Missing Piece Blog

Unforeseen Impacts of Rejected Claims on Your Practice

As a healthcare provider, there are few things more frustrating than your income being impacted by rejected claims. Rejections in medical billing happen for many reasons, and ultimately, the healthcare provider has to take the time to fix the claim and then wait a second time for the claim to be processed. Meanwhile, they have to make do without payment for their services, which can have a negative impact on their practice.

Join us as we unpack what rejected claims are, why they happen, how they’re different from claim denials, and how rejected claims can impact your business.

What is a rejected claim in medical billing?

A rejected claim can occur at the clearing house or the payor because of a problem regarding the information contained in the claim. The claim is returned to the healthcare provider to address the issue.

Are claims rejected for a reason?

There are many different types of rejection in medical billing. Some of the most common claim rejection codes may include: 

  • Incorrect information, such as incorrect National Provider Identifier number, is provided
  • Information, such as a DX code or patient’s DOB, is omitted
  • The claim did not use the correct codes that appear on the Provider contract
  • The order of benefits is incorrect
  • The patient has multiple health insurance plans, and there was an issue with the coordination of benefits.
  • The patient’s coverage has been terminated

These are just some of the reasons that insurance companies can reject claims. Depending on the case and claim, many other reasons can be cited.

Is a rejected claim different from a denied claim?

Yes, there is a difference between rejection and denial of claims in medical billing. 

A rejected claim may require additional information before it can be resubmitted for processing. It can also be rejected due to non-billable DX or provider/group enrollment issues.

A denied claim is one that went through adjudication, also referred to as ABA claims processing, and was not paid. Once a claim is denied, claim management follow-up with insurance is required and may include calling to have the claim reprocessed, disputing the denial on the portal, appealing, or submitting a corrected claim. 

How rejected claims affect your practice

There’s no doubt that even the tiniest of issues can result in a rejected claim, which in turn can have a dramatic impact on your practice. Here are some of the expected and unexpected ways a rejected claim can affect your organization.

Decline in revenue

The most direct consequence of rejected claims is that your practice will generate less revenue until the issue has been resolved. This can affect your practice’s day-to-day operations and your patients’ experience, as you may lack the funds to pay for services.

Increased work for your billing team

Any rejected claim must be fixed and resubmitted once you are familiar with claim rejection reason codes. This means extra work for your billing team as they’ll need to check the claim again and update any information that was incorrect or omitted. 

Additional operational costs

While a rejected claim may not come with any penalties or direct additional costs, it does incur additional operational costs. Where your billing team would have been able to move forward with submitting new claims, these have to be put aside for the moment while the rejected claim is processed a second time. This loss of time increases the running costs of your practice.

Increase in employee frustration

Employees who have to deal directly with denial and appeal management or those who are directly or indirectly affected by the reduction in revenue associated with the processing of rejected claims may find themselves increasingly frustrated with having to redo work.

Partner with a reliable ABA therapy billing service to minimize rejected claims

In order to lower your rejections in medical billing, ensure your claims are processed quickly and easily, and that you can provide reliable income for your ABA practice, you need the right billing provider. Missing Piece has over 10 years of experience providing ABA therapy practices with billing and other important healthcare-related services.

By letting us handle your billing and other aspects of your practice, you’ll have more time for more quality patient care, access to a team of billing experts, and a flexible service that can scale up or down as you require. What’s more, you’ll have improved reimbursement that allows you to run your practice smoothly.

Contact us to find out more about how we can help you with your ABA therapy billing.