Revenue recovery is a hot topic at federally qualified health centers (FQHCs). As denials in medical billing increase across the United States, FQHCs are facing a drop in reimbursements for their valuable services.
Here’s the good news: Some forward-thinking FQHCs are bucking the trend through effective revenue cycle management (RCM).
This article examines why denials are on the rise and how you can take proactive steps to protect your FQHC. Learn how to decrease denials, accomplish more successful appeals, and boost revenue through innovative denial management strategies.
FQHCs Have High Utilization Rates
The U.S. has about 1,400 FQHCs serving more than 15,000 locations nationwide. An FQHC is a vital healthcare option for people in rural, geographically large, and socioeconomically diverse service areas.
If your FQHC has exceptionally high utilization rates for things like ER visits and emergency surgical care, you’re not alone. The Journal of the American Medical Association (JAMA) found that over 10 years, rural ER visits nearly doubled from 16 million to over 28 million. At the same time, Medicaid-covered visits grew from 4 million to almost 10 million.
When utilization rates and claims denials are high, the pressure is on FQHC staff to manage strenuous workloads and track thousands of medical claim reimbursements for services rendered. Managing claims through the entire submission and reimbursement process is a lot to handle when you’re trying to keep the focus on patient care.
Denials - Why Revenue Recovery is More Important than Ever
Denials are rising for many reasons, so beware of attributing your increase to a single issue. When one of the nation’s largest healthcare organizations studied the top 6 reasons for denials, they found the main concerns among healthcare executives are:
- Inadequate data about the causes of denials
- No process automation
- Little staff training
- Not enough in-house expertise
- Old technology
- Staffing shortages in the healthcare industry
How Many Claims Are Denied?
Overall, the rate of denials in medical billing ranges from 10% to 20% of all claims received by payers. Among those on Medicare, claims for Medicare Advantage tend to be denied at higher rates than those for other payer categories.
In a Kaiser Family Foundation (KFF) study of Affordable Care Act (ACA) marketplace claims, the denial rates varied even more widely than reported in other studies. ACA-related denial rates range from 2% to 49% due to many factors, including lack of preauthorizations, submissions for excluded services, lack of medical necessity, and other reasons.
“Other reasons” accounted for a whopping 77% of all denials in the KFF study. Fewer than 1% of denied claims were appealed in the KFF study, but 41% of those appealed were later approved.
This is notable because errors and misunderstandings in the claims submission process may play a significant role in high denial rates. Appeals also have a good chance of approval. Any billing office at an FQHC should take note and respond accordingly. Altruis can conduct a billing assessment to determine which issues impact your denial rates.
Proactive Steps Toward Revenue Recovery
For an FQHC, managing revenue goes beyond just sending off your claims and hoping for high reimbursement rates. The process takes a proactive approach with proper follow-through. Take a closer look at the following activities and determine whether your staff may need extra training, support, and assistance from an outside partner like Altruis.
Claims management terms can be challenging to understand, especially when new hires are on your team. Go through standard terms like appeals, denials, rejections, and resubmissions. Explain the difference between rejection and denial and which claims may still be eligible for resubmission. Any misunderstanding can be costly for an FQHC.
Claims should always use the most up-to-date information and effective claims management processes. Broadly speaking, accuracy and completeness are the keys to submitting claims correctly and gaining a high rate of first-time approvals.
Review the medical coding standards at your FQHC. Your staff may need additional training or assistance with systems like CPT, HCPCS, and ICD-10. They may need help learning the latest coding rules, modifiers, and documentation requirements.
Handling denials appropriately takes knowledge, experience, and a bit of finesse. Refine your process to address coding problems proactively and analyze your process to identify opportunities for greater success. Following up with payers promptly about the details of denials can be an excellent way to improve your denial management.
Even your best billing employees may need help to stay ahead of complex payer reimbursement policies. Provide guidance on various requirements and coach them on addressing common causes of denied claims.
Set the stage for a smooth process by gaining any necessary pre-authorizations long before procedures take place. Verify details like the patient’s benefits and coverages early to prevent extra work and potential denials.
Better revenue cycle management (RCM) involves identifying persistent issues with your current processes and resolving them successfully to improve your revenue flow. The goal is to minimize errors and become more efficient while finding fresh ways to maximize your revenue.
Defeat Denials and Harness Revenue Recovery Success with Altruis
Altruis can help. Your FQHC can reduce its denials and raise its revenue significantly. Altruis has helped clients see revenue increases of $1 million or more through effective denial management and other revenue recovery strategies.
How do we do it? Altruis works with FQHCs in harmonious partnerships to establish effective processes for avoiding denials, making appeals, and gaining more approvals. With our services, you’ll enjoy a smoother and faster claims process and an overall healthier approach to revenue generation.
Please contact Altruis to learn more about how we can help your FQHC succeed.