Timely Filing Denials are on the Rise. Here's What You Need to Know

Timely filing denial rates are hitting revenue cycle teams harder than ever, with a staggering 267% increase YoY for timely filing denials on appeals. This surge is more than just an unsettling trend; it represents significant revenue loss and operational inefficiency. To protect your organization’s bottom line, addressing this issue requires both immediate action and strategic contract renegotiations.

Recovery - Addressing the Here and Now

The first step in mitigating timely filing appeal denials is understanding where and why they’re happening. Timely filing denials on appeals are often a clear indicator that your underpayments team isn’t meeting required deadlines. The standards for these appeal deadlines typically fall within 120-180 days but can be as short as 90 days from the discharge date.

Benchmarking against Medicare enables you to: 

• Increase in Denials: Across the board, organizations are experiencing a sharp increase in timely filing appeal denials. This isn’t limited to one specific payor but appears to be an industry-wide trend.
• Revenue at Risk: If only 60% of your denials are overturned, you’re still leaving 40% of denied revenue on the table. For organizations with millions of dollars in claims, the financial hit is impactful.
• Operational Inefficiencies: Inaccurate or missing information, lack of prioritization, or insufficient resources might be driving these denials further up.
  

What to Do About It

Here are actionable steps to resolve timely filing issues:

1. Streamline Work Queues: Prioritize claims nearing filing deadlines. Use AI-powered technology to flag and rank claims based on urgency and collectability, ensuring resources are focused on at-risk accounts.
2. Implement Automation: PMMC’s AI tools can identify bottlenecks, auto-generate appeals, and monitor upcoming deadlines, reducing the manual workload on your team. Leveraging automation and robust analytics ensure underpayments don’t slip through the cracks.
3. Use Advanced Analytics: Adopt analytics tools to monitor KPIs, spot trends in your underpayments, and identify recurring payor issues. A data-driven approach helps pinpoint root causes faster.
4. Safety-Net Review: Partner with external vendors specializing in safety-net recovery to help your team recover all potential opportunities. 

These solutions will empower your team to maximize revenue recovery while minimizing operational strain.

"Through leveraging advanced analytics, our team effectively manages the challenges of strict timely filing deadlines and complex payor behaviors. These insights enable us to strategically prioritize claims while ensuring no variance is missed. We maintain full visibility into every account and keep payor delays from impacting our clients.” - Cheyenne Williams, Manager of Recovery Services, PMMC

Re-Negotiate – Setting Yourself Up for Future Success 

Elevate and Simplify Your Negotiation Strategy  

While recovery efforts address the immediate problem, they don’t fix the systemic issue of restrictive contract terms. If your current contracts only allow 90 or 120 days for filing, you’re already fighting an uphill battle.

Why Renegotiation Matters

• Short Filing Deadlines = Lost Revenue: Short deadlines limit your ability to address errors; process appeals or handle high claim volumes effectively.
• Use Timely Filing as a negotiation lever: Historically, hospitals and payors maintained a timely filing provision of 365 days. Today, payors are pushing to reduce that window to 180 days or less. This reduction puts more pressure on the revenue integrity department to identify variances and work those to fruition. A 365-day filing window is ideal, however we recommend holding payors to over 180-day filing window when possible. Modeling your contracts can help you communicate the full impact these shortened timelines have. Use these deadlines as a lever during negotiations to secure more favorable terms.
  
  "When you take the opportunity to model your data the way payers do, you can move from a reactive stance to a proactive strategy that works to your advantage. With this insight, you’re better equipped to approach negotiations with clarity and confidence." - Maria Torres, Client Performance Manager, PMMC

How to Renegotiate Your Contracts

1. Audit Your Current Contracts: Use audit analytics to review contracts with every payor and identify filing deadlines. Highlight those with restrictions that increase the risk of timely filing denials.
2. Use Data to Support Negotiations: Payors respond to well-documented trends. Use analytics, benchmarks, and peer comparisons to justify extending filing periods.
3. Advocate for 365 Days: Push payors to adopt 365-day filing limits wherever possible. This standard is becoming increasingly common across the industry and provides breathing room to manage claims effectively.
4. Establish Accountability: Once renegotiated, implement robust analytics and automation tools to ensure compliance with each contract, minimizing avoidable denials going forward.

Proactive renegotiation not only aligns your filing deadlines with operational capabilities but also helps establish a more equitable relationship with payors.

Take Control of Your Revenue Cycle

The increase in timely filing denials isn’t just a temporary hurdle—it’s an industry shift that demands immediate attention. Every missed appeal and every restrictive contract costs your organization revenue. Whether through efficient recovery practices or renegotiated terms, the goal is clear: stop the losses and reclaim your bottom line.

Across the board we’re seeing more denials. We’ve seen an increase in denials due to aging AR days, prior authorization denials, high dollar account denials and more. These denials aren’t going away – it's time to focus on how to adjust your contract negotiations to ensure denials don’t eat away at your revenue.

By prioritizing claims, leveraging cutting-edge tools, and pushing for fair contract terms, your team can confidently address challenges in today’s shifting landscape. Act now to protect your revenue and position your organization for long-term success.