Is Your Clinic In Denial?

Feb 5 | , , , , , ,


5 Easy Actions You Can Take Right Now to Drastically Reduce Payor Claim Denials

Carol A. Wilcox

PREFERRED Therapy Providers, Inc.

Is your clinic in denial? Do you submit claims for patient treatments to payors that are returned as denied? Do you want to decrease the number of returned claims and start getting paid instead? This article will provide some simple answers and solutions you can take right now to drastically reduce the number of claim denials in your clinic.


Denied claims mean less money for your business. Yet many private practice healthcare owners leave thousands of dollars on the table each year because they fail to follow up on claim denials or just don’t know how to prevent them in the first place.

Only 35 percent of providers appeal denied claims according to the Medical Group Management Association (MGMA). Claims that have been denied can become a drain on both time and money. MGMA states the average cost to rework a claim is $25. While that might not seem like a lot of money, multiply that amount by the average number of claims you and your staff have to rework every month. This resource realistically demonstrates the potential impact of denials on a clinic’s bottom line.


The American Physical Therapy Association (APTA) states the top 10 payor complaints about reasons for claim denials are:

  1. Poor legibility
  2. Incomplete documentation
  3. Not documentation for date of service
  4. Abbreviations – too many or cannot understand
  5. Documentation does not support the billing (coding)
  6. Does not demonstrate skilled care
  7. Does not support medical necessity
  8. Does not demonstrate progress
  9. Repetitious daily notes showing no change in patient status
  10. Interventions with no clarification of time, frequency or duration

Other common mistakes include entering the wrong claim number or provider ID number, missing ICD-10 codes, G-codes and modifiers and incorrect subscriber or policy holder information.


If you want to reduce the number of denied claims in your business, take a look at your entire clinic operation and not just the billing and coding department. The secret to avoiding claim denials is accurate documentation – from the time the patient enters the clinic to carefully documenting treatment procedures to the time the claim is submitted for payment.

The less documentation you have, the more likely your claims will be denied. It sounds simple and it actually is. All you have to do is set standards and processes in place for your entire staff to adhere to and follow.


STEP 1 – Improve Patient Registration Data – Many errors resulting in claim denials occur during patient registration. Make sure your patient intake forms are easy for the patient to fill out and understand. Fill one out yourself so you’ll know if it’s easy or difficult to complete. Instruct your front office staff to have the patient fill out the forms using a pen – and never a pencil. Train your front office staff to review the form once it’s filled out to make sure that the information provided is legible. Try to make sure the data entry person doesn’t have too many distractions while entering patient information – otherwise, you risk the chance of entering data into your system that is not accurate thus increasing your chances of a claim denial.

STEP 2 – Insurance Eligibility Verification – Train your staff to check the patient’s benefits by looking on the back of the patient’s insurance card and contacting the payor directly. Take the time to verify eligibility of each new patient. Patients revisiting the clinic should be asked if their insurance has changed since their last visit. Along with verifying member benefits, ask the payor what CPT codes they require for evaluation services. Should you find out through verifications that the payor does not recognize the CPT codes, make a call to your payer representative to discuss new codes and fee structure.

Train your staff to document everything including the name of the payor representative they spoke to and the information they provided. Be sure to document the time and date of the conversation. Include any notations, discussions and contact information, eligibility verification reference number, authorization number and all supporting documentation. If your staff is using an online portal, save the web page that provides the benefit information and include it in the patient record. This will help if your claim is denied.

STEP 3 – Document all Treatment – Each provider on your staff should be properly trained in documenting patient treatment. The American Physical Therapy Association recommends the following documentation tips:

  • Limit use of abbreviations
  • Date and sign all entries
  • Document legibly
  • Report functional progress towards goals regularly
  • Document at the time of the visit when possible
  • Clearly identify note types (e.g. progress reports, daily notes)
  • Include all related communications
  • Include missed or cancelled visits
  • Demonstrate skilled care and medical necessity
  • Demonstrate planning throughout for the conclusion of the episode of care
  • Select codes that accurately describe the impairments, activity limitations or participation restrictions that you are treating
  • Use the most specific code that accurately describes the service
  • Know when a modifier is necessary and accepted by the payor

STEP 4 – File Claims Promptly – Be sure your billing staff submits claims in a timely manner. Putting off claim submissions can cost your business because most payors have timelines for submitting claims. If you miss the deadline, you won’t get paid. Train your billing staff to know the filing deadlines of each payor and monitor their adherence to those deadlines. Make sure all required information is included in the claim. A missing Tax ID number, missing clinic address, a missing modifier or the wrong plan number can cause a claim to be denied.

STEP 5 – Avoid Filing a Duplicate Claim – If you don’t receive payment the first time you submit a claim and then file a duplicate claim, the duplicate claim will be denied. This can slow down the entire reimbursement process. If you don’t receive timely payment on a claim, contact the payor representative to find out what steps are required to re-submit an unpaid claim.

Bonus Symbol



 Tip # 1 – When sending claims to payors, be sure to bill under the facility name (TIN) and not the therapist name. Most payors do not load individual therapists to their rosters – only the facilities are loaded. So if you send in a claim using a therapist name instead of your facility name, your claim might be denied.

Tip # 2 – Require a detailed weekly report from your billing staff that monitors claims submitted and any claims that have been denied. It can be as simple as a spreadsheet. By monitoring claims weekly, you’ll quickly be able to spot issues and resolve them promptly. This is also a great practice for helping you manage business revenue.

Tip # 3 – Review documentation standards and practice protocols annually with your entire staff as part of your compliance program education. Communicating your expectations, discussing any roadblocks and collectively solving issues will help to reduce the number of claim denials and set your practice up for profitability.


About the Author:

Carol A. Wilcox is the staff writer and head of marketing communications at PREFERRED Therapy Providers, Inc. You can reach Carol here.

This article is brought to you by PREFERRED Therapy Providers Inc. PREFERRED is the nation’s leading payor management services network. Our expertise is working with physical, occupational and speech therapy practices – from single clinics to multiple clinic locations.