Winning the Battle Against Healthcare Denials

Denials. Everyone in healthcare knows the term, but do people realize what is done to help mitigate and prevent them? Nearly 40% of healthcare finance and revenue cycle leaders said their biggest concern this year is managing denials. Denials have increased 20% year over year, which translates to between 3-5% in write-offs. This year alone, we have had the full implementation of the two-midnight rule, a Change Healthcare cyber incident, and constant egregious payer behavior and stall tactics. All of this translates to more denials and more administrative burdens for providers. So, how can we win?

There are some best practice methods that can be incorporated into any revenue cycle operation to help with the prevention and management of denials. The first is to have a data-driven approach. In order to manage and prevent denials in the Revenue Cycle, data needs to be at the forefront of the discussion. Utilizing predictive analytics to help forecast what might happen allows prescriptive analytics to help make a recommendation. This is an important distinction, as clarifying what the business problem is will help simplify a pragmatic solution.

The second method that can be used is moving from specialization to collaboration. Interdepartmental communication is vital to ensuring the prevention efforts being implemented are helping the denials team manage the metrics. Without effective communication, efforts are only solving half the problem. Breaking down the silos and having accountable owners creates a culture of shared accountability, cross-departmental mindfulness, and pooled resourcing, which will help in problem-solving speed and effectiveness.

The last, and probably the most important method, is ensuring your people are set up for success. Lately, one of the big talking points in the healthcare industry is the use of AI and how to use it to combat denials and support efficiencies for the workforce, which generates cost savings. I agree that there is a place for AI in healthcare, especially with denials management. Insurance companies are already using AI to deny claims. However, the key here is understanding that innovation can be gradual and will only be realized if providers agree that it fits how they do their work. While the industry works towards new AI, machine-learning (ML), and robotic process automation (RPA) solutions that can be slow to materialize, don’t neglect the practical solutions that are available now. Invest in your people’s growth—bringing fresh tools and perspectives to aid in their professional and personal development.