Recent survey and system data are again suggesting that payers’ increasing claims denials are a pain point for healthcare providers.
Nearly three-quarters of the 210 provider revenue cycle leaders surveyed by Experian Health this summer said claim denials are increasing, as opposed to 42% from the revenue cycle technology company’s last survey in 2022.
Two-thirds said reimbursement times are increasing, 55% said errors in claims are increasing and 77% said payers are changing their policies more frequently, according to the survey report released Tuesday. Each of those responses were higher than in 2022.
Thirty-eight percent of the survey respondents told the vendor their claims are denied 10% of the time, with 11% saying the denials came 15% of the time.
Missing or inaccurate data led as the most frequently reported reason for the organization’s claims denials (named as a top three issue by 46% respondents), followed by authorizations (36%) and inaccurate or incomplete patient information (30%). Also listed, though less frequently, were changing payer policies, late submissions and coding errors, per the report.
“We had hoped to see a decrease in claim denials from our previous survey, but it’s clear these significant challenges are continuing, adding immense pressure on providers to improve their revenue cycle management processes,” Clarissa Riggins, chief product officer at Experian Health, said in a release.
Experian’s respondents were also worried over payer reimbursement in a broader sense. Seventy-seven percent said they were at least “moderately” concerned about insurers sending payments while 43% were at least “very” concerned. These respondents often pointed to pre-authorization (60%) and speedy policy changes (51%) as the sources of that concern, per the report.
The sentiments passed along to Experian are in line with providers’ aggregated revenue cycle data from other recent surveys and earnings commentary from health system executives.
The latest monthly benchmark data from revenue cycle management vendor Kodiak Solutions showed an 11.8% initial denial rate in June, up 2.6% month over month and 1.7% year over year and largely tied to more request for information denials and coordination of benefit denials. Initial denial rates rose 14.3% from May to June, to 1.6%, though that rate is 5.9% lower than the same time last year.
During a Wednesday presentation at Kodiak’s annual client networking event, the vendor noted that initial RFI denials in particular have risen from 3.2% of total billed charges in 2022 to 3.3% in 2023 and 3.5% in 2024 (year to date).
“We’ve got about $1.4 trillion flowing through our database across our benchmarking community,” Matt Szaflarski, Kodiak’s revenue cycle intelligence leader, explained to attendees during the presentation. “[3.5% is] just under $50 billion in additional RFI denials and, by our calculations, will drive about $140 million in additional cost [across Kodiak’s customers] if RFI denials remain at this level across the rest of the year.”
Another survey of 134 health system revenue cycle heads published last month similarly reported that about 2 in 5 organizations were “struggling” with elevated fatal denial rates and that even more were facing higher Medicare Advantage (MA) denial rates. “Payer challenges” and prior authorization were named among the respondents’ highest stressors.
Though it's notched policy wins this year in terms of prior authorization, the hospital lobby has broadly turned its attention to critiquing what it describes as more aggressive denial practices from payers. More than 100 provider organizations petitioned the Biden administration in March to take a tougher stance on MA plans in particular following a report that healthcare providers “wasted” over $10 billion overturning initially denied claims.