Denials Management

4 ways to keep ahead of denials amid the pandemic

February 22, 2021 8:15 pm
Richard Madison

Revenue cycle leaders share approaches to keeping up with new codes and evolving payment guidelines during COVID-19.

Understanding all that’s required to secure healthcare payment during a pandemic — especially for services related to COVID-19 — demanded that revenue cycle teams quickly refine denials management processes to protect their organization’s financial health. It also necessitated a spirit of patience and understanding toward payers, which faced a similar learning curve, according to Richard Madison, network vice president for St. Luke’s University Health Network in Bethlehem, Pennsylvania.

“It takes two parties to get this right,” Madison said.

While Madison and his peers encountered many obstacles that have complicated the task of denials management — including adapting to the needs of a remote workforce and dealing with the uncertainties surrounding payment for an unprecedented volume of telehealth services — their experiences also point to key factors in protecting revenue cycle performance during a crisis.

Revising early expectations

When the world changed in March 2020 with the emergence of the coronavirus in the United States, revenue cycle leaders at Sharp HealthCare in San Diego thought they could take advantage of reduced volumes to strengthen days in accounts receivable (A/R).

Gerilynn Sevenikar

“The message at that time was that payers were ready to support providers during the pandemic and ensure cash flow, so we had strategic discussions around ways to come out of the pandemic with squeaky-clean and current A/R, resolve older claims and make the best use of reduced claim volume,” said Gerilynn Sevenikar, vice president, revenue cycle, Sharp HealthCare. 

However, as both hospitals and payers quickly shifted to a remote work environment, rather than experiencing a reduction in aging claims, delays in claim adjudication became common. Teams on both ends struggled to get used to the “new normal” of working from home. For Sharp HealthCare and other hospitals and systems, revenue cycle staff  were challenged by the speed with which new rules for telehealth billing and new codes related to COVID-19 and virtual care were introduced. Without an agile response, payment for care and services delivered could quickly become at risk.

“What is it they say about best-laid plans? They often go awry!” Sevenikar said. 

“I don’t think any of us expected the pandemic to last as long as it has or to have a continued  progressive impact like we’ve seen over the past year. We found payers were less willing to try to resolve older claims in this environment. Meanwhile, for our staff, there was added complexity to claim processing resulting from the need to manage the billing requirements for hospital-delivered telehealth services, interpret various coverage requirements and ensure that patients were not balance-billed for COVID-19 tests when a payer adjudicated patient responsibility. And all this, too, led to an increase in aging claims.”

As hospital revenue cycle teams navigated a changing environment, they also had to determine the keys to maintaining stability in operations, reducing the risk of denials and protecting cash flow during year one of COVID-19. Revenue cycle leaders for three health systems share their experiences and lessons learned in four areas.

Pinpointing the most at-risk areas

While some of the organizations interviewed say they have not experienced a rise in denials, all have faced issues that put payment at risk during the pandemic. 

“At Sharp HealthCare, we continue to see some plans denying COVID tests if a test comes back negative or interpreting screening as ‘not medically necessary’ when a negative result is recorded,” Sevenikar said. “We also have some payers that want emergency department [ED] patients to go to a contracted laboratory for COVID testing versus having the test performed in the ED.” 

Other issues Sharp HealthCare continues to experience include:

  • Denials for readmissions in which payers are applying CMS readmission criteria to non-Medicare visits, causing rework and payment delays
  • Appeals for COVID-19 testing claims where the insurance company has allocated a cost-sharing amount to the patient, despite federal guidelines stating that medically necessary COVID-19 tests must be covered by insurance

For all the health systems whose leaders we interviewed, introduction of new codes for COVID-19-related services, changing payer rules — including around telehealth — and difficulties keeping track of varying payer requirements introduced a new level of intricacy to claim processing.

At St. Luke’s, staff proactively screen COVID-19-related claims prior to claim submission to avoid denials. Madison noted the health network also refined the organization’s denials processes by “testing” how payers would respond to the toughest types of claims, submitting just a few so that the team could adjust its approach, if needed, before filing more. Staff also were assigned to manage COVID-19-related claims for uninsured, undocumented patients.

“It’s not like we’re getting through some of these claims quickly — we have a backlog of accounts that are sitting in a work queue, pending review,” Madison said. “But as the payer rules change, this helps us to avoid denials on a larger scale.” 

Other processes that have worked well for St. Luke’s include establishing a team to screen all COVID-related claims prior to submission, and creating Epic work queues to separate COVID insured and uninsured claims 

“This approach enables team members to take a closer look at COVID-19 testing claims to ensure the diagnosis codes to support these tests are present and that payer-specific requirements are met,” Madison said.

The surge in virtual care visits — from telehealth, which has a virtual or audio component, to e-visits, which may take place via secure text — also required hospitals and systems to pay careful attention to the types of virtual care covered by payers and new codes released at a “blink-and-you’ll-miss-them” rate. It also continues to necessitate close coordination with IT teams to build edits into claim processing systems based on payer responses to claims. 

Initially, St. Luke’s experienced a significant rise in telehealth denials, which Madison attributes to the sheer volume of visits performed. “Our telehealth visits rose 2,500% in 2020,” he says. “We did have to address denials, especially on the physician side, because the flow of claims was so much faster, the mechanisms for reviewing those claims more closely were not yet in place and payer requirements kept changing.” 

Sharp HealthCare also faced initial challenges. 

“With the introduction of new codes for COVID- 19-related services — from COVID testing to pharmaceuticals like Remdesivir, telehealth, related symptoms and newly established  DRGs — it’s not unusual for us to be working a denial because our coding processes and systems need to be updated,” Sevenikar said. “We held claims for hospital-based telehealth visits for over three months until we could figure out, ‘How do we bill this book of business correctly?’”

At BJC HealthCare in St. Louis, a heavier emphasis on coding audits has helped in staying ahead of COVID-19 denials. 

“We audited telehealth and COVID-19 claims so that when changes went into effect, we could stay on top of them and retrain coders based on the results of what we were seeing,” said Deb Wierciak, executive director, revenue cycle management, for BJC HealthCare. “It took time to get our arms around this, but that’s not surprising, given the natural progression of this disease. Our virtual training mechanisms helped a great deal in bringing coders and staff up to speed quickly.”

Strengthening communication among teams

The shift to a remote work environment, much like the rise in telehealth care, happened at a breakneck pace in March 2020, when it became clear that the nation was in the midst of a pandemic. For health systems, that meant remote revenue cycle processes had not been fine-tuned across functions, presenting challenges for areas such as customer service and claim processing.  

“We worked overtime to refine our work-from-home queues and approaches,” said Tracy Berry, vice president and chief revenue cycle officer for BJC HealthCare. “For employees who work with customers by phone, technology adjustments were made to ensure that we could monitor our call centers and make adjustments as needed. We also implemented staff huddles as frequently as daily, when needed, but typically two to three times per week.”

Before COVID-19, 500 revenue cycle employees — primarily coders — for BJC HealthCare worked from home, after three years of careful preparation. Once the coronavirus hit, the need to move the remaining revenue cycle staff to a remote model happened very quickly: “I tell people, ‘It took us about three years to transition 500 people to remote work, and it took just 10 days to send the next 500 home,’” Berry said. “We were lucky to have a strong foundation to build upon. We used Microsoft Teams to connect with our remote staff prior to the pandemic. Now, all of our staff have access to this technology. That’s been a big enabler to our success during the pandemic.”

At Sharp HealthCare, where leaders anticipate maintaining a hybrid staffing model (part in-office, part remote) once the pandemic is over, leaders also concentrate on employee engagement and recognition. 

“It’s really important that revenue cycle employees know they are supported and appreciated,” Sevenikar said. “It’s also critical to maintain the organization’s culture in a remote working relationship. 

“It’s so easy to lose sight of culture when your team is not physically together. We’ve provided training for revenue cycle leaders on how to manage remote staff so that employees are engaged, leaders offer effective support, and employees still feel as though they are part of one team and that they share information with each other regularly, just as they would if they were sitting next to each other.”

Proactively managing relationships with payers

An organization’s ability to identify changes to payer rules around COVID-19 and telehealth claims, in real time, and keep staff informed on the variances in billing rules by payer is essential to denials prevention during COVID-19. Early into the pandemic, Sharp HealthCare created a matrix that included:

  • The billing criteria for COVID-19 and telehealth claims, by payer and by service line
  • The amount that the health system anticipated it would receive by payer for specific services
  • The actual payment received, so leaders could keep track of variances and follow up with payers 

“Probably the most important thing we’ve done during the pandemic is to stay connected with our payers, be clear about our expectations and follow up quickly — within a month of payment — if the amount received differs from what we expected,” Sevenikar said. “We’ve learned a great deal through this process. For example, some payers will not cover a hospital-based telehealth visit, which might range from a visit with an oncologist to genetic counseling or therapies that can be conducted virtually. Since this is a new service offering, it’s important to understand these coverage limitations before a visit takes place so that claims aren’t denied, and patients don’t experience higher out-of-pocket costs.”

For Madison, realizing that payers, too, were struggling with how to manage COVID-19 claims was an important lesson. “When the message came from the government that no one would be responsible for paying for COVID-19 testing, payers’ systems weren’t set up to identify which COVID-19 claims should not involve cost sharing,” he said. “There was just a lot of confusion around it.” 

When patients are assessed a copay for COVID-19-related services, Madison’s team at St. Luke’s works collaboratively with payers to process those claims on behalf of patients. 

Increasing payment flexibility for patients

During COVID-19, health systems also ramped up patient payment options — from self-service options to payment plan offerings — to ease consumers’ financial fears exacerbated by the pandemic. Just as denials prevention and payer relationship management helped protect dollars at risk, so did efforts to break through consumer misconceptions regarding whether they could afford care in a post-COVID environment. 

“One of the approaches our organization has deployed during the pandemic is the use of online, self-serve installment plans to give consumers greater options in paying for their care from our website,” Sevenikar said. At Sharp HealthCare, which previously had an internal payment plan for short-term balances (12 months or less), an in-house development team created the mechanism for patients to enroll in a financing plan online within three months of  
receiving care. 

“When this launched, we could see the impact on self-pay collections immediately,” Sevenikar said. Today, nearly $1.5 million is tied to internal payment plans, and about 70% of patients who have enrolled in these plans have made initial payments toward their balance.

Increased emphasis on self-service options for account management, including bill payment, also made it easier to engage consumers in paying for their care.

“Coincidentally, we had plans to implement a new patient liability tool prior to the pandemic to make it easier for patients to self-service their accounts,” BJC HealthCare’s Wierciak said. 

The tool went live during the pandemic, and although the health system could not definitively say it and other online options have increased self-pay payments, there was reason to believe it helped mitigate the pandemic’s impact: “We haven’t seen declines during the pandemic that we might have expected,” Wierciak said. “The tool helps us make the interaction easier to understand, which facilitates payment.” 

Meanwhile, at St. Luke’s, use of text-based reminders has been effective in encouraging consumers to pay their out-of-pocket balance, while also being vital in keeping COVID-19 vaccination appointments top of mind.

Avoiding pandemic-related payment predicaments

As these organizations’ experiences demonstrate, taking proactive steps to reduce denials and payment delays in the early stages of a crisis better positions hospitals and health systems to weather financial volatility. 

“In the past two months, we’ve been very busy, and we have a strong cash position to show for it,” Sevenikar said. “Staying connected with payers and consumers and making revenue cycle teams feel supported and appreciated have given us an edge in avoiding preventable denials throughout the pandemic.” 

Expanding patient payment flexibility at Sharp HealthCare

During COVID-19, Sharp HealthCare saw an increase in requests for payment plans from patients, and then realized these results:

  • 888 consumers enrolled in payment plans.
  • $1,440,114 in healthcare accounts is tied to payment plans.
  • 69.2% of patients made initial payments to plans.
  • 60.6% of patients chose the maximum number of installment payments.


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