Why a Safety-Net Review could save you millions
Denials and underpayments are a constant challenge for hospitals, putting significant pressure on financial teams to recover lost revenue. With continual market shifts and inconsistencies in payor behavior, staying on top of these issues can feel like a moving target. That’s where having a safety-net review comes in—leveraging analytics, AI technologies, and decades of expertise to help hospital teams recover cash, minimize false variances, and optimize reimbursement processes.
Benefits of Safety-New Review
By utilizing real-time analytics and financial expertise, a safety-net review helps hospitals identify recovery opportunities, optimize collections, and improve billing workflows through targeted, data-driven analysis.
Identifying True Payor-Related Variances
False variances—issues that appear as payment discrepancies but are not recoverable—can waste valuable time and resources. These might include registration errors or outdated payor policy changes that are challenging to track. To combat this, you need to zero in on genuine payor-related variances like denials, underpayments, short-pays, no-pays, and shifts to patient responsibility to help hospitals focus on actionable discrepancies.
Technology and Hands-On Experience
When looking for a technology partner, ensure they can integrate real-time analytics the benefits of financial expertise to identify trends in areas such as authorization denials, billing errors, coordination-of-benefits issues, and contractual miscalculations. This comprehensive approach ensures claims are evaluated for all potential recovery opportunities.
A deeper analysis helps to optimize collections. By combining denial codes from the 835 forms with contractual reimbursement calculations, even partial denials and discrepancies can be uncovered and recovered . This method not only ensures maximum recovery but also helps hospitals identify denial patterns and make data-driven improvements to their billing workflows.
Common Trends Impacting Reimbursements
Contractual Variances and Bundles
It’s not uncommon for payers to underpay hospitals despite contracts that specify clear reimbursement terms. These contractual variances often arise when payers bundle charges that should be reimbursed separately or overlook outlier amounts for high-dollar claims.
Hidden Reimbursement Opportunities
Sometimes, underpayments go unnoticed because they don’t present as obvious contractual variances. For example, reassigning charges from one revenue code to another with a carved-out rate can reveal additional reimbursement opportunities. By leveraging advanced reporting tools, safety-net recovery proactively identifies similar discrepancies across payers and prevents them from occurring in the future.
Tailored reports can provide hospitals with a roadmap to monitor recurring payor issues and position themselves to recover lost revenue efficiently.
Rising Authorization Denials
One alarming trend over the past year is the sharp rise in authorization denials—up by 47% YoY in 2024, according to our analysis. This trend spans across all major payors.
Authorization-related issues stem from multiple scenarios, the most common include:
- Claims where authorizations were obtained but not accurately billed.
- Authorizations overlooked by payers, leading to incorrect denials.
- Situations where authorization was not secured due to the timing of emergent care.
- Lack of knowledge about codes or treatment plans that require prior authorization.
- Service modifications during treatment that lacked updated authorizations.
High-Dollar Claims Under Greater Scrutiny
High-dollar claims are subjected to additional review stages by payers, increasing the potential for delays or denials caused by overlooked documentation or authorization gaps. Hospitals often delay addressing these issues until a denial or formal request is received, further exacerbating reimbursement delays.
Best Practices to Reduce Authorization Denials & Have Timely Reimbursement for High-Dollar Claims
To improve authorization success rates and see timely reimbursements for high-dollar claims, our team follows these key steps to get paid quicker:
- Thorough Claim Preparation: Double-check that all billing and coding align with payer-specific requirements.
- Comprehensive Authorization: Ensure every required treatment, day of stay, or service is pre-authorized before claim submission.
- Proactive Documentation Submission: Send supporting documents like medical records or itemized bills alongside the initial claim to expedite the review process.
Following these best practices minimizes delays and enhances recovery outcomes, particularly for high-dollar claims. With the combination of a tool like PMMC’s RecoveryAI® and decades of healthcare finance experience, safety-net review not only alleviates some of today’s reimbursement challenges but also helps hospitals build a resilient, future-ready financial strategy.
Want To Know What a Safety-Net Review Could Save You?
If you’d like to learn more about how safety-net reviews can enhance your organization’s financial health, meet with our team of experts today.
Did you miss our recent webinar, Building A Strong Safety Net: Retrospective Insights from Managed Care and Revenue Cycle Leaders?
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Take the Next Steps
If you’d like to learn more about how safety-net reviews can enhance your organization’s financial health, check out our webinar. We dive into denial trends, best practices for authorization claims, and strategies for leveraging technology to recover lost revenue.