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Importance of Denial Management in RCM

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A successful dental practice is defined not only by the capabilities of the dentist handling it but also by the overall quality of the services that is provided to the patients. Denial Management is one of the key aspects that every practice requires to improve in order to improve its Revenue Cycle Management (RCM) and ultimately the quality of service that it is able to provide to patients. This article is going to talk about Denial Management, an integral part of management of a dental practice, and its importance in RCM.

A straight answer to the question – What makes Denial Management in RCM so important – would be its role as one of the most important elements in healthy cash flow! But, managing claim denials has always been a difficult thing to handle for every healthcare organization. While traditional approaches to denial management focus more on symptoms rather than causes and solutions, the modern-day approach focuses on uncovering the causes behind denials and getting a solution to either avoid them or get paid for them faster. Let’s understand the Denial Management Process.

Understanding Denial Management Process

According to a report in California, health insurance companies reject one out of five claims that makes denial management an extremely critical element not just for a dental practice but for every healthcare organization. An effective denial management process usually covers the following:

  1. Determining the cause of claim denial,
  2. Investigating rejected or unpaid claims,
  3. Observing or tracking general reasons behind denial not just with one but multiple health insurance providers, and
  4. Appealing for denials as per the process

However, for many practices or healthcare organizations, handling the claim denial process in-house is not easy as besides handling the operational tasks, they need to focus on patient care as well.. So, outsourcing denial management services seems to be the perfect solution. 

Let’s understand how the entire Denial Management Process, step-by-step, improves Revenue Cycle Management for a practice!

The denial management process begins with finding the cause of the denial. According to a report, the most common claim denial reasons show that 90 percent of the denials can be prevented, but they still happen! The usual reasons for claim denials are – Late claim submission, Duplicate claim submission, Incorrect or missing patient information, Service mentioned in the claim not covered by the insurer, incorrect registration data or documentation error, pre-authorization errors, etc.

Filing for claims while taking care that errors listed above don’t creep into the process  is the main task for a denial management team. From creating a denial control system to appealing for rejected claims right away, it takes a lot to remove the common denial causes to improve the RCM.

It’s critical to outsource denial management services. When a team of experts handles the claim denials, it reduces the chances of claim denials considerably. But why or when you need to outsource the services?

  1. When the claims get piled up but the income is stagnant.
  2. When the receivables add up, but the profits don’t.

How does an efficient Denial Management help?

The following points explain the benefits/importance of denial management in RCM.

  1. Insurance claims getting approved faster
  2. When claims that are either rejected or are unpaid are processed in the right way, the rate of claims getting approved improves and saves a lot of time. The denial management team works closely to file claims while abiding by the guidelines of a particular insurance provider to deliver accurate information. This directly improves the revenue cycle management.

  3. Capability to spend more time on providing quality care and less time on paperwork
  4. The primary goal of a dental practitioner is to focus solely on patient care and  not on claims! Practices, sometimes,  fall short on effectively handling the claim process as the staff spends training hours focusing on providing patient care rather than handling paperwork. When a dedicated denial management team/system is in place to handle everything related to claims, you will have more time to spend on patient care rather than focusing on administrative things. This way, practices do not lag behind on collecting revenue and exceptional patient care will always be provided.

  5. Lesser claim denial ratio
  6. The filing of clean claims with health insurance companies has always been one of the biggest obstacles for dental practices. A dedicated Denial Management Team is an ideal means to avoid rejected claims. It helps you to get paid faster for your work. A team of experts  in billing and coding ensures that your practice submits precise and thorough claims which are accepted the very first time.

Fewer denials lead to improved cash flow resulting in the achievement of revenue cycle goals which makes for a successful dental practice!