Denial management in hospital medical billing is one of the top issues that in-house billing and coding teams face in the American healthcare industry. According to reports from leading health data firms, CMS 8% Medicare claims on average every year. That being said, 500 million paper claims every year, according to the AAPC. There have been instances where CMS rejected 41 million claims in a single day. Navigating through the claim submission process can be pretty challenging for even a highly experienced hospital billing professional. However, experts know how to keep the revenue flow strong by keeping themselves updated at all times.

Analyzing the errors and the reasons for denial is the best practice for any medical billing company or in-house billing team. The data reports give you detailed insights into what went wrong that you should not repeat in subsequent times. Since Medicare claims form a more significant part of the submitted claims, you must monitor the repetitive errors in those claims. The CMS has identified the codes that face a significantly higher rate of denials than others due to a wide range of reasons. Please make sure you and your teams are familiar with these issues to tackle them with ease.

Insert CERT in your Hospital Medical Billing Workflow

Specifically designed for the CMS’s Medicare Fee-For-Service (FFS) Program, the CERT program stands for Comprehensive Error Rate Testing. The CERT program monitors the overall accuracy of claim payment in the FFS program and flags the improper payment amounts. The program scans the claims to find any claim that should have been denied or received a partial payment.

The CERT program takes the flagged claims into account and puts them under one or more of the following categories:

  • Medical Necessity
  • No Documentation
  • Improper Documentation
  • Wrong Coding
  • Other reasons

The CERT program flags the claims because they did not meet the stipulated Medicare requirements. They do not fall under the bracket of fraud payments.

Top Error-prone MS-DRGs as per CERT

The CERT program scans the different claims under several categories. One of the most common categories is the Medicare Severity-Diagnosis Related Groups (MS-DRGs). The CERT publishes updated tables on the most frequently erred MS-DRGs and assigns the primary and secondary error types.

The top 20 error-prone MS-DRGs as flagged by the CERT are:

  • 469, 470
  • 885
  • 871, 872
  • 266, 267
  • 459, 460
  • 291, 292, 293
  • 884
  • 056, 057
  • 391, 392
  • 308, 309, 310
  • 515, 516, 517
  • 313
  • 689, 690
  • 471, 472, 473
  • 981, 982, 983
  • 273, 274
  • 492, 493, 494
  • 947, 948
  • 100, 101
  • 223, 227

16 out of 20 MS-DRGs were flagged under the Medical Necessity error type. 3 out of 20 were put under Insufficient Documentation, and one was due to Incorrect Coding.

These data analysis results could prove extremely valuable for the hospital medical billing teams. Experts advise that you should go through these reports to understand where your denials stand. If the denial analysis of your organization resonates with the ones highlighted by the CERT, you need to start working on the error types.

As evident from the analysis above, medical necessity is one of the top reasons for denials. The CERT uses Medicare coverage and payment criteria as the primary contributors to determine the medical necessity error type.

Medical Necessity: Lack of Supporting Documents

The most critical point of contention between healthcare organizations and insurance companies is the medical necessity of a particular procedure. Medical necessity typically creates confusion regarding prior authorization in regular cases. However, according to CERT, medical necessity error type does not usually mean that a procedure is unnecessary. As a provider organization, you need to provide good papers and documents to support your diagnosis and the reason for a specific medical practice.

Here are some of the frequent issues that come up with medical necessity error type:

  • Lack of historical medical data
  • Incomplete documentation of conservative treatments
  • Lack of reports and diagnostic tests to support that the medical procedure is required
  • Vague statements without explicitly pointing out details of conservative treatment before surgical intervention
  • Jumbled sequencing of diagnosis codes leading to lack of clarity on the process

Much reimbursement acceptance depends on the medical coverage mentioned under the Medicare contract. However, you can still contest a denial based on the following facts:

  • The procedure is entirely safe and proven effective in other similar cases.
  • It would be best if you answered whether the procedure was experimental. You could investigate the matter with a new approach that you believe will improve the patient’s care plan. You need to back up your claims with sufficient resources from reputed standard journals.
  • A qualified healthcare provider should order the tests, and they need to monitor it thoroughly in the entire plan.

Do not forget to include all physician consultation reports and their progress reports to ensure that Medicare has the whole picture of the treatment process. Many times the issue might be a clerical error. For example, you could have all the necessary documents needed to accept the claim. However, due to the manual handling of a large volume of claims every day, the understaffed billing team might miss out on submitting them.

Common Coding Errors

Medicare reports show that a large section of the claims faces rejection every year due to incorrect coding practices. The standard errors are:

  • Mismatch of code on the bill with the one referring to the actual medical procedure performed
  • Unbundling of codes
  • A different provider performed the procedure while another was billed
  • Improper sequencing of codes

Try to incorporate AI tools in your daily workflow to make sure that you eliminate most of these errors. Manual intervention is necessary even in the presence of most tools, but you can use your resources wisely elsewhere. Follow the best practices in hospital medical billing to ensure your revenue flow is strong.

We hope this article helped you understand the top Medicare error rates in hospital medical billing that could hinder your revenue cycle management. Please connect with us in the comment section below in case of any queries. Subscribe to our blog for regular articles on the medical billing industry. Follow us on Facebook, Instagram, Twitter, and LinkedIn for more.