What Is a Clean Claim Management in Medical Billing on a Budget?

As a healthcare provider, your revenue cycle is dependent on the number of claims cleared and reimbursements from the medical insurance companies. To get an early reimbursement from the insurance companies you need to submit a clean claim. In fact submission of a “clean claim” is the main constituent of economically successful Healthcare practices. Hence, clean claims management is mandatory to run your medical business successfully.

What is the clean claims?

A clean claim is errorless “submission of documentation” to the insurance company as soon as medical services are rendered. A clean claim requires accurately filled forms, clear and accurate documentation, proper coding mentioned in medical bills, or additional documentation.

The economic impact of Clean claims on Healthcare providers or healthcare institutes.

Cleared claims are the main source of revenue for a healthcare provider or healthcare institute. An early reimbursement needs clean and errorless submissions of the claim. Some claims are denied or rejected, submitted again. Resubmission is a time and money-consuming element.

Multiple Inaccurate claims may lead to legal issues. US Department of Justice has enforced the law of the “False Claim Act” and “Anti-Kick-Back Statue” to cater to the problems of over-billing and coding abuse. To avoid these legal allegations or threats you should concentrate on claims management.

How to calculate the clean claim rate?

A claim rejection rate from 5% to 10 % is satisfactory. The claim rejection rate below 5% shows a healthy revenue cycle of the individual or company.

According to the Medical Group management association (MGMA), the healthcare providers are underpaid from 7% to 11%. Whereas it is estimated that every claim reprocessing eats up $25 and a lot of mental exercises. According to the Healthcare billing and management association, around 30% of claims are denied, 60% of claims remain ignored or never resubmitted.

Elements of a clean claims.

Information of Healthcare practitioner and patient.

A claim form has the details information of the medical practitioner (like name, Identification number, mailing address, etc) and the patient (Name, Identification number, contact, and mailing address information).  

To achieve the goal of 95% clean claims, you need an updated record of patient information.

Valid License and credentialing of a Healthcare provider

The main element of a clean claim is a valid license of the healthcare provider. There should be no involvement in any fraud or investigation. He should have gone through the proper credentialing process.

Date and Place of the treatment

Mention the accurate date and place at which the healthcare services are provided.

CMS 1500

Claim forms for submission of claims are formatted by centers of Medicaid and Medicare service. Every claim is submitted on the prescribed form (CMS 1500), submitted with reports, etc. CMS 1500 form is available on the National Uniform Claim committee NUCC website.

Proper Coding

The proper coding according to the diagnosis and prescription is an important element in clean claims management. Codes mentioned according to the prescribed set of codes like CPT or ICD-10-CM.

If your coding staff is not well trained the problem of upcoding, down coding or improper information will remain undetected till claim submission or even after denial. Ensuring accurate coding will help you in early reimbursements.  

Insurance Coverage

You should confirm that patient’s insurance is covering the services rendered, before submission of the claim. The reason for denials include the submission of a claim mentioning the services that are not cover by the insurance plan of the patient.

Necessary additional documentation

Some medical procedures like surgeries, dialysis, etc need prior authorization from the patients. This authorization attach as an additional but necessary document.

How to reduce the claim denial rate.

Take-charge: Be proactive

Simple errors like wrongly entered national identity card number, Insurance ID number, date of birth, demographic location, etc. These minor mistakes are the major reasons for maximum denials.

Confirming the patient’s data before submission of the claim can reduce the chances of denials. You can use automated systems to collect, save and verify the required health record.

Mechanize everything.

Manual record-keeping and fillings of forms increase the risk of error filling.

Automated outsourced or in-house systematic billing records can decrease the risk of wrong entry or erroneous form fillings.

According to a survey, around one-third of healthcare practitioners use manual record and filling processes. In return, their claim denial rate is also high. Those who switched to automated systems have a low percentage of denial cases.

Adjust the healthcare practices with Medical Billing Guidelines

You should adjust your healthcare practices with medical billing company guidelines. In some cases, medical bills decline due to conflict that either the procedure was necessary or not. On the other hand, the documentation of billing is not complete enough to support the necessity of the medical procedure. To minimize the number of cases denied because of this reason may require the following important points.

• One should validate from the payer regarding the necessity of the procedure. Procedure cost should also be communicate to the patient. If he is willing to pay then you should conduct the procedure.
• Conduct healthcare reviews accordingly and regularly. In case of hospitalization a revision is need after each second day.
• Thorough documentation of levels of care and decision is need.
• The medical practitioners should know how the clinical documentation affects the billing processes.  

Submission of a claim

Claims can be submit through paperwork or electronically. A claim with no ambiguities, providing accurate data on a prescribed form, and at the proper time has more chances of acceptance. The more you are careful at the time of claim submission will reduce the chances of denials.

Work on denials regularly

Try to submit a clean claim but if due to any reason the claims are denied. You should work again on these cases and resubmit the claim.

Working on denials on daily basis helps process the denial cases on time. An on-time resubmission can reduce the cost of reprocessing.

Identify the cause

Identifying the cause of denials. Reprocessing the bills becomes easy and fast when the cause of denials is identified on time then Delayed claim resubmissions can cause rejection of these claims.

The audit is compulsory.

An audit is a compulsory element of claims management. Audit your claims before submission to the insurance company can reduce the chances of denial.

An audit is need In case of resubmission to identify the causes of denied cases. A proper audit in both times helps identify and rectify errors.

The solution to the problem

High Costs are also incurred in hiring and managing an in-house team of experts. The solution to this problem is outsourcing a billing company with the complete set of services should be hired to provide you denial management solutions. Complete set of services include, coding, billing, revenue cycle management, claims management.

Claims management requires the expertise of coding and proper billing. A person without proper knowledge of coding may enter the wrong or aforementioned medical codes. The erroneous codes will lead to denied cases. Secondly, every healthcare provider can’t hire and manage a team of coders and billers.