Time to feel sorry for hospitals, as Change Healthcare releases an analysis of their problems with claims denials. (CHC Analysis) The analysis covered bills submitted by over 700 hospitals and extrapolated to the full set. According to the firm, hospitals submitted $3 trillion in claims to payers in the US last year, and a paltry $262 billion, or 9%, received an initial denial from the payer. Denials are highest on the Pacific coast and lowest in the Northern plains region. An average of $4.9 million in revenue was put at risk by the denials, but 63% of this amount was recoverable. The cost for reworking claims, however, was put at about $118 per claim or around $8.6 billion annually. The most common reasons for denial are patient eligibility, missing or invalid data, lack of pre-authorization and an uncovered service. So note that claims are most commonly denied because of missing basic information about the patient or the service, so it is on the hospitals to get that right in the first place. Denial management has become a common vendor, i.e. Change Healthcare, service, but more work apparently needs to be done on the very front end of claims submission. The administrative cost for providers and payers of reworking claims is wasted money, and anything that can avoid that would be good. Why do I think, however, that all the savings that might accrue for that will just go to the hospitals’ bottom line. Just hard to be sympathetic to hospital claim denials, when their excessive charges, particularly to commercial plans, are a compelling factor in health spending growth.
✅ Subscribe via Email
About this Blog
The Healthy Skeptic is a website about the health care system, and is written by Kevin Roche, who has many years of experience working in the health industry. Mr. Roche is available to assist health care companies through consulting arrangements through Roche Consulting, LLC and may be reached at [email protected].
Healthy Skeptic Podcast
This is an outstanding report on total global drug spending and trends, with projections out to 2025. It helps you understand this important area of health care, which does much...
June 1, 2021
MedPAC 2019 Report to Congress
June 18, 2019
In an attempt to swiftly revive two floundering health care companies, a PE firm has announced the merger and recapitalization of Revive Health and SwiftMD. You know they are...
January 30, 2023
Investors have not yet learned their lesson, as Pearl Health gathers a new round of $75 million in capital for its business of supporting physicians who want to participate in...
January 30, 2023
Now here is a tale from the glory days of epidemic investing, as the Feds pumped trillions into the economy and a lot of it went to investing, some to...
January 10, 2023
Access ACO Care Management Chronic Disease Comparative Effectiveness Consumer Directed Health Consumers Devices Disease Management Drugs EHRs Elder Care End-of-Life Care FDA Financings Genomics Government Health Care Costs Health Care Quality Health Care Reform Health Insurance Health Insurance Exchange HIT HomeCare Hospital Hospital Readmissions Legislation M&A Malpractice Meaningful Use Medicaid Medical Care Medicare Medicare Advantage Mobile Pay For Performance Pharmaceutical Physicians Providers Regulation Repealing Reform Telehealth Telemedicine Wellness and Prevention Workplace