I-Med Claims - Medical Billing Company
Tips to reduce claim percentage

Tips To Reduce Denied Claim Percentage 

 Medical practice suffers when a claim is refused. Poor claim management can harm the practice’s financial health and sustainability. When you file a claim to any insurance provider, it will be paid, rejected, or denied. The majority of the time, providers misunderstand claim rejection and claim denial. When a claim is rejected, it usually implies that the details in the claim are either insufficient or incorrect. You must provide correct and complete patient insurance information to process a claim. However, if your claims were denied, the payer evaluated your claim and denied payment.

How Can You Limit The Number Of Medical Billing Denials?

Even the most precise and generally popular medical practices do not have zero healthcare insurance claim denial rates. You can lower your denial rate through proper documentation, billing, and coding. But medical documentation, billing, and coding are not easy tasks. Reduce your practice’s denial rate by following these seven procedures.

Determining Primary Causes Of High Denial Rates

The first and most practical strategy for lowering high denial rates is to investigate the possible causes of the increase. The reasons for high denial rates differ depending on the practice and expertise. As a result, it is critical to begin this process by assembling the claim adjustment reason codes to build a denial management plan. These codes may be irregular and confusing, but translating them to actionable characteristics can offer you a comprehensive and in-depth look into the fundamental cause of the problem. Some common causes of an increase in denial rates include:

  • Expired Eligibility 
  • Inadequate medical authorization 
  • Claim duplication
  • Incorrect insurer address
  • Incorrect modifier
  • Inadequate supporting documentation
  • Wrong diagnostic codes or procedures
  • Billing for unnecessary medical procedures
Correctly Verifying Patient Information

According to MGMA health insurance claim denial statistics, 42 percent of healthcare providers believe that prior authorization is the top reason for medical billing denials. Many medical institutions fail to monitor critical and minute facts regarding patients receiving diagnosis or treatment at their facility, which could be due to understaffed employees, tight schedules, or simple negligence.

Difficulty obtaining accurate demographic information upfront can result in an unstable situation and a stream of denial claims. Teach your team to get this critical information as soon as possible, such as when you schedule an appointment or when the patient comes in.

Keep Track Of Every Claim

The most straightforward strategy to reduce claim denials is to accurately account for each filed claim. Most clinics are just concerned with submitting claims as quickly as possible and will not track them. You must keep track of every submitted claim to designate them as paid, denied, rejected, or in process. According to industry standards, having roughly 10% of claims denied is pretty acceptable. It is normal because you may be charging new payers or services, or patients may have shifted insurances. Try to limit your denial percentage below 10%.

Appeal Every Denial

Analyze every denial to see if there’s cause to appeal; move forward. Analyze the denial, demand it, and maintain your denial letter brief and accurate. Many billing software packages provide a scrubbing feature to estimate claim denial or rejection before filing the claim. If you are unclear, contact the insurance company to find out what further evidence is required.

Discover The Most Common Denials

When you start recording every claim, you will see trends in claim denials, whether they are patient, payer, or procedure code specific. After determining the most common cause of your claim denials, well-tested resolutions will assist you, and you will be able to rectify claims without much investigation. Some frequent denial reasons include the patient’s coverage expiring, lack of prior permission, incorrect diagnosis codes, and a timely filling limit that has passed. Once you’ve identified the most prevalent denial reasons, you can alter your billing process to avoid future denials.  

Utilize Technology To Assist In Ensuring Clean Claims

While some of these suggestions may appear challenging to implement, many of them may be automated. Your practice management system or EMR may have built-in notifications to guarantee that all required data is captured at every interaction. Many systems will analyze claims before they are filed and indicate (“scrub”) those that lack information or are inconsistent with predetermined standards. Some technological solutions can help ensure appropriate documentation and make sending appeal letters easier.

Use Medical Billing Software

Medical billing software can assist you in keeping track of the details of your claim submissions. Your claims will become less confused and more accurate by entering all the data into a billing form. You have to establish billing notifications so that your practice does not file late claims. You might ask patients for updated insurance information or addresses to avoid claim denial due to a little mistake.


The above-mentioned guidelines will assist you in lowering the number of denied claims and boosting the percentage of paid claims. Proper documentation and coding can significantly help your practice minimize its claim denial rate. If you are having difficulty receiving adequate reimbursement for performed services from patients and payers, we can help. 

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