9 Actionable Tips for Reducing Claim Rejections (SlideShare)

Getting insurance claims right the first time is the best way to ensure smooth sailing through the clearinghouse water and getting paid fast.  A rejected claim with errors slows down the payment process, which has an unwanted impact on your practice’s cash flow. The best way to avoid rejections is to submit “clean” claims.

In this article, we will discuss what makes a clean claim, the basics of claim rejections, and providing you with 9 tips on how to best submit a clean claim to minimize those rejections through proper rejection and denial management.


Want more resources like this?


What Is a Rejected Claim?

A rejected claim has one or more errors that do not meet the specific data requirements of your clearinghouse. The clearinghouse has a claim “scrubbing” process that compares the data in your claim to rules about how that data should be presented and in most cases checks completes an eligibility check on the patient. If your claim has errors and doesn’t match the data requirements, then your claim is rejected by the clearinghouse and sent back to your practice to be corrected. In this case it never even gets close to the insurance company.

Claims that go right through the clearinghouse without errors are considered “clean” claims. As you can imagine, the goal is to submit clean claims 100%  of the time and it starts with having a good claims submission and management process. 

What Causes a Claim to be Rejected?

Let’s start by running down a list of several well-known reasons claims get rejected.

  • Incorrect Patient Demographics - This can include using a nickname instead of the name on file with insurance company, an incorrect date of birth, the wrong insurance ID, missing information, or submitting to the wrong insurance.

  • Incorrect Coding – Using the wrong CPT code, an ICD-10 code that does not match the CPT code, or the wrong modifier are all cause for having to read through a number of claim rejection codes.

  • Incorrect Place of Service – Was the service performed in the office, at the hospital, inpatient or outpatient, emergency room or nursing home? Each place has a different two-digit code that must match the CPT code. 

  • Out of Date Information – Using patient information that is out of date or an old CPT or diagnosis code. 

  • Duplicate Claim – Submitting the same claim again whether by accident or on purpose. 

  • Eligibility Checks - Patient is not eligible or has no insurance coverage.

9 Tips to Help Reduce Claim Rejections

A strong attention to detail is crucial in obtaining a clean claim and avoiding rejections. Here are a few practical tips you can use to minimize your claim rejections.

1. Double Check Your Work

Typos are very easy to make, especially when you are working fast to get the job done. Forgetting a digit in an insurance ID number or simply transposing a number will cause your claim to be rejected. Being diligent about double checking your work and using denial management best practices will automatically reduce the risk of denial. 

2. Talk to the Front Desk

The front desk usually collects the patient and insurance information that gets entered into the computer system. Billing needs to communicate and work closely with them to be able to obtain correct information. Getting updated information from patients at each visit will help to get your claim paid. 

3. Verify Patient Coverage

Make sure you have the correct insurance information to bill the claim by verifying eligibility of coverage at each visit. Your billing software should be able to complete real-time eligibility for you. 

4. Stay Up-to-Date on Insurance Carrier Requirements

Monitor your claim denials on a regular basis. Something as simple as a new insurance company requirement that your biller did not know about can lead to multiple claim rejections. 

5. File Claims Within 24 Hours

Avoid timely filing issues and file claims immediately. You may have to put a claim on hold to obtain correct billing information or ask the doctor about a code, but don’t forget about it. A good medical billing software package with electroncic claims submission software has a way to take those claims easily. It’s also important that you work the claim rejections right away, as time is of the essence in both cases. 

6. Preauthorization and Other Numbers

Make sure that any authorization numbers, CLIA numbers or NDC numbers for medications, vaccines and injectables are submitted with the claim. These are easy to find through many helpful websites, as these numbers are required by the FDA.

7. Submit to Correct Insurance

It should come as no surprise that selecting the wrong insurance company to send your claim to will result in a speedy rejection. This is another reason it’s so important for the front desk staff to verify insurance with the patient at each and every visit. Bonus tip: if the patient has multiple insurance carriers make sure to select the correct one as primary. 

8. Insurance Participation

A Provider that is not participating with insurance may also cause your claim to be rejected. If your providers are not credentialed with insurance carriers it’s important to have a system in place to provide your patient an estimate and provide them with a patient payment service that allows them to pay in cash. 

9. Train Staff

Train your billing staff to handle rejections quickly. As I mentioned above, time is of the essence on both sides of the fence, not just when submitting. Far too many claims never get paid simply because rejections aren’t handled appropriately and that can be a huge drain on your practices earnings.

Bonus Tip: Choosing a  Good Billing Software & Clearinghouse

Not all billing software is created equal. Look for these services and features that help automate and reduce errors in the claims process:

  • Electronic patient intake to reduce manual data entry and errors

  • Free clearinghouse setup to submit claims electronically

  • Claim scrubbing to eliminate errors before the clearinghouse

  • Easy and quick eligibility checks within the software

  • Billing analytics to manage and improve insurance reimbursements

  • Built-in EHR for streamlined integration between patient care and billing data

Using an Outside Medical Billing Company

There is a lot of work involved to ensure you are submitting a clean claim. Many practices struggle with rejected and denied claims and have turned to outside billing companies for help. These firms have experienced billers and coders that are qualified to deal with the complexities of medical billing. Outsourcing billing could be a great choice for your practice as it takes the burden of medical billing off of your staff so you can focus on patient care.  With that in mind, make sure you take the time to also understand the true cost of claim rejections.

About the Author

Manny is the CEO of Capture Billing, a successful medical billing company located just outside of Washington, DC. They assist scores of physicians in several...

Subscribe to Our Newsletter!

Enter your email address to receive "Go Practice" as an email newsletter.

Kareo and PatientPop are now Tebra

The digital backbone for your practice success.

The combined power of Kareo and PatientPop

As leaders in clinical, financial, and practice growth technology, Kareo and PatientPop have joined forces as Tebra to support the connected practice of the future and modernize every step of the patient journey. Learn more