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Common Medical Billing Errors that Can Delay and Deny Claims

Billing errors can be costly and cause problems with patient reimbursements, so medical providers and billers alike need to thoroughly understand the ins and outs of medical billing and coding.

Medical outsourcing solutions are available if you are a new practice or find medical billing tedious and time-consuming. In this arrangement, you pass on the job to someone experienced and certified to handle it.

This way, healthcare providers can focus on what they do best: giving quality patient care. It is also a cost-effective strategy since it doesn’t need to invest in more resources, such as training, software, and human capital.

However, accountability goes both ways. Healthcare facilities need to be aware of the common billing errors to avoid committing them in the first place and making the rest of the process a mistake. They can also track the performance, especially the accuracy, of their coders.

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1. Missing or Incorrect CPT Codes

A CPT code is composed of five numbers that help identify the services rendered by healthcare professionals. These codes are part of a universal system that allows medical claims to be processed quickly and accurately.

Misrepresenting the correct CPT codes on a claim submission may result in the claim being denied, which means the business will not receive payment for services rendered.

2. Missing or Incorrect Diagnosis Codes

A diagnosis code is another series of numbers representing the primary reason a patient has sought out their physician. These codes are used to maintain statistics on healthcare utilization.

They allow physicians to track disease patterns over time, often using them when determining what health coverage an individual is eligible for.

Similar to CPT coding, incorrect diagnosis codes can have negative financial impacts and an effect on the quality of monitoring programs.

3. Missing or Incorrect Revenue Codes

A revenue code is a supplementary number that further defines the CPT and diagnosis codes. This code can provide additional information about who performed the service, what supplies were used, how many units of a certain drug were administered, etc.

Like the other two categories, incorrect revenue codes can result in your claim being denied or payment for services rendered being withheld.

4. Missing Patient Information

All claims must include a patient’s legal name as well as their address and date of birth. In addition to those critical pieces of information, any insurance carrier may also ask that the clinic or hospital submit a member ID number if they have assigned one to the patient.

If more than one provider files a claim for the same patient on the same day that does not use the member ID number, then both providers will receive an error message.

Insufficient information can also be a problem. For example, failing to submit a date of service or modifier can result in payment denials or increased turnaround time for processing claims.

5. Retroactive Date of Service

Claims submitted with a date of service that falls outside the current calendar period will be denied.

6. Incorrect Coding Conventions

All diagnoses and procedures must correspond to one specific code within its respective category. For example, you submit a diagnosis code representing treatment for a condition. In that case, it cannot be assigned as the principal diagnosis (the reason the patient is seeking medical attention).

If there are two or more codes assigned in variations of modifiers for time/length, they must be included on the claim form.

7. Missing or Invalid Plan ID Number

Each insurance carrier has an identification number called a plan ID number, and this must be present when submitting claims. If you are unsure of the plan ID number, then contact the carrier directly to obtain it.

8. Incorrectly Indicated Type of Billing

It is important to indicate if a claim has been billed on an incurred basis, which means the services were covered at the time they occurred, or on an entered basis, which means you are billing for them after the fact. These two types of billing have different implications throughout the payment cycle, so ensure they are indicated correctly.

9. Resubmission of Denied Claims

It is very costly and time-consuming to resubmit denied claims, so avoid doing it whenever possible by obtaining all necessary information before submitting each one.

In past decades, medical billing used to be tedious. It demanded significant memorization of the codes and what they meant. However, with the development of new technology and software, medical billers and coders now have more efficient tools to help them work faster and avoid common errors.

Despite these benefits, human error can still occur. This reiterates why it is important for professionals in this field to never become complacent and continually seek out opportunities to improve their knowledge, skills, and experience.

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