List and describe four common types of problem insurance claims in the medical office.

Question

What will be an ideal response?

Answer 1

A. Suspended or pending claims. Claims that have been suspended, which is another way of saying they are pending, are usually being reviewed. A claim in suspension might simply require more information from the provider, and until it is received, the claim is pending payment. In other instances, the claim may need to be reviewed by medical professionals who represent the insurance company. These reviews may be done to confirm medical necessity, investigate complicated claims, or for other reasons. After the additional information is received, or the claim is reviewed, a decision as to whether it will be paid, denied, or have the reimbursement reduced will follow.

B. Payments made to patients by the insurance company. On occasion, the reimbursement check for services may be sent directly to the patient instead of the provider. This may be an error made by the insurance carrier, or the assignment of benefits was not properly signed and disclosed on the claim showing that payment was to be made to the provider. In either case, when the patient is paid the full, or even a partial amount, this becomes a collections issue for the medical office. There are times that the medical office is not notified that payment has been made to the patient. This information can be verified by contacting the insurance company directly. If it is confirmed that the patient has received payment, the patient will need to be notified and billed for the amount due. Further collections action or even legal steps may need to be taken if the patient refuses to pay the provider.

B. Payments made to patients by the insurance company. On occasion, the reimbursement check for services may be sent directly to the patient instead of the provider. This may be an error made by the insurance carrier, or the assignment of benefits was not properly signed and disclosed on the claim
showing that payment was to be made to the provider. In either case, when the patient is paid the full, or even a partial amount, this becomes a collections issue for the medical office. There are times that the medical office is not notified that payment has been made to the patient. This information can be verified by contacting the insurance company directly. If it is confirmed that the patient has received payment, the patient will need to be notified and billed for the amount due. Further collections action or even legal steps may need to be taken if the patient refuses to pay the provider.

C. Lost claims. A lost claim is one that the insurance company has no record of having received. Practice management software and clearinghouses have reduced the incidence of lost claims substantially, especially by providing editing features and producing reports of claims that have been electronically
transmitted. Paper claims are more likely to be lost, or insurance carriers can become backlogged. If a claim appears to be lost, usually after 30 to 45 days of inactivity without payment or notice of any kind, it is a good idea to trace the claim with the insurance company. This can be done either with a letter, or by placing a phone call to the insurance company. If there is no record of the claim, it is appropriate to rebill it. Some offices will provide the insurance company with a copy of the original claim and a letter stating the date of the original billing. However, if the original claim and the rebilled claim cross each other, expect one of the claims to be denied as a duplicate claim.

D. Denials. Denials, also referred to as denied claims, are those that have not been paid, and a reason has been given. In fact, the law requires that insurance companies disclose to the policyholder why a claim has been denied. If the claim originated from the provider’s office, it is customary for the provider to be notified as well, usually on the explanation of benefits. The reasons claims are denied can be numerous. These may include insurance guidelines not being followed, or the services were incorrectly billed or are excluded by the plan. Preauthorization may have been required but was not obtained prior to the service being rendered. Some services are considered to be included, or “bundled,” with other services, and are therefore denied for payment when billed separately. Each denial must be carefully studied and, if possible, corrections and resubmissions made so that payment can be received.Some claims are denied because the medical office omitted or incorrectly submitted information on the claim. Errors made by the office are the main cause of denials. Examples of such errors include incorrect policy numbers, not providing the insured’s name and information, transposition of numbers, not confirming which insurance is the primary payer, incorrect dates of service, missing or invalid provider numbers, CPT- and ICD-coding errors, duplication of charges that have already been submitted, and missing referral information. Again, care and diligence on the part of the administrative staff can avoid the majority of these types of errors before claims are even processed. The best solution to reducing denied claims is to be sure that the billing procedures being followed are actually producing “clean” claims.