Healthcare providers are busy enough without having to stress about insurance claims, which is why so many of them struggle to recoup all that they are owed. The rule of thumb is that your practice should reasonably expect to receive between 96% and 99% of all monies owed, yet many counselors see less that 85% paid out in insurance claims. With a little bit of planning and foresight that number can quickly get back up to where it should be.
There are 17 common reasons that explain why claims go unpaid, and they are:
Waiting Too Long To Make The Claim.
Most insurance companies will allow you up to 90 days after service to file the claim. With that said, there are some that have a limit of 30, while others, such as Medicare, allow a full year. If you wait until that time has expired, the claim will more often than not be summarily rejected.
The Claim Expired After It Was Lost By The Insurance Company.
Mistakes can and will happen, which means that there will be times when the insurance company will lose your claim. If that happens and the claim doesn’t get filed until after the expiration date, then you are out of luck. It’s totally frustrating, but even an insurance company that realizes that they are at fault will still deny the claim if it is processed too late.
You Were Missing Preauthorization / Authorization.
A large number of insurance plans require preauthorization, and if that has not been granted before you supply service, the claim will be rejected.
The Patient Wasn’t Referred By A Doctor.
As well as the preauthorization, some insurance companies also require that the patient be referred by their primary care provider (PCP). If you offer services before both of those requirements have been met, your claim will be denied.
You Provided More Than One Service In A Single Day.
Behavioral health has some different rules than other services, with a strict “one service per day” policy in place with most insurance companies. Even if a patient has met all other requirements, you simply can’t offer more than one session to them per day. That’s not necessarily true; you can provide more than one, but just don’t be expect to be paid for anything other than the first session. That includes separate items such as group therapy, psychological testing, and medication reviews, with each one considered a single service.
You Exceeded The Number of Authorized Sessions.
When insurance companies grant authorization, it is usually for a set number of services/appointments. If you don’t keep accurate records of the number of sessions for each and every patient, then you may end up going over what you are eligible to be paid for.
The Authorization Time Expired.
It is not just the amount of service sessions that are limited, which means you need to be sure to check how long the authorization for each lasts (Some are as short as 30 days)
The Patient Switched Their Insurance Plan.
Make sure to ask if the patient’s insurance information is the same every time you see them. If they have switched to another provider, you need to make sure that you are a provider in their network and that they have received a new pre-authorization. Failure to do either will end in a denied claim.
The Patient Lost Their Insurance Coverage.
Failure to pay or loss of a job may result in a patient losing their insurance coverage. There will be some patient’s that are not aware that they have lost it, while others will simply fail to tell you.
The Patient Had A Late COBRA Payment.
COBRA allows people to keep their coverage after they have lost their job, but it also requires that they pay 100% of their policy principle. That usually ends up being a lot of money and many folks often end up behind on their COBRA payments, resulting in your claim being denied.
The Claim Was Sent To The Wrong Managing Company.
It’s not uncommon for insurance companies to shift certain services (such as behavioral health) to other managing companies. If you are not aware of this, you could very well end up sending your claim to the wrong company, which will result in denial.
The Provider isn’t Paneled with the Insurance Company
It seems obvious to say that as a provider you have to be paneled with a patient’s insurance company, but with so many of them merging, it can be difficult to keep track of who is with whom. Insurance companies can now have multiple different panels within their company, and that can lead to a lot of confusion, not to mention denial of claims. It’s important to keep up to date with who you are paneled with in order to make sure that all of your claims are accepted.
You Provided Service At The Wrong Location.
When you are paneled with an insurance company, they will usually have a list of your practice addresses. You must make sure that your provide service at those locations only, otherwise it will be seen to be an unregistered location and will result in your claim being denied.
The Client’s Out-of-network And In-network Benefits Are Different.
There is a big difference between these two types of benefits, with the patient generally being responsible for a larger chunk of the total payment when going out-of-network. It’s up to you to determine the actual amount that is owed by the patient or you may never end up receiving a penny from the insurance company.
The Service Was Already Provided.
Insurance plans often allow a patient an intake appointment (90801) once every 3 months, which means that if the patient saw another counselor within that timeframe, your claim may be denied.
The Patient has an Out-of-State Insurance Plan
It may not matter that an insurance company is networked with you if a patient provides an out-of-state plan. Depending on the type of coverage, you may only be reimbursed for a fraction of the total bill, or have the claim denied completely.
The Patient Is Carrying An Unmet Deductible.
The co-pay amount on a patient’s insurance card means nothing if they have an unmet deductible. That could mean you getting nothing back from the insurance company, with January being a particularly sticky month as that is when deductibles reset.
It may seem that being networked with insurance company is more trouble than it’s worth, but the truth is that it can help you build a large number of paying patients that you might not see otherwise. Insurance coverage has now progressed to the point where most plans come with mental health benefits as part of the package. The insurance world changes fast and you need to be prepared to keep up.