My Favorite Denial

April 18, 2016

IMG_8720-fewer pixels by Seth Avery, AppRev President and CEO

Everyone has a favorite denial. More specifically, everyone has a favorite Claim Adjustment Reason Code (CARC). You know CARCs…those annoying adjustment codes on your remits. The CARCs are supposed to tell us why Payers value our carefully crafted claim at zero.

I review hundreds of claim and remit figures from hundreds of hospitals every year. You’re jealous, I can tell. My expedition into this deep mine of data does yield a nugget of gold every once in a while.

My current love is CARC #13, “Date of Death Precedes Service.” Sounds like a fatal denial, huh? But it most certainly is not. I have customers who overturn it more than 50% of the time. Not surprisingly, most of the denials are Medicare.

What happened to this unfortunate patient? Were services not provided to them after they passed away? Of course, it’s more likely that the date of service is simply incorrect.

Here’s what I tell my customers about management of all denials, not just the outlandish ones: Regardless of the approach you take to denials management, be sure that each and every denial is clearly identified and has a dedicated staff member assigned to resolving it.

By approaching denials management issue by issue, you will soon see your total and average recovery rising. And who knows? Your career might just rise along with it.

ICD-10 Aftermath: How did your hospital fare?

February 16, 2016

We’ve made it through the first three months of ICD-10. How is your organization doing? Did lighting strike? Did the ground open up and swallow your hospital or practice? Probably not. But you did experience some sort of change, some growing pains, and most likely you surprised yourself with how smoothly almost everything else went.

What changed? We want to know how. AppRev is conducting a post ICD-10 Implementation Study to take a look back at six crucial months of data: the last three months under ICD-9 compared to the first three months under ICD-10. We’ve received some data so far, but there’s always room for more. The more, the merrier, in fact!

From you, all we need is a small amount of data entered into a simple spreadsheet. We’ll do the rest – from analysis and comparison to organizing and publishing the results. AppRev will announce the results of the study at HFMA Region 5’s Annual Dixie Institute on March 21, 2016, in Nashville, then the results will be released to the general public through ICD-10 Monitor’s Talk Ten Tuesday podcast on March 22, 2016. Afterward, the complete results will be made available during AppRev webinars, at HFMA conferences, on our website at and upon request. Want a copy of the results? No problem. Just ask and we’ll send them your way.

(Please note: No hospital or practice names will be published. We know you value the integrity of your organization’s privacy and security. All information will remain confidential. We’re just interested in the numbers and trends).

So, exactly what information are we looking for?

We’re gathering the following Key Metrics:

  • Days Cash on Hand
  • Discharged Not Final Billed (DNFB) in Charges
  • Net Days in A/R.

Regarding Denial data, we’ll be collecting the following:

  • Initial Denial Rate
  • Authorization – Percentage of Initial Denials
  • Authorization – Number of Denials
  • Medical Necessity – Percentage of Denials
  • Medical Necessity – Number of Denials

Would you like to see how your organization’s performance compares to the experiences of a larger group? Then join the party! This is an opportunity to be a part of something that no one else is doing. There will only be one ICD-10 transition.

Have any questions or want further information? Please contact us. We’ll be happy to talk to you about the study and our plans for use and distribution of the data. See complete details (including a download of the spreadsheet) here:

We’re looking forward to meeting you and seeing how things have played out for your organization under ICD-10!




Solutions for Bundled Payments

October 5, 2011

With Centers for Medicare and Medicaid Service’s continued interest in the creation of bundled payment system, providers will be at increasing risk of unanticipated impact.  The Bundled Payments for Care Improvement initiative is an attempt to improve quality and reduce cost by providing a single payment for multiple providers within one episode of care.  The goal of improved coordination between hospitals and physicians is expected to be realized by aligning the financial outcome for the two groups.

Providers interested in such initiatives may also wish to create a pricing strategy to take advantage of the new reimbursement terms.  Although this may be a wise course, providers should consider the potential impact on all payers’ reimbursements.  As long as the hospital fee structure ties to one price for each service, changes in strategy will impact all payers.  The ability to model and develop strategies around all payers is critical to the success of such initiatives.  At Applied Revenue Analytics,  we are able to model such strategies with unparalleled accuracy.

Historically, a hospital’s success has had little to do with the ability to develop a pricing strategy.  With the introduction of episode-based reimbursement, there is an opportunity to design a pricing strategy around such episodes.  Hospitals have spent much time understanding what they will “accept “ in managed care agreements, but little time on what pricing can do to the competitive landscape.  What if a hospital could develop one set of prices, to all payers including self pay, for endoscopy procedures?   Would that change the marketing process for that hospital?  The ability to accurately calculate the change in net and gross revenue for various strategies becomes paramount to the deployment of those strategies.  Factors such as volume of the current mix of services by payer and their associated payment terms must be considered.  Our hypothetical endoscopy usually involves services from at least five different clinical departments.  Professional services could also be put in the mix.

Bundling of services offers providers and payers an opportunity to transform healthcare, service by service, from a customized product built one by one to a uniform quality service with predicable financial and quality outcomes.

Written by: Seth Avery, Chief Executive Officer

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