Healthcarercm

  With financial pressures continuing to increase, healthcare providers constantly need to find ways to improve their bottom line. One often overlooked area with significant potential for impact is effective contract management, especially when it comes to   addressing and preventing underpayments   to unlock missed revenue potential. Understanding the Impact of Underpayments Underpayments occur when payers do not fully reimburse providers for the services delivered, based on the terms of their managed care contracts. This can happen through outright denials or more subtly, through reduced payments that providers may mistakenly accept as complete. These issues can significantly impact the financial health of healthcare organizations, as the American Medical Association (AMA) estimates the accuracy rate of payments by insurance companies at only 77%. This means more than one in five claims are not appropriately reimbursed according to managed care contracts. Research indic...

  In our previous article,  “Denial Remediation: The Road to Revenue Recovery” , we highlighted the significant impact of denials on healthcare organizations. The encouraging news is  85% of denials are preventable  and  67% of the denials are recoverable . Furthermore, 41% of appealed denials get reversed, underscoring the importance of addressing denials. A strong  “prevention and denial management program”  can yield as much as  $5 million in additional revenue  that otherwise wouldn’t be recognized for a typical hospital. It is much more cost-effective to run preventive programs that span the entire revenue cycle than to spend time investigating and reworking claims in a silo or having a reactionary program. Hospitals with better controls to manage and prevent denials will see reductions in their cost to collect percentage as first pass pay rate increases and denial rework decreases. Proactive Strategies for Denial Prevention To combat th...