Strategy Review
In most cases insurance companies have 45 days to process the claim once they receive it. Key words, process, and receive. Remember, they make up to 50% of their profit from interest earned on your money. Not just premiums they have collected from patients. The insurance company strategy comes in four basic flavors.
- Delay claim submission
- Prevent claim submission
- Prolong the “processing” time.
- Take the money they paid back from the doctor.
Now we know their motivation. If you look at the chart above it is pretty obvious. What tactics do insurance companies use to make it happen?
Tactic # 5 – EOB Line item denials and underpayment
Against all odds you successfully sent the claim and they received it. Back comes the EOB. Some codes are denied, some are paid, some are underpaid. All insurance companies have their own unique denial codes and explanation which by themselves can be cryptic. You or your team is supposed to remember each denial code and explanation for all payers? If denial is not bad enough there is line item underpayments. This is where they pay you what you expected for one code but pay you a little less than expected on another code. To combat this you or your biller would need to memorize every combination of expected payment for every code at each insurance company. This is another thousand plus combinations on top of the coding combinations I spoke about earlier. If they underpay for one code by $2 dollars you will have to call them and sit on hold. More on this tactic later, it’s much worse than it seems. The point here is that it is literally humanly impossible to memorize all of the denial codes, expected payment and payer combinations. Even if you could, you would still have to have human eyes look at every EOB leaving your bottom line susceptible to human error. This can be automated. Why take the chance?
