6 Best Practices for Hospital Denial Management

6 Best Practices for Hospital Denial Management

The healthcare industry is rapidly changing, and hospitals are forced to update their business practices. Today’s hospitals must be agile, adaptable, and dynamic to meet the challenges of tomorrow. One of the most demanding challenges facing hospital administrators is effective denial management. There’s no denying that the volume of denied claims is increasing every year. The cost of bad debt has skyrocketed for many healthcare organizations, but this isn’t necessarily something you have to fear. You can mitigate the risks and increase your organization’s ROI by implementing effective denial management strategies.

1. Always Communicate with Patients Before Discharge

The best way to avoid patient denial management is to ensure your patients understand their responsibilities before leaving the hospital. This can help you avoid many denial management headaches, especially if your patients have questions about how their insurance works. A common issue is that patients may not understand their bills or even know if their insurance paid for the bill. Make sure to walk them through this process and have them sign a financial acknowledgment form to make sure they understand their financial responsibilities. This can help you avoid denials by ensuring that your patients know what they are responsible for and what their insurance covers.

2. Be Organized and Use a Manual Process

When dealing with hundreds of bills daily, it can be easy to overlook a few. The best thing you can do to prevent these denials is to ensure you are organized. Ensure you have a manual process for denials, missing information, and incorrect charges. You don’t want to rely on an EMR system to catch these issues. A manual system will allow you to go back and make corrections that the computer missed or even initiate a hold on the account if the patient cannot pay for the bill.

3. Review Your Denials Constantly

This may sound like an obvious one, but it’s often overlooked. As your hospital denial management rises, review the denials to see if there are any patterns. If there are, take action immediately to correct the problem. This is a good idea for two reasons: The first is that incorrect denials can lead to a drop in your fee-for-service score, which we’ll discuss in the next section. The second reason is that false denials can lead to fines and penalties by your state’s Department of Insurance (DOI).

4. Make Sure You Are Adhering to All of Your SLAs

Most EMRs come with SLAs or Service Level Agreements. These are a set of rules and regulations that the company has set for its EMR. They may tell you how long you have to respond to a request, how long it should take you to add a patient to your system, or a variety of other things. If you are not adhering to your SLAs, you will likely see a rise in denials. Ensure you are following these rules and regulations and that your staff is also. This could be the culprit if you see a rise in denials.

5. Train Staff and Have a Dedicated Denial Management Team

Catching errors before they become denials is one of the best denial management practices. You can do this by training your staff on how to use your EMR correctly and ensuring they are trained on what to look for when reviewing patient bills. The best way to do this is to create a denial management team responsible for finding and correcting errors before they become denials. Make sure your team is looking for a wide variety of things, including incorrect charges, missing information, wrong patient information, missing signatures, and more.

6. Make Sure You Are Using the Right Electronic Medical Record (EMR)

Make sure you are using the suitable EMR for your hospital. There are plenty of factors to consider when choosing the appropriate EMR, but the most essential is your denial management. Some EMRs are designed to be easy to use, and others are designed to be efficient. While an easy-to-use EMR can be helpful, it can also lead to mistakes. A more efficient EMR, on the other hand, can help you catch these mistakes and correct them before they become denials.


The best way to avoid denials is to ensure your patients understand their financial responsibilities before leaving the hospital. You can do this by providing patients know what their insurance covers and what they are responsible for paying. You can also ensure you are organized, use a manual process, and review your denials constantly to find and correct errors before they become denials. Finally, ensure you use the suitable EMR for your hospital to help you manage your denial.




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