3 Reasons Why a Local Health Department’s Insurance Claims May be Denied
By SMART Health Claims
Most claims are denied due to provider or patient error and with a few quick fixes, you can resubmit those claims and make sure the same mistakes are never made again.
The Affordable Care Act has made it easier for people to get insurance, and in turn, made it possible for local health departments to submit more reimbursable claims. As your local health department begins to expand its billing program, you may notice an increase in claims being denied by insurance companies. Don’t give up on that claim just yet. Most claims are denied due to provider or patient error. With a few quick fixes, you can resubmit those claims and make sure the same mistakes are never made again.
Here are the three most common reasons a claim will be denied. Each reason can be quickly remedied so that your local health department can continue billing with confidence.
#1 Reason Claims are Denied - Subscriber not eligible at the time of service
Verify that you have billed the correct insurance for that DOS (date of service), per the demographic information received from the patient. If you were correct in billing the right insurance company, your next step should be to gather as much info from them as possible. What is the termination date? Do they happen to know who the current plan is with? You should update your patient files with the information you gather, and then attempt to contact the patient. Explain to the patient that ABC Insurance Company has denied their claim for ‘lack of coverage at the time of service’, and ask them if they have had a recent change in coverage.
Typically, the patient may have given an outdated card at the time of service, and all that is needed is to re-bill the claim to the correct insurer. If the patient did not have active coverage at the time of service, this balance would then be flipped to patient responsibility, and payment arrangements should be discussed.
#2 Reason Claims are Denied - Coordination of Benefits/Primary EOB needed
If a patient has a primary and a secondary payer, the secondary payer will deny the claim if submitted without primary EOB information. With electronic data interchange, often this primary carrier info can be attached to the claim electronically. If this is not an option for the payer, you will need to manually attach the primary EOB to a paper claim and re-bill it to the secondary.
However, there is an exception to this rule, and that is a VFC eligible dual-covered patient. These are the patients with a primary commercial carrier and a Medicaid payer/product as the secondary payer. VFC Operations allows VFC providers to bypass the commercial primary payer, and bill directly to the secondary Medicaid payer (if they choose; this is optional). A VFC provider might choose to do this for a variety of reasons, such as: the patient does not supply the primary insurance info to the provider at the time of service, or the VFC provider is out-of-network with the patient’s primary insurance.
If a VFC provider were to receive a denial from the secondary Medicaid payer, they should appeal the denial with a Request for Reconsideration form specific to that payer, and ATTACH pages 6 and 7 of the Eligibility section of the VFC Operations Manual as supporting documentation.
#3 Reason Claims are Denied - Max Frequency/Benefit reached
Sometimes you will receive a ‘Maximum’ or ‘Frequency’ denial for a routine service, such as a well-child visit or an immunization. Your first action should be to call the payer and ensure the claim was processed correctly. Inquire about the DOS of the original service rendered, and confirm the benefit structure for that type of service.
For example, if you received a denial for an MMR vaccination, you could ask, “when was the original MMR given? What is the patient’s benefit for routine immunizations?” If the payer is correct, then the provider must determine if the repeat service was established through medical necessity. If the supervising medical professional feels that the service was rendered due to medical necessity regardless of previous frequency, the provider should appeal the denial with supporting medical documentation. If the payer upholds the denial, and does not pay, the provider should ensure that the payer allows them to flip the balance to patient responsibility. Always ask them to send you an EOB displaying the balance as patient responsibility.
Routine Immunizations, in large, should be paid by all payers. With new mandates in the Affordable Care Act on preventive care, these visits should primarily be paid as first-dollar benefits; meaning they should not be subject to co-pay and deductible. If a provider is experiencing a denial on a routine vaccination, there is a good chance that the accountability lies with either the patient or the provider in how they billed the claim.
Upp Technology offers an easy-to-implement healthcare claims management solution to help keep public health departments doing great work for our communities. With our program, local health departments can learn how to develop self-sustaining revenue with minimal upfront costs. Learn more about how we make revenue generation for public health easy!