The following is a guest article by Jennifer Miecznikoski, VP of Revenue Cycle Operations at Accuity

To mitigate the growing burden of payer denials, DRG downgrades, requests for information, audits, and takebacks, hospitals and health systems need to shift back to playing a stronger offense instead of defense.

Faced with surging payer reimbursement challenges, hospitals and health systems are finding it necessary to expand their denials management efforts. The result is a financial drain: Hospitals spent $57.23 per claim on additional administrative and workforce costs to fight denials and other adjudication issues in 2023, according to Premier Inc.

By bolstering their strategy and processes for preempting and minimizing payer claims challenges in the first place, health systems will accelerate cash flow, increase net revenue, and improve overall financial health.

There is nothing that can completely eliminate payer denials, with AI technology driving increases. But the right mid-revenue cycle approach reduces claims underpayments and streamlines the appeals process to increase the likelihood of first-level overturns.

Hospitals and health systems can succeed at improving their revenue cycle efforts and optimizing initial claims submissions and reimbursements by taking full advantage of technology, secondary pre-bill chart reviews, data and analytics, and targeted physician education. These key elements can create a virtuous process that continuously improves the critical mid-revenue cycle and total reimbursements.

1. Leverage Technology, Including AI

There are AI enhancements that can assist in finding gaps in provider documentation, improving accuracy prior to claim submission, further protecting the claim from potential underpayments, and providing an accurate clinical picture.

• Natural Language Processing

In part, this type of machine learning is fighting fire with fire because payers are using AI to detect inconsistencies in medical record documentation and coding. By running unstructured and structured medical record data through an NLP engine, this tool can pinpoint diagnoses and whether they are clinically supported in the medical record. Health systems can then follow up to confirm the chart contains pertinent clinical criteria for certain diagnoses, such as sepsis.

• EHRs Alerts

Because physicians are using EHRs multiple times a day, hospitals can further leverage this system to support documentation in real-time. When designed appropriately, alerts can prompt physicians to record complete care as they enter diagnoses, place orders, receive lab results, and make other changes to a patient’s chart.

• CDI Software for Physicians

Integrated into the EHR and EHR alerts, the software can make real-time suggestions and show clinical criteria and coding guidelines to help with physician documentation. Some software can identify errors and suggest improvements, too.

2. Incorporate Physician-led Secondary Chart Reviews

For all of the impressive progress and potential of AI and other technology, humans are and will remain essential to the clinical documentation and coding process. In all cases, health systems should treat technology-driven results as helpful first steps.

But all such documentation needs oversight, review, and signoff by physicians or other medically knowledgeable experts. A successful end-to-end revenue cycle process includes physicians in documentation improvement initiatives.

Resource constraints and staffing issues may prevent a 100 percent review of all concurrent inpatient charts, so reviews could focus on Medicare cases, and as an example, certain payers or service-specific.

3. Payer Contracting

It is important to review payer contracting and transmittals sent intermittently that update clinical criteria and other contract language potentially impacting reimbursement. Revenue cycle and contracting teams will need to coordinate to avoid department disconnects on these matters.

4. Data and Analytics

To address DRG downgrades, providers should conduct multi-faceted root cause analyses by diagnosis, payer, and other pertinent data. Some EHR systems have effective denial workflows to facilitate access to this data.

The results can enable providers to:

• Limit the number of patient records audited
• Respond more effectively to denials and other payer challenges
• Secure more favorable payer contract terms
• Provides trending for payer/physician/diagnoses

Through data analysis, a health system identified that 80% of its DRG downgrade denials were from one payer. It developed a claims strategy to decrease denials with this payer while providing critical information to shape new terms during contract renewal.

5. Deliver Targeted Physician Education to Enhance Clinical Documentation

Most denials are related to clinical validation rather than coding issues, so improving physician documentation is critical. Currently, physician education about documentation can be challenging.

Best practice is peer-to-peer physician education. Hospitals can use a standing physician service line and medical staff meetings to provide targeted education, using specific examples, about DRGs, payers, or other problem areas.

Clinical documentation, coding, and claims submissions are highly complex and dynamic. A proactive approach to leveraging technology, physician chart reviews, data analytics, and physician education in the end-to-end revenue cycle can significantly improve effectiveness at each critical step. The benefits: timely and full reimbursement for the care provided, accelerating cash flow, and increasing total revenue.

About Jennifer Miecznikoski

Jennifer Miecznikoski has served as Vice President of Revenue Cycle Operations for Accuity since 2017, where she focuses on improving operational efficiencies and ensuring compliance and quality for provider clients. She’s held RCM and HIM leadership roles at Optum, LifeBridge Health, Trivergent Health Alliance MSO, and University of Maryland Medical Center Midtown Campus.