Medical billing is a frustrating process for counsellors who are often juggling too many business tasks, as well as trying to provide excellent clinical care. In fact, many counselling practices collect less than 85% of the monies that they’re rightly owed from insurance companies. However, with good planning, and a smart billing staff (in house or otherwise), your practice can reasonably expect to collect between 96-99% of claims.
Insurance claim denials can be very inconvenient for patients and can affect a practice’s ability to receive payment for services rendered. Preventing insurance claim denials before they ever occur can help your practice to more efficiently receive moneys earned and to keep a better relationship with patients. Patients will be more likely to stay loyal to your office when their claims are routinely paid as expected. In order to prevent claim denials, it is best to understand some of the common reasons for them.
There are many reasons that claims can go unpaid, including:
Insurance Company Lost the Claim, and then the Claim Expired: Sometimes insurance companies misplace claims. If a misplaced claim doesn’t make it into the insurance company’s system before the deadline, the claim will be denied. Frustrated providers might find themselves talking to someone from the insurance company who says, “even though the error might have been on our end, there’s nothing we can do. The time frame for filing has expired.”
Submitting Duplicate Claims: If a duplicate claim is filed before an insurance company has responded to the first claim, it may result in a claim denial. Multiple employees may also submit a claim if there is not an established procedure in place for claim filing. Having a system in place with claims tracking can help to avoid this common error.
You Provided Two Services in One Day: With behavioural health, insurance companies have a strict “one service per day” policy. This means that even if a patient is authorised for 12 sessions of therapy, if you provide two sessions in one day, you won’t be paid for the second session. Clinicians who provide group therapy, psychological testing, or medication reviews beware—sometimes these services also fall under the one service per day policy.
Incorrect Coding: ICD-10 has a lot of advantages over previous coding systems used for medical billing, but the volume of codes can get confusing. Implementing high quality medical billing software can help to ensure correct coding. Most systems will flag potential errors before allowing you to send claims, which may be very helpful in preventing denied claims.
Waited too Long to File the Claim: The vast majority of insurance companies allow 90 days from the time of service to file a claim. However, some insurance companies allow only 30 days to file (and a very few, such as Medicare, allow a year—wow). When claims are filed too long after the date of service, they are rejected.
Lack of proper authorisation: Insurance companies often require the patient to obtain preauthorization of services before treatment, especially for non-routine services like hospitalisations, surgeries and behavioural care. If you provide services without the proper authorization, the claim will likely be denied. To prevent this from happening, you can obtain pre-authorization from the insurance company on the patient’s behalf.
A pre-existing condition: Many insurance plans have a pre-existing condition exclusion clause. If they discover a claim has been submitted for treatment of a condition that existed before the insurance policy began, they will reject the claim. They might even deny a claim for a separate, new illness, if any other kind of pre-existing condition was not initially disclosed. This is usually because the insurance company would not have offered coverage in the first place if the patient had disclosed the pre-existing condition in the beginning.