Denied claims cost your practice both time and money. Employees spend precious hours researching and processing denials, only to find that payers are unresponsive or unwilling to overturn their decision. Given the complexity of our reimbursement system, denied claims will always exist. However, there are certainly opportunities to reduce their prevalence, thereby decreasing their adverse impact on your practice’s bottom line. Let’s review five strategies to address denial prevention.
Developing internal expertise to manage commonly received denials is vital to the success of your revenue cycle. While many practices seek to resolve denied claims, the true goal should be preventing them entirely.
Ten Common CARCs:
The electronic remittance advice (ERA) from a payer includes codes that indicate the reason for a denial or partial payment. These codes are the claim adjustment reason codes (CARCs), which may be accompanied by further detail via a remittance advice remark codes (RARCs). Ten common CARCs are listed here:
PR1 Deductible amount.
CO11 The diagnosis is inconsistent with the procedure.
CO15 The authorization number is missing, invalid, or does not apply to the billed services or provider.
CO16 Claim/service lacks information or has submission/billing error(s) which is needed for adjudication.
CO18 Exact duplicate claim/service.
CO22 This care may be covered by another payer per coordination of benefits.
CO29 The time limit for filing has expired.
CO31 Patient cannot be identified as our insured.
CO55 Procedure/treatment is deemed experimental/investigational by the payer.
PR119 Benefit maximum for this time period or occurrence has been reached
Elizabeth Woodcock is the founder and principal of Woodcock & Associates. She has focused on medical practice operations and revenue cycle management for more than 25 years. She has led educational sessions for a multitude of national professional associations and specialty societies, and consulted for clients as diverse as a solo orthopaedic surgeon in rural Georgia to the Mayo Clinic. She is author or co-author of 17 best-selling practice management books, to include Mastering Patient Flow and The Physician Billing Process: Avoiding Potholes in the Road to Getting Paid. Elizabeth is a Fellow in the American College of Medical Practice Executives and a Certified Professional Coder. In addition to a Bachelor of Arts from Duke University, she completed a Master of Business Administration in healthcare management from The Wharton School of Business of the University of Pennsylvania. She is currently a doctoral student at the Bloomberg School of Public Health of Johns Hopkins University.
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