Hospital Claim Denials Rising Steadily – Even More During Pandemic

HBI Blog / Hospital Claim Denials Rising Steadily – Even More During Pandemic

The average rate of hospital claim denial continues to rise upwards and an event like COVID-19 has only accelerated the growth, according to a new report.

  • Claim denial from payers is not new. The trend has been rising for quite some time now. However, the recent pandemic has only increased the rate of denials. The average rate of claim denials received by the hospitals has increased by 23 percent in 2020 as compared to four years ago.
  • Claim denials upon initial submission have also surged. It grew from 9 percent in 2016 and 10 percent at the beginning of 2020 to around 11 percent by the third quarter of 2020. All the data have been found after analyzing 102 million hospital claim remits. The analysis consisted of $407 billion in total charges around more than 1,500 hospitals around the country.
hospital claim
  • The analysis suggests that around 86 percent of the claim denials that were processed between July 2019 and June 2020 were potentially avoidable i.e., the hospital staff could have helped prevent the denials. On the contrary, only 14 percent of the claims were unavoidable under any circumstances, and nearly 25 percent of the potentially avoidable denials cannot be recovered.
  • Besides, hospitals witnessed multiple claim denials due to shortcomings that were related to issues like missing or invalid explanation of benefits, services not covered, missing or void claim data like unspecified billing issues.
  • A recent report issued on behalf of AHA confirms that around 89 percent of the hospital leaders experienced increased claim denials over the past few years, and half of them described the increase to be significant. According to the report, claim denials are not only impacting the revenue performance for the hospitals but also the quality and accessibility of patient care.
  • Extended staff education and automation of front-end steps are some of the strategies that can help the hospitals prevent common claim denials including reasons like plan coverage, benefit maximum, and coordination of benefits. Apart from that, advanced technology like artificial intelligence can help healthcare organizations manage claim denials efficiently.

Leave a Reply

Your email address will not be published. Required fields are marked *