Best Practices to Reduce Claim Denials

In the ever-evolving world of healthcare, providers face numerous challenges in securing their revenue, but few are quite as challenging as claim denials. As we cover in Reverse Engineering Denials Management, 18–20% of claims are denied, and 65% of those denied claims are never reworked.

Fortunately, studies have shown that up to 90% of denials are preventable. While we have numerous articles dedicated to the details of denials management, there are general best practices for reducing denials that are actionable, effective, and can help you receive the compensation that you deserve. 

Streamline Registration

As the goal of denial management is to reduce the number of denials, it has to start with the originating point of medical services—registration. Here are some key registration best practices to consider:


Offer patients the option of pre-registration by sending them a packet with a return envelope before their appointment. This practice allows you to verify insurance coverage and obtain necessary information ahead of time, minimizing the risk of denied claims after the services have been rendered.

Correct Demographics

The collection of accurate patient demographics that are vital for payment, such as photo ID and address verification, is an important practice. Gathering this information upfront reduces the chances of errors and helps maintain a smooth claims process.

Insurance Verification

If the patient cannot verify coverage before the appointment, consider rescheduling.  Additionally, if a patient requires a referral but does not have one or cannot obtain it, rescheduling may also be in order.

Acknowledgment of Payment Responsibility

To minimize disputes over payment, ask patients to sign an acknowledgment stating that they may be responsible for payment if their insurance does not cover the services provided. This practice ensures transparency and helps address potential financial issues early on.


Claims Tracking and Documentation

Tracking and documenting claims is essential for effective denial management. Best practices center on monitoring each claim and identifying the reasons for denials as a proactive measure to prevent future denials.

Timely Submission and Appeals

Ensure that claims are submitted promptly and appeals are filed within the designated timeframes. Procrastination can lead to missed opportunities for reimbursement and potential claim denials. Implementing a systematic practice for claims submission and appeals helps maintain a well-managed revenue cycle.

File Claims on Time

Late submissions typically result from human error and time constraints. While there are a number of practice management software suites with claims tracking, submission, and automation features, there are also organic solutions that can be easily implemented, such as setting internal deadlines and choosing electronic claim submissions over paper-based methods whenever possible.

Detailed Reporting

Regularly run detailed reports of your practice’s denied claims. These reports can help pinpoint specific claims without sifting through multiple ones, saving time and effort. Analyzing the data from these reports allows you to identify trends in denials and take corrective actions swiftly.

Automated Claims Management Solutions

Consider investing in an automated claims management solution to streamline the entire claims tracking and documentation process. These solutions are regularly updated with codes, offer decision support, and can efficiently route denied claims directly into worklists. By replacing paper-based processes with automated solutions, you can reduce the possibility of inaccuracies and ineligibility, enhancing overall efficiency.


Staff Education and Training

Continuous education and training for your staff is crucial to staying ahead of changing regulations and payer requirements. Best practices for training and education can help your team become more effective at avoiding denied claims and growing your revenue over time.

Assemble the Team You Really Need

Leverage resources from different departments or even outside experts (like Medical Practice Success) to form a cohesive team responsible for tracking and reporting developments, identifying root causes of denials, and implementing healthcare revenue cycle management (RCM) solutions.

Be Proactive About Payer Requirements

Allocate staff members to regularly monitor payer websites and portals for any updates. Subscribing to payer newsletters and participating in webinars or training sessions sponsored by payers can also assist in staying current with evolving requirements.

Create a Culture of Continuous Improvement

Establish a cycle of analysis, feedback, and education, so your team leverages the insights gained from analyzing and reducing denials. This will help identify what works and what does not while acknowledging and encouraging the success of individual team members.

Effective Communication and Collaboration

Open lines of communication between the billing department, front office staff, and providers are essential for successful claims management. Encourage collaboration and ensure that everyone involved understands their roles and responsibilities. By fostering effective communication and teamwork, you can proactively address potential issues before they lead to claim denials.


Enhance Crucial Billing Processes

While the end goal is to develop a highly refined denials management strategy, applying best practices to some key aspects of the billing process is a great place to start.

Perform Regular Denials Management Audits

Conduct regular claims denials reviews to evaluate the effectiveness of your strategies and identify areas for improvement. Monitor key performance indicators such as denial rates, average days in accounts receivable, and revenue cycle efficiency.

Implement Robust Documentation Practices

Conduct regular claims denials reviews to evaluate the effectiveness of your strategies and identify areas for improvement. Monitor key performance indicators such as denial rates, average days in accounts receivable, and revenue cycle efficiency.

Perform Regular Denials Management Audits

Accurate and detailed documentation is essential to support claims submissions and appeals, particularly for denials related to inadequate supporting information. Ensure that all relevant medical records, test results, and other necessary documentation are complete and easily accessible.

Utilize Technology and Analytics

Leverage technology and data analytics tools to gain insights into your claims management process. Implementing advanced analytics solutions can help identify trends, predict potential denials, and optimize your revenue cycle. By harnessing the power of technology, you can proactively address issues and minimize the impact of claim denials on your organization’s financial health.

Develop a Denial Resolution Process

Establish a structured denial resolution process within your organization. This process should include clear steps for addressing denied claims, including thorough analysis, necessary corrections, and timely resubmission or appeals procedures.


Best Practices Build a Foundation for Denial Management

Reducing claims denials is a critical objective for healthcare providers aiming to optimize their revenue cycle. By implementing our best practices, healthcare providers can immediately begin to build the foundation of a denial management strategy that protects revenue and improves financial health. 

If you’d like help reducing your denied claims, or have tried to implement similar practices but did not achieve the results you wanted, contact Medical Practice Success today.

As a leading revenue cycle management vendor and solutions provider, we get to the root cause of your claim denials and ensure that you receive the compensation you deserve.