Does your Patient Financial Services team know the difference between a denied VA community care hospital claim and a rejected one? Although the terms sound interchangeable, the answer holds critical implications for a hospital’s revenue cycle.
A denial, in VA claims terminology, is a significant hurdle — it refers to claims deemed unpayable due to a lack of prior authorization. To reverse a denial, PFS teams will face a lengthy process to make the case that a provided healthcare service should be approved after the fact. (We explained the process recently in this blog post about emergency healthcare services.)
A rejection, on the other hand, happens when a claim is missing critical information or contains billing errors. In other words, most rejected claims are the result of an oversight or clerical error. According to the Dept. of Veterans Affairs, these are the top 10 reasons for rejected hospital claims:
- Missing/incomplete/invalid Insured ID
- The outpatient claim has a missing Admission Type code
- Missing Admission Type when Admission Date is present
- Referring and Attending Physician NPI are equal
- Claim contains a missing/incomplete/invalid Billing Provider Address
- Claim contains missing or invalid Patient Status
- Claim contains ICD9 Principal Dx code
- Claim contains invalid or missing Patient Reason diagnosis code
- Missing Patient Account Number
- Invalid Type of Bill code
Don’t be fooled by the simplicity of the list, however. While on the hospital end these may be minor discrepancies, on the VA side they can add months or even years to the claims process.
How can that be? Denied and rejected claims are subject to the VA’s appeals process, which despite improvement efforts is still arduous and inefficient. A November 2019 report from the VA Office of the Inspector General (OIG) revealed that the VA had been storing thousands of rejected claim appeals in boxes and file cabinets without processing them. The average unprocessed appeal had been pending for 710 days.
All this speaks to a key tenet in the management of complex healthcare claims: It’s imperative to file them correctly the first time.
Recovering revenue for VA claims requires PFS staff to follow a complex set of rules that are unique to the VA, and there’s little room for error. Most health systems find that it takes a dedicated specialist to master the nuances of VA community care claims, either in house or outsourced. Specialization pays off—it’s not unusual, for example, for our clients to see a 100% increase in overall VA payments along with a 50% reduction in days to pay.
Without a VA specialist…well, hospitals are setting themselves up for rejection.
Learn More: We deconstruct the full VA claims process in our latest white paper. Download it here.
Argos Health is a KLAS top performer in the complex claims category and has been a revenue cycle partner for VA community care claims services longer than any other vendor. Our clients often see a 100% increase in overall VA payments, along with a 50% reduction in days to pay.