Work silos—fragmented teams working independently of one another—represent a significant barrier to high-quality communication and collaboration, without which healthcare organizations cannot achieve optimal revenue cycle performance. Denial management is a perfect example.
The impact of silos in denial management
Payers are denying a record number of claims, especially Medicare Advantage plans, costing providers millions in lost revenue potential annually. A 2023 brief by KFF shows an average denial rate of 17% on all in-network claims, 24% for authorization denials, and 37% for medical necessity denials. Another report found that more than 22% of organizations claim to lose half a million dollars annually due to denials and 10% say they lose more than two million due to denied claims. Siloed teams are part of the problem.
Coding, CDI, billing, denials management, and compliance all need access to the same information so they can work collaboratively to resolve problems that inhibit an optimally performing revenue cycle. The lack of collaboration causes communication breakdowns, limited information sharing between departments, and duplication of efforts—all leading to increased denial rates and delayed or inaccurate reimbursement. A lack of cross-functional collaboration can also decrease staff morale and increase turnover.
Silos make it more challenging for different revenue cycle teams to collaborate effectively, leading to poor revenue performance and more work for already overworked staff.
Improving collaboration to break down silos and reduce denials
One of the best ways to improve cross-team collaboration and reduce denials is to create shared, measurable goals based on industry best practices. At a minimum, these could include clean claim rates, days in A/R, and denial rates. Each member of these teams should have key performance indicators (KPIs) tied to those goals. This helps create a culture of teamwork with an aligned vision that encourages collaborative decision-making and problem-solving.
Training and education, including multidisciplinary training, are critical for optimal collaboration and reduced denials. Understanding the impact each stakeholder has in the revenue cycle process gives each team member better insight into how their work plays a role in reducing denials and the collective success of all teams. Holding cross-functional team meetings can also help by ensuring problems are being addressed by the most appropriate team member. For example, a charge captured incorrectly that resulted in a denial should be handled by the person responsible for capturing the charge, not just the denial rework team. This cross-functional approach can help teams proactively identify and address problematic process trends and lead to more effective resolutions in a way not possible with siloed teams.
Physicians, too, need to be educated about the importance of accurate, timely documentation in preventing denials.
Future trends in collaborative denial management
New technologies like artificial intelligence (AI), robotic process automation (RPA), machine learning (ML), and other automation technologies can help prevent denials on the front end and streamline denial rework on the back end. Leveraging them across revenue cycle teams can provide in-depth root-cause analysis to help organizations identify where denials originate and what corrective action should be taken to prevent them in the future.
RPA is particularly beneficial in helping prevent denials by automating much of the coding and billing processes. RPA works by mimicking human tasks through rules-based actions, allowing the technology to perform transactions and complete repetitive processes without human intervention. The technology reduces errors that often occur through manual data entry and can flag when data is missing or does not match specific criteria. This can help prevent rejected and denied claims.
Automation technology can also proactively identify requirements for prior authorizations and the need for additional documentation, which can reduce delays in care and delayed reimbursement, in addition to reducing denials. On the back end, these technologies can be used to prioritize denials and determine what steps must be taken to ensure a successful appeal. They can also automate the actual appeals process, especially for bulk denials from a single payer.
Building a collaborative future for improved revenue cycle performance
Denied claims have become a growing concern for revenue cycle leaders, many of whom say they are a top concern. This is understandable based on the costly rework required to appeal a denial, estimated at up to $181 per appeal. This is why so many organizations choose to work only the highest-value denials. However, this approach leaves much-needed smaller amounts on the table—amounts that can add up over time.
Leveraging technology across multiple revenue cycle teams can help break down silos and improve cross-team collaboration. They can also enhance productivity without adding additional staff and, in many cases, enable existing staff to be reassigned to more strategic tasks like escalation.
The combination of technology and cross-functional collaboration allows providers to address denials and achieve optimal revenue performance.
Photo: 9amstock, Getty Images
