Blog

Reducing Claim Denials Through Effective Eligibility Verification

Claim denials remain one of the most costly and persistent challenges in healthcare revenue cycle management. These denials lead to delayed income, wasted administrative time, and frustrations among both patients and staff.  Inaccurate verification can result in rework, appeals, and ultimately, lost revenue. By addressing this issue upfront, healthcare providers can protect their revenue and improve the patient experience. Reducing claim denials through effective eligibility verification is essential to ensure smoother operations. This article will explore how effective eligibility verification can reduce claim denials, the costs of inadequate verification, and best practices for implementing a robust eligibility verification process.

Key Takeaways

• Eligibility Verification’s Role: It serves as the first line of defense against avoidable denials and ensures appropriate compensation.

• Financial Impact: Failing to verify eligibility accurately can lead to revenue loss, increased administrative costs, and patient dissatisfaction.

• Best Practices: Timely and thorough verification, leveraging technology, and transparent financial counseling can drastically reduce denials and improve patient relations.

  

Conversation Between Dr. Smith and Dr. Joe

Dr. Smith:
“Joe, we’ve been seeing a lot of claim denials recently. The financial stress it’s causing is overwhelming. What do you think is going wrong?”

Dr. Joe:
“Smith, I think a lot of it comes down to eligibility and benefits verification. We’re relying on old data, and our process isn’t proactive enough. When eligibility isn’t verified early, we’re already behind the eight ball.”

Dr. Smith:
“You’re right. If we could get this right up front, I bet we’d see fewer denials and less frustration for everyone involved. We need to look at how we can verify eligibility more effectively and prevent this from becoming a regular issue.”

Dr. Joe:
“Exactly. We need a more streamlined approach—one that’s efficient and technology-driven. This isn’t just about avoiding denials, it’s about providing a better experience for our patients too.”

Why These Issues Happened

There are several reasons why eligibility verification is often insufficient, leading to claims being denied:

1. Complex Insurance Plans: Insurance plans come with varied benefits, rules, and verification processes, making it difficult for staff to ensure they’re covering all aspects.

2. Outdated Patient Data: Patients frequently provide incorrect or outdated insurance information, which can lead to issues when submitting claims.

3. Manual Processes: Relying on manual checks or phone calls to insurance companies can result in human error, inefficiency, and delayed verification.

4. Limited Understanding of Plan Details: Navigating the nuances of coverage levels, exclusions, and authorizations often causes errors during verification.

5. Timeliness: Verifying eligibility too early or too late can lead to missing key information needed to prevent denials.

Solution/Action Taken

To address these issues, Dr. Smith and Dr. Joe decided to revamp their eligibility verification processes by implementing the following steps:

1. Pre-Registration and Early Verification:
   Eligibility verification was moved to the pre-registration stage to catch any potential issues early. For new and complex cases, verification was done 48-72 hours before the scheduled service to ensure ample time for adjustments.

2. Comprehensive Data Collection:
   The team began collecting complete patient and insurance information, including both primary and secondary insurance details, policy IDs, and group IDs. This data was stored securely and used for subsequent verifications.

3. Technology Integration:
   Dr. Joe introduced automated eligibility verification tools that integrated directly with their Electronic Health Records (EHR) and Practice Management (PM) system. These tools could perform real-time eligibility checks, reducing the reliance on manual processes and improving accuracy.

4. Transparent Financial Counseling:
   Once eligibility was confirmed, the team provided patients with an upfront estimate of their financial responsibility. This was communicated clearly, and payment plans or financial assistance options were discussed to avoid billing surprises.

5. Staff Training:
   Regular training was provided to staff on the importance of accurate data collection, recognizing the specific requirements for each type of insurance, and using new technology to streamline the verification process.

📈 The Results: Clinic Performance After 3 Months

After implementing these changes, the clinic saw remarkable improvements:

• Dramatic Reduction in Denials: Claim denials dropped by 35%, largely due to earlier identification of eligibility issues and improved accuracy.

• Improved Cash Flow: With reduced denials, the clinic saw a 20% improvement in cash flow as claims were processed faster and payments were collected sooner.

• Better Patient Experience: Patient satisfaction increased due to clear financial counseling, reducing confusion and improving trust in the billing process.

• Lower Administrative Costs: By automating the eligibility verification process, the clinic reduced the time spent on manual follow-up, leading to a 15% reduction in administrative costs.

What Did We Learn?

The key takeaway from this process is that proactive eligibility verification is essential to reducing claim denials. By addressing potential issues before services are rendered, healthcare providers can prevent administrative burdens, improve cash flow, and ensure patients have a transparent financial experience.

What People Are Asking?

How soon before the service date should eligibility be verified?
Eligibility should be verified as soon as an appointment is made, ideally 48-72 hours prior to service to allow enough time to resolve any issues.

Can technology really reduce denials?
Yes, real-time eligibility verification tools, automated benefits verification, and integrated systems significantly reduce human error and ensure accurate, timely verification.

What happens if a patient’s coverage is inactive at the time of service?
If coverage is found to be inactive, the patient can be informed ahead of time, and alternate payment arrangements can be made, preventing surprises at the time of service.

Disclaimer

For informational purposes only; not applicable to specific situations.

For tailored support and professional services,

Please contact Staffingly, Inc. at (800) 489-5877

Email : support@staffingly.com.

About This Blog : This Blog is brought to you by Staffingly, Inc., a trusted name in healthcare outsourcing. The team of skilled healthcare specialists and content creators is dedicated to improving the quality and efficiency of healthcare services. The team passionate about sharing knowledge through insightful articles, blogs, and other educational resources.