While medical practices strive for quality patient care, a small mistake with billing can turn into a big financial issue. Issues with patient information, coding, missed authorizations, and claim submission errors can cause delayed payments, claim denials, high accounts receivable, and unneeded administrative work.
However, these medical billing mistakes can be avoided if there are standard billing methods and adequate checks established in medical practice. The first step in safeguarding your practice’s revenue cycle is to identify the areas where the errors occur.
We will explore 15 common medical billing errors, discuss the reasons behind their occurrence, and offer strategies for reducing medical billing claim and error rates.
What Medical Billing Errors are?
Medical billing errors refer to any inaccuracies or mistakes that take place during patient enrollment, insurance verification, coding, claim preparation, claim submission, payment posting, or follow-up.
There are many ways that a mistake can have a major impact on the revenue cycle. For instance, if the patient’s ID is entered incorrectly, the claim will be denied and if the CPT or ICD-10-CM code is entered incorrectly, the claim may be denied or denied for the incorrect code.
It’s not just about submitting more claims. It’s to file claims that are accurate, complete, and well-supported and can be efficiently acted upon by insurance companies.
1. Incorrect Patient Information
Patient demographics plays an important role in the billing process. A payer may not be able to match a claim to the patient’s member record when there are errors in the patient’s name, date of birth, address, insurance ID or other identifying information.
How to prevent it
Check demography and insurance details at enrolment and where applicable, at the time of return. When appropriate, staff should use patient’s insurance documentation and the patient’s payer records to compare the information.
3. Not Conducting a Risk Assessment of the Contractor
Having insurance doesn’t always mean all services are covered.
If eligibility is not verified, claims can be filed with inactive insurance plans, or for services that are not covered by the patient’s benefits.
Eligibility checks can be used to verify critical eligibility data before services are rendered, such as coverage and payer information.
3. Incorrect CPT Codes
Many medical services and procedures are reported on professional claims and are described by a CPT code. If you enter the wrong code, you may end up with a claim issue or an inaccurate billing.
It is important for coding teams to carefully review the documentation and ensure the reported service corresponds with the clinical documentation and coding requirements.
4. Using Incorrect ICD-10-CM Codes
Diagnosis coding is an essential part of the coding that gives valuable details about patient’s condition and the service’s intent.
If a claim contains an incorrect or unsupported ICD-10-CM code, then a claim may be subject to a payer’s medical necessity and/or accuracy audit.
Good documentation and coding scrutiny are key to preventing these billing mistakes.
5. Modifiers missing or incorrect.
Modifiers may be used to further describe the way a service was rendered/reported. Incorrect use of a modifier, failure to use a required modifier or use of the wrong modifier may impact claim processing.
Modifier requirements are dependent on the service, payer, and circumstances so coding staff should always code in accordance with current applicable coding guidance and the applicable payers’ requirements.
7. No Prior Authorization Obtained
Prior authorization may be required for some services to be performed.
A claim can be denied even if a patient is covered, if there is no authorization.
Practices should reinforce the need for services that may need to be authorized and agree on a process for checking requirements prior to scheduling or providing the service.
7. Submitting Claims to the Wrong Payer
Patients might be covered by several insurance plans and it is crucial to identify the right primary payer.
It can cause unnecessary delays and extra administration if you submit a claim to the wrong insurance company. In the case of more than one insurance policy, staff should check the insurance details and arrange benefits accordingly.
8. Information on Claims not provided.
Claim errors come in various forms, one of which is incomplete claims.
The claim might lack demographic data, provider data, diagnosis codes, procedure codes, authorization information, or other necessary information.
Practices should implement a consistent claim review mechanism before submission to ensure that claims have all the necessary and appropriate information or address inconsistencies.
9. Duplicate Claim Submission
Duplication of claims can lead to confusion on the part of the payer and may also cause extra workload in the billing department.
This may occur when multiple employees submit the same claim without communicating with one another or when employees contact the claimant and submit the claim again without realizing that it has been already been submitted.
Having a solid claim tracking system can help the employee decide if a claim is pending, rejected, denied or has been processed before taking any further action.
The Place of Service is incorrect.
10. Wrong Place of Service.
Place of service code indicates the location of healthcare services.
Each of these can result in a discrepancy between the claim, the medical documentation and what is reported as the service. It is important for billing/coding teams to ensure that the place of service reflects the encounter.
11. Not following Payer-Specific Requirements
Each Medicare, Medicaid, and commercial insurance plan may have various claim and billing specifications.
The process of billing can be different for different payers. Practices should keep up-to-date information about payers and perform a check of applicable requirements prior to claims submission.
This is particularly important when it comes to services where authorization, documentation, coding or specific rules for claim submission are involved.
12. Poor Payment Posting
Payment posting is a crucial step of the revenue cycle. Posting insurance payments, adjustments, contractual amounts or patient responsibility incorrectly can cause inaccurate balances.
Bad payments posting may also increase the difficulty of identifying underpayments, payables due, and accounts that need to be followed up.
Payment posting will provide the practice with a good picture of their financial situation if it is done promptly and properly.
Not following up on accounts receivable.
Submitting a clean claim is just one component to the billing process. Practices also should keep an eye on unpaid claim and outstanding accounts receivable (AR).
If unpaid claims are not addressed for an extended period of time, payment delay can occur, which could make it more challenging to settle older claims.
By conducting regular AR follow-up, billing teams can be able to identify unpaid claims, understand why payments have not been received and take appropriate action.
14. Failure to correct denied or rejected claims.
Do not dismiss a rejected or denied claim without consideration.
If a claim has been rejected, it needs to be corrected and reclaimed and if the claim has been denied, it requires an investigation, further documentation, reconsideration or appeal, depending on the situation.
Denial management is all about finding out what caused the issue and fixing the underlying cause, to prevent re-occurrence of similar problems.
15. Poor Documentation & Billing Review
The key to accurate billing is to have accurate documentation.
If there is insufficient or inadequate documentation to support the services a practice has reported on a claim, then the practice can have documentation reimbursement issues or other claim issues.
Submitting claims to the doctor’s office can be a routine task, but if you notice patterns in your coding, documentation, eligibility, or authorization, it may be worth implementing an internal review process to identify them early and avoid them becoming recurring issues.
So why are medical billing errors hurting practices’ revenue?
Billing errors don’t cost just one uncompromising claim.
Common consequences include:
Delayed reimbursement
Educate on the process of claiming and denials
Increased accounts receivable
Additional staff workload
Increased claim correction time
Delayed patient billing
Finding error in payments, which is often confusing
Sloppy workflow in the revenue cycle
The time that can be taken by constantly correcting preventable errors can be significant for a medical practice with a heavy workload.
The answer doesn’t have to be more labour intensive. A better solution is to figure out where mistakes are made and put in place processes that will ensure those errors don’t happen again.
What are the ways to minimize the medical billing mistakes in the medical practices?
Instead of just fixing claims, a better approach to reducing medical billing errors is to work on the revenue cycle overall.
1. Verify Information Early
Verify patient information, insurance coverage and eligibility before rendering services as much as possible.
2. Strengthen Coding Accuracy
Ensure that coding is done on documentation and relevant coding requirements. By conducting regular coding reviews, you can discover common problems.
3. Monitor Authorizations
Develop a straightforward process for identifying services that need prior authorization and verifying authorization prior to the service.
Before you submit a claim, check the details first.
The pre-submission review can reveal inconsistencies in data, coding issues, missing information, and any other potential claim issues.
5. Track Denials
Avoid attributing each rejection to “just a bad day.Try to avoid dismissing each rejection as “just a bad day. Collaborate on denial statements and see if there are common patterns. If an issue consistently is impacting claims, talk about the process that is the issue.
Ensure that Consistent AR Follow-Up is carried out.Carry out Consistent AR Follow-Up (6).
Track unpaid balances by age and Payer. Follow-up can occur in a timely fashion, assisting the practice in identifying accounts which require action.
7. Keep Billing Staff Informed
Charges may vary. Teams need to be aware of payer, coding and claim submission requirements.
When to seek out professional billing support for a practice?
If your internal team is dedicating a lot of time to claiming, researching denials, verifying insurance, posting payments, or following up on aging AR, consider looking into medical billing services.
An RCM partner who has experience can help with medical billing, medical coding, claims management, insurance verification, eligibility verification, denial management, AR follow up and payment posting.
Noventra RCM offers medical billing and RCM services to medical practices and healthcare providers. With the right support, practices can have more uniform billing processes and leave internal staff more time for practice operations and patient care.
How Noventra RCM can help your revenue cycle?How Noventra RCM can help your revenue cycle is answer to the question.
There are several points in the revenue cycle that need to be addressed to avoid billing issues. Eligibility and coding problems can manifest themselves later as claim denials or delayed payment or AR aging.
Novenetra RCM can assist with the relevant aspects of the billing process, such as medical billing, claims management, medical coding, eligibility verification, denial management, AR follow-up, and payment posting.
When your practice is facing regular billing issues or an excessively time-consuming billing procedure, expert RCM support could be a sensible remedy to fortify the method.
Final Takeaway
Medical billing mistakes can impact a lot more than simply a claim. Medical practice revenue cycle issues such as incorrect patient information, eligibility problems, coding errors, missing authorizations, incomplete claims, payment posting problems, and poor AR follow-up can all put undue strain on a practice’s AR process.
The key is to be proactive. Check information early, review claims thoroughly, keep track of denials, keep accurate coding documentation and follow up on outstanding balances on a consistent basis.
If this is the case and billing is taking too much time away from your practice, Noventra RCM can offer you medical billing and RCM services that are specially designed to your particular revenue cycle requirements. With a sound billing process, your staff will be able to spend more time on running your practice and less on unnecessary administrative issues.