Recently, in auditing accounts, I have seen a frustrating trend of claims being denied because staff obtained an authorization for the incorrect level of care. For a large number or accounts, authorization for observation services had been obtained, but inpatient services were ultimately provided and billed, thus rendering the authorizations useless. The various commercial payers were naturally denying these claims for missing/no/insufficient authorization because it did not match the level of care billed. Appealing these accounts has caused an unnecessary and lengthy delay on getting the proper reimbursement, and many accounts have been written off completely.
The issue does not lie with coders or billers as they must code and bill for the actual services rendered. Utilization review staff must not only obtain the correct authorization for services, they have to follow the patient’s entire care plan and retrieve updated authorizations when the care plan changes. Not doing this makes the original authorization unusable, and the claim will be denied when the actual services rendered are billed with the old authorization.
If staff finds that an authorization has been secured for outpatient services but inpatient services are necessary, it is important to request the authorization for the change. Doing this on the front end makes it more likely that the payer will pay for the services rendered and reduces the amount of work necessary on the back end by erasing the need for retro authorization.
Other authorization issues arise when staff believe that no authorization is necessary for a particular service when, in fact, it is. It is useful to build alerts into your EHR system to flag services that typically require authorization so that staff does not miss this crucial step. Staff can also make sure they are correct by utilizing payers’ online systems to verify what is needed, calling payers, and if time permits, reviewing which services are being denied for no authorization. If a service that staff believes does not need an authorization is getting denied often, it is important to look into the issue and call the payer to determine the reason for the denials.
Finally, staff should proactively pursue authorizations for patients staying on site for multiple days. Securing an authorization for only a portion of the days the patient received services will cause a denial for the unauthorized days, requiring an appeal and extending the life of the claim.
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