Medical coding and billing is the process where patient information is translated into readable codes and then billed to the relevant payment agency, such as an insurance company, Medicaid, or Medicare. In a straightforward case, all the patient information would be present and easy to read, the coder would take this information and find the relevant codes for each diagnosis and treatment, and then the biller would raise a claim and send it off for payment. The claim would be processed, and payment made. 

But according to the experts at Find-A-Code (https://www.findacode.com), not all claims for payment are straightforward. In fact, mistakes when it comes to finding diagnosis codes, missing information, or other errors can result in claims being rejected or completely denied. When this happens, payments are delayed at best or flat out rejected, costing the medical facility or causing patients to be out of pocket. 

Why Are Insurance Claims Rejected? 

In order to prevent claims from being rejected, it is important to understand the reasons why they are rejected in the first place. Knowing what types of mistakes will result in a claim being sent back will help you and your staff to ensure accuracy when filing. 

Failing to Get Pre-Authorization

A very common cause of a claim being sent back is a failure to get pre-authorization from the insurance company. This can be a tricky one because not all insurance companies require this, and those that do don’t require it for everything. It is important therefore that your medical coders and billers are up to speed with the policies and procedures for each insurance company when making claims. If you have medical billing software, you may be able to program it to flag up the various insurance companies and procedures that do require pre-authorization. 

Missing or Incorrect Information

Clerical errors can also result in delayed payments and claims being sent back for resubmission. It may be that information has been omitted from the claim or patient information has been misspelled. It could also be that a code has been copied down incorrectly with characters missing or digits reversed. Whatever the error, the insurance company will send the claim back for correction. It will then need to be resubmitted, which inevitably causes a delay in payment. It is vital therefore that coders and billers are drilled on the importance of accuracy when it comes to submitting insurance claims. 

Treatment is Deemed Unnecessary

In many cases, treatment that was provided may be classed as medically unnecessary by the insurance company and as such, payment will not be made. Again, different insurance companies will have different policies on which procedures they will cover. It is important that your staff know whether a specific insurance company will cover a certain medical treatment. It may be necessary for more paperwork to be submitted to provide evidence as to why the treatment was classed as necessary. Other times, the insurance company will simply refuse the payment. If this happens, it may be necessary to seek full payment from the patient or for the medical facility to absorb the cost. 

Late Claiming

Insurance companies often have deadlines for filing and if the claims are filed late the payment may be rejected. Some insurance companies will allow late filing provided more paperwork is filed, but others will accept a phone call to provide the reasons for missing the deadline. With different insurance companies having different policies relating to late filing, it is worth including this in billing software to alert staff of when a claim needs to be filed.