In an interactive session at Becker's 9th Annual Health IT + Digital Health + RCM Conference, Colleen Goethals, Vice President of Mid-revenue Cycle at Xtend Healthcare, a CorroHealth Company, addressed the persistent issue of claim denials in healthcare. She highlighted the increasing complexity and frequency of denials, noting that 89% of hospitals report a rise in denials, with some experiencing up to a 22% increase year-over-year.
Ms. Goethals attributes this to payers' advanced technology and policy changes, which outpace healthcare organizations' adaptations. During the session, she emphasized the importance of provider organizations understanding denial data, identifying root causes, and implementing proactive strategies — such as forming multidisciplinary teams, ensuring accurate documentation, and maintaining robust appeals processes. Ms. Goethals also stressed the need for continuous education, training, and process improvement to transition from denial management to prevention.
Three key takeaways from Ms. Goethals' discussion with healthcare executives are summarized below.
1. The dramatic increase in denial rates is placing significant strain on hospital and health system finances.
During the session, Ms. Goethals said the total cost for providers to pursue delayed and denied claims is estimated at $20 billion. Considering year-over-year increases in denial rates — like the "maddening" jump from about 9% to 22% at some hospitals, Ms. Goethals noted — it's clear the current state is not sustainable.
"If we're ever going to get a leg up on this, we've got to do constant education and training, and then of course, continuous process improvement," she said.
Ms. Goethals offered a key piece of advice for healthcare leaders.
"Know your denial rates," she said. "Use that denial data to identify and classify what the root causes are for your denials. I still see facilities who just focus on overturning denials on the back end. If they put more effort into denial prevention, they wouldn't have to deal with as many denials on the back end."
2. Myriad factors contribute to growing claim denials, requiring multifaceted prevention strategies.
Ms. Goethals said the leading reasons for denials include missing or inaccurate data, authorization issues, and patient information problems. Moreover, providers are struggling to keep up with the rapid pace of technology and policy changes from payers. Ms. Goethals noted an estimated 100,000 payer policy changes between March 2020 and March 2022.
"How can anyone possibly keep up with that? It's just crazy," she said. "But that's the number that has been widely reported, and it's just daunting to me."
Many hospitals and health systems lack resources to keep up with denials, compounded by issues like staff attrition, inadequate pre-authorization tracking, and organizational technology changes. In this environment, Ms. Goethals said, implementation of prevention strategies is paramount.
Provider organizations should consider forming multidisciplinary teams to analyze workflows and identify root causes, focusing on areas like scheduling, patient registration, clinical documentation, and coding. Ms. Goethals recommended maintaining quality coding practices and having a robust appeals process. She also underscored the importance of clinical support.
"Having a physician champion is key," she said.
3. Continuous monitoring, tracking, and reporting of denial data is crucial to driving improvements.
Provider organizations should measure their success rates in overturning denials and use that data to justify resources for denial management and prevention efforts, Ms. Goethals said.
Measuring failures is just as important. Ms. Goethals advised that provider organizations track and document second-level denials and carefully analyze failed efforts.
"The only way you learn from your failures is to report them and understand what they are, and then you can turn those failures into future successes," she said. "Sometimes, you're going to have to do a deeper dive on it, and a light bulb will go off — and then, you educate. This is the way you're going to move from the management to the prevention of denials."