Claim Denials Becoming More of a Headache for Providers: Report

Modern Healthcare | By Caroline Hudson
 
Insurance claim denials continue to be a vexing problem for healthcare providers, forcing them to expend more resources to reverse payers' decisions in an already-inflated cost environment.
 
One common approach among insurers is denying payment until the provider submits additional information. Payers say it's a way to ensure their dollars are being spent appropriately, but many providers argue it's a stalling tactic. 
 
Requests for more information are a growing burden on providers, but some payer programs are worse than others, according to a report published Thursday by consulting firm Kodiak Solutions. 
 
Kodiak’s quarterly benchmarking report examines data from the company's revenue cycle analytics platform, which is used by more than 1,900 hospitals and 250,000 physicians. The report categorizes any initial claim rejected pending more information as a denial.
Here are five takeaways from the report.
 
1. Payers are increasingly asking for more information.
 
Payers initially denied 3.8% of billed charges in the first five months of 2024 requesting more information. Monthly data showed an uptick to 4% in May, from 3.9% in January.
Payers often ask for medical records confirming the level of care was appropriate, including itemized statements of the charges and details on coordination of benefits, said Matt Szaflarski, revenue cycle intelligence leader at Kodiak.
 
"Providers have tried to figure out ways to be proactive about sending medical records with the first claim ... but oftentimes payer systems aren't set up to accept those records until the claim is denied," Szaflarski said.
 
2. Providers burdened with higher administrative costs.
 
Providers face rising administrative costs for staffing and other resources needed to handle requests for more information and to follow up with patients when a claim or parts or it are denied.
 
Providers spent $1.9 billion in the first five months of 2024 responding to requests for more information, the report found, compared with $1.7 billion for the same period in 2023 and 
$1.5 billion in 2022.
 
Kodiak projects providers will spend nearly $4.6 billion for the full year. Comparative numbers for 2023 were not included in the report.
 
3. Provider claims aren’t necessarily getting sloppy.
 
Most claims initially denied pending additional nformation end up being approved.
Kodiak assessed more than 39,000 initial claim denials at five unnamed health systems in 2023 and found that insurers eventually paid 88.4% of those claims once more information was provided. 
 
Szaflarski noted that even if claims are ultimately paid, many of those payments have been delayed for months.
 
4. Providers see more denials on inpatient claims.
 
From January through May, payers initially denied 4.5% of inpatient billed charges, compared with 3% of outpatient charges. Full-year data for 2023 followed a similar pattern, with payers denying 4.3% of inpatient billed charges and 2.9% of outpatient charges.
"The inpatient cases are the ones that have the highest levels of reimbursement, and so that's where there's a lot more due diligence," Szaflarski said.
 
He said many denials are related to sepsis cases because payers and providers often dispute the criteria and coding for a sepsis diagnosis.
 
5. Medicaid and commercial payers issue the most denials. 
 
Traditional Medicaid programs initially denied 9.2% of billed charges in the first five months of 2024. Szaflarski said the trend could be related to constantly changing Medicaid rules and multistate providers dealing with different rules in different states. Medicaid patients also tend to move in and out of those programs more frequently, he said.
Commercial payers initially denied 8.1% of billed charges from January through May.
 
"It's the commercial bucket that has just become more and more challenging and especially as Medicare beneficiaries have moved over to the commercial space," Szaflarski said.
 
Medicaid managed care programs initially denied 5.5% of billed charges, and Medicare Advantage programs denied 2.7%, according to the report. Traditional Medicare programs initially denied 0.5% of billed charges.

Rural Seniors Seeking to Age in Place Grapple with a Shortage of Home Care Workers

Housing Wire | Chris Clow
 
Rural parts of the U.S. have roughly 35% fewer home health aides to assist their aging populations than urban areas do.
 
This is according to research from the University of Minnesota as cited by the Population Reference Bureau (PRB), a private nonprofit research organization that receives funding from the U.S. Census Bureau. Researchers found that rural areas average 32.8 home health aides per 1,000 older adults, while urban areas average 50.4 of these workers per 1,000 older adults.
 
Rural parts of the country not only have higher concentrations of older citizens, but they lack the professionals that will be needed to help these older adults age in place in their homes according to a July report from the PRB.
 
“Further, rural areas have just 20.9 nursing assistants per 1,000 older adults compared with 25.3 in urban areas — a 17% gap,” the report stated. “These differences underscore geographic inequities in the availability of care, which may constrain who is able to age in place.”
 
The researchers have several potential explanations for the gap, including lower wages, job quality issues and a lack of investment “in the direct care workforce, such as job training programs and financial incentives for workers.”
 
The degree to which the population is aging has also played a role in the availability of care, since some regions have higher numbers of older residents than others.
 
“Regionally, New England, home to some of the oldest states in the country, has among the lowest ratios of home health aides and nursing assistants — in both rural and urban areas,” the report explained. Co-authors of the original research attribute this to “population demographics” which are “driving their direct workforce supply.”
 
Some states have initiated efforts to increase the size of the direct care workforce to address these kinds of shortages, including “wage increases, health insurance options, and free and accessible training,” the report explained.
 
The lack of a direct workforce supply has resulted in friends and family members of older residents in these parts of the country aiming to fill in the gap.
 
“The United States has experienced profound demographic changes — in marriage, partnering, fertility and family size, stepfamilies, and kinlessness,” the report said. “These trends affect the number and type of family members who can care for Americans as they age.”

Dying Is Not Pretty

By Barbara Karnes, RN

I get emails weekly from upset caregivers and family members who had hospice services. Now that mom is dead they are angry with hospice. It is the hospice's fault that mom died. "Hospice killed my mom."

My first response is that hospice did not educate enough, interact with caregivers enough, teach enough — and that is partially true. Time spent with families talking and teaching brings a better understanding of what is happening and what will happen.

Education is 90% of what we do when working with end of life situations. When we explain before death approaches and, if you can be present, even as death is occurring, then lack of understanding will not turn into fear and anger because death occurred.

Another area to consider: I’m not going to say hospice did or did not kill mom. I don’t know the details of mom’s dying. BUT I am going to say mom was on hospice service because she was dying. Hospice takes care of people who are dying. If it is an appropriate referral, mom will die while on service. 

That is what hospice does — takes care of the dying until death comes. What’s not to understand here? Mom will die while getting hospice care. 

I wonder if it isn't in part how mom looked when she was dying that creates the accusations. People don’t die like they do in the movies. Mom is not going to say some profound words, close her eyes and be dead. Dying is not pretty. It is messy. It is scary. It often looks torturous and unnatural. 

The thing is, it is natural. That is how people die. Sometimes when death comes, it is gentle and appears peaceful. But most of the time it is laborious, long and certainly not pretty. There is generally a "struggle" to get out of our body. Hospice often provides medications (sometimes morphine) to relax and ease the labor, the struggle. Mom relaxes and dies.  Then “Hospice killed my mom.”

How Olympic Success Can Offer Leadership Lessons

CEO Magazine | By Craig Johns

As the Paris 2024 Olympic Games wrap up, the extraordinary performances of athletes offer valuable insights into leadership. High performance in both arenas hinges on precision, focus and constant improvement – lessons that can transform leadership strategies and drive success.

With the Paris 2024 Olympics coming to a close and many athletes having the performance of their careers, what can this teach us about leadership?

I believe that what leadership and athletes have in common is high performance, but what most people describe as high-performance habits is in fact just strong performance consistently achieved.

But high performance isn’t just finishing the race by applying the basics well. It’s also about improving the precision, performance and focus required to increase efficiency, improve success and keep things error-free. And we can learn the same when it comes to leadership lessons.

As a 10-times national sports champion and New Zealand national level hockey player, these are the four areas I know high performance athletes excel at and review constantly.

Energy management

Energy management is an athlete’s number one currency. And just like athletes, CEOs and leadership teams need stamina, precision and focus and to manage high performing teams.

It starts with applying the four fundamentals required for high performance: exercise daily; fuel your body with the right food; free your mind; and recover with purpose.

Good leaders must also schedule recovery time from the daily demands of their roles, and that includes being an example to your team in how you take your leave.

In sport, high-performance athletes are meticulous in their approach to energy management. They schedule their energy and recovery on a daily, weekly, monthly, yearly and career basis to sustain high performance and inner drive.

Good leaders must also schedule recovery time from the daily demands of their roles, and that includes being an example to your team in how you take your leave.

Mindset

High performers are known for their productivity, precision, drive and focus.

It starts with a clarity of vision. When Michael Phelps was eight years old, he visualized standing on the Olympic podium with a gold medal around his neck. As a 19-year-old, in Athens in 2004, Phelps won six gold and two bronze.

When you have clarity of your vision, you say no instead of yes.

A high-performing leader or CEO also needs to be adaptable to changing conditions.

You say no to everyone who will prevent you from achieving your goal. No to chocolate, alcohol, late nights. You naturally form a disciplined mind. We know that complacency and lack of drive leads to errors and mistakes. So… what’s your vision?

A high performing leader or CEO also needs to be adaptable to changing conditions. It’s like a Tour de France rider dealing with changing terrain, road surfaces and weather conditions. A disciplined mind needs both focus and adaptability.

What can you control? How can you provide a safe and error-free environment? As a triathlete and cyclist, I always ensured that my equipment was maintained because a tire blowout, faulty brake, loose pedal or a dry chain could be catastrophic.

Teamwork

Teamwork in sport can be a matter of life or death, and teamwork in business is vital to your success.

Like a Formula One pit‐stop crew, how can you work as a single unit to perform a complex task under pressure with minimal error? Meticulous planning, checklists, tight feedback loops, practice and communication are required to deliver.

High-performance athletes have a tight feedback loop they apply to their performance. They are always focused on how they can receive high-quality feedback in real time.

I was fortunate to be part of one of New Zealand’s best sports team in the 1990s – the Stratford Premiere Men’s Field Hockey Team who went unbeaten for 272 games. That’s right, 16 years without a loss. It might be a world record unbeaten sports streak. What’s even more impressive is the team only lost once in 21 years.

To deliver sustainable high performance over a long period of time this team had:

1. Vision: A positive vision based around quality of performance and a minimum level the team will accept.

2. Ecosystem versus Ego-system: A team mindset focused on lifting both self-worth and the collective worth of the team.

3. Discipline: Knew their role, when to lead and when to follow.

4. United: Created permission to feel the courage to have honest conversations promptly and quickly.

Performance monitoring

The biggest difference between sport and business is the level of performance monitoring.

High-performance athletes have a tight feedback loop they apply to their performance. They are always focused on how they can receive high-quality feedback in real time. They know that constant growth minimizes success or failure.

CEOs need good support teams who understand their vision and can help them achieve it.

No successful athlete does it on their own. They surround themselves with people and technology who can monitor, tweak and enhance their performance.

And just like Olympic athletes, good leaders and CEOs need good support teams who understand their vision and can help them achieve it.