Clinical denials are complex and often require detailed documentation. This places an additional operational burden on already overburdened healthcare organizations and can require increased investments in staffing and technology.
During a recent Becker's Healthcare webinar sponsored by Solventum (formerly 3M Health Care), two revenue cycle experts from Solventum — Josh Amrhein, business manager, revenue integrity, and Diana Ortiz, RN, senior business manager, revenue cycle — discussed how health systems are gaining comprehensive insights into clinical denials by leveraging AI tools and analytics:
Four key takeaways were:
- It's time to take a more proactive approach to denials. Experts believe that as many as 86% of denials are avoidable. Given increased pressure to improve low operating margins, healthcare systems must find opportunities to improve reimbursements and reduce underpayments and takebacks.
"We need to flip the script with denials and be much more proactive," Ms. Ortiz said. "In a preventive model, we take data from your organization, create machine learning models, analyze workflows and identify ways to improve. This is a huge shift from traditional denials management processes."
- Like payers, providers must also wield the power of AI. Payers routinely use data mining and machine learning models to identify opportunities to deny and underpay providers, or to raise questions about documentation and coding. Solventum has found that 15% of providers' insured volume is at risk for denial and between 5% and 7% of revenue is subject to administrative/bad debt write off.
Solventum's machine learning models enable providers to predict denials at specific points, like first DRG, CDI, final coding or discharge. These models produce strong results even at the first instance of DRG presence — around 78% of denials are captured within the top 50% of predictions. "Applying machine learning models on the provider side is the way to get ahead of denials, takebacks and underpayments," Ms. Ortiz said. "Our model results have been fantastic."
- Applying Solventum technology to provider workflows can secure millions in revenue. Solventum recently conducted a pilot program with a $9 billion municipal health system. This program demonstrated that if the organization was using Solventum in their workflows today, this health system would have addressed 1,100 claims and driven around $30 million or 1% of net patient service revenue by preventing denials proactively.
"It's all about predictability," Mr. Amrhein said. "We predict the factors contributing to denials and add an alert or additional step to the workflow to address the issue. When we predict the likelihood of reimbursement, we want to deliver real-time intervention recommendations."
- Actionable denials information can be identified quickly. Once an organization gathers a few years of data, Solventum can quickly create a dashboard with valuable insights. With this information, teams know where to focus their efforts and how to modify workflows.
"There's a critical need for denials prevention — 40% of denials happen on the front end, driving resource-intensive review and follow-up," Mr. Amrhein said. "You need to keep up with how payers review encounters and pay them out. With our machine learning-based solution, we can provide you with enhanced data at your fingertips."
The landscape of clinical denials in healthcare is increasingly complex and challenging, necessitating a proactive and strategic approach from providers. As highlighted in the insights from Solventum’s recent webinar, leveraging advanced AI tools and analytics can significantly enhance the ability to predict and prevent denials, ultimately protecting revenue and improving operational efficiency. It is imperative for healthcare organizations to invest in technology and adopt innovative workflows that enable near real-time intervention and data-driven decision-making. The successful application of these strategies underscores the potential for substantial financial recovery and operational improvement. By transforming denial management from a reactive to a preventive model, healthcare systems can not only enhance their bottom line but also provide better care to patients by ensuring timely and accurate reimbursement processes. As the industry continues to evolve, embracing these solutions will be essential for navigating the complexities of clinical denials and achieving long-term financial stability.
To register for upcoming webinars, click here.