WHY MEDICARE CLAIM DENIALS HAPPEN AND HOW TO FIX THEM DON’T PANIC; DON’T GIVE UP
If you’ve ever received a medical bill that doesn’t seem right, you’re not alone. Many people call us when they have billing problems. However, as insurance agents, we don’t actually handle bills. That’s the responsibility of the insurance company (the payer) and the doctor or hospital (the provider). Since our clients know us but don’t know anyone at the insurance company, we get the call instead. Imagine going to the doctor, getting the care you need, and assuming your Medicare plan will cover it. But weeks later, a letter arrives: Your claim was denied. Now, you have to figure out why — and whether you have to pay the bill yourself. Unfortunately, all medical claim denials are becoming more common. Every year, insurance companies process billions of claims, but 5%–10% get denied. Some ACA Marketplace plans reject nearly 20% of claims. A recent study found that 73% of hospital billing staff say claim denials are increasing, compared to the 22% in 2022. Denied claims don’t just cause stress for patients. Hospitals and clinics also struggle, spending about $20 billion every year trying to fix these errors — many of which should have been approved in the first place. The good news? Most medical claim denials and Medicare claim denials happen because of simple mistakes. By understanding why claims get denied and how to fix them, you can avoid unnecessary stress and unexpected medical bills. COMMON REASONS FOR MEDICARE CLAIM DENIALS When Medicare or an insurance company denies a claim, they use denial codes to explain why. These codes help hospitals, doctors, and patients figure out what went wrong. Here are five of the most common reasons for Medicare claim denials. 1. Missing or Incorrect Information (CO-4, CO-16, CO-15) • Example: The claim is missing important details, such as a required code or an authorization number. • Solution: Double-check all details before submitting the claim. 2. Diagnosis or Procedure Code Errors (CO-11, CO-50, CO-167) • Example: The diagnosis doesn’t match the procedure, or Medicare doesn’t cover the diagnosis. • Solution: Make sure medical records clearly explain why the treatment was needed. 3. Lack of Prior Authorization (CO-15) • Example: Some treatments require prior approval before they can be performed. If this step is skipped, the claim will be denied. • Solution: Always confirm that Medicare or your insurance plan has approved the procedure before moving forward.
4. Late or Duplicate Claims (CO-18, CO-29, CO-97) • Example: The doctor’s office sends the same claim twice or submits it too late. • Solution: Keep track of claims and submit them on time. 5. Coordination of Benefits Issues (CO-22) • Example: If a patient has multiple insurance plans, the claim might go to the wrong one first. • Solution: Make sure the correct insurance is billed first. HOW TO FIX MEDICARE CLAIM DENIALS If your Medicare claim is denied, don’t panic! Most denials happen because of small mistakes that can be corrected. Here’s what you can do. 1. Find Out the Reason Carefully read the denial letter. It will include a code or explanation. If you don’t understand it, call your doctor’s office or Medicare to ask for clarification. 2. Correct and Resubmit If the denial was due to missing or incorrect information, ask your doctor’s office to fix the mistake and resubmit the claim. 3. File an Appeal If you believe the denial was unfair, you can file an appeal to have the decision reviewed. Many Medicare claim denials get overturned when patients provide the right information. 4. Keep Good Records Write down whom you speak to and what they say. Keep copies of letters, emails, and any paperwork related to your claim. 5. Be Persistent Medicare and insurance companies count on patients giving up . Don’t let them win! If you believe your claim was wrongly denied, keep fighting until you get the right outcome. TAKE CONTROL OF MEDICARE CLAIM DENIALS Medicare claim denials waste billions of dollars every year and cause patients unnecessary stress. But in most cases, they can be fixed!
If your claim is denied, remember:
• Stay calm: Many denials can be corrected. • Ask questions: Find out why the claim was denied. • Take action: Resubmit the claim or file an appeal. By understanding why Medicare claim denials happen and taking steps to prevent and correct them, you can avoid surprise medical bills and make sure your health care is covered.
2 • OmahaInsuranceSolutions.com
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