathways or claims processes if errors continually occur.
Ref. Becker’s Healthcare
This post was first published October 5, 2009 and was updated July 29, 2020.