Claim Delays and Rejections

Subject: Health Care
Type: Informative Essay
Pages: 4
Word count: 1014
Topics: Health Insurance, Health, Medicine


Healthcare provision is one of the most robust and significant industries in the United States. The government has over the years paid keen attention to reforming the healthcare sector resulting to rapid changes in the industry’s dynamics and regulatory changes. The existence of support industries such as manufacturing and insurance that work hand in hand with the healthcare sector has resulted in over-emphasis on patient responsibility. This is because it poses a significant challenge to the industry which operates at a 7.2% profit margin. This has necessitated the enactment of measures and policies that address payment risks more aggressively than before (Johnson and Nagarur 2016). As a result, hospitals have embarked on the mission of safeguarding their workflows to maximize their profit margins by reducing the risk of realizing losses through claim delays and rejections through simplifying payment processes for patients or their providers and uncovering additional sources of revenue. This paper thus seeks to enlighten us on why claims may be denied or rejected in the healthcare through a careful analysis of factors such as coordination of benefits, submission of claims as well as inadequate subscriber information

Submission of claims

In the contemporary world, advancements in science and technology have significantly impacted healthcare provision in the country. As a result, most of the claims in the sector are made electronically to a Medicare Administrative Contractor (MAC) for a provider often using software that satisfies electronic filing requirements (Johnson and Nagarur 2016). The Medicare Administrative Contractor is tasked with the responsibility of ensuring that the claims presented to meet the requirements specified by the HIPAA standards. Occasionally the verification may detect some errors causing the rest of the claims to be rejected for resubmission or correction. Claims which pass such front-end edits are then edited against implementation guide requirements which are also part of the HIPAA standards and requirements. The detection of errors by the MAC at this stage results in the rejection of the claims that contain the errors only. Successful claims are then edited for compliance and payment policy requirement. The errors originating may include: 


This often occurs when the provider intentionally leaves out a procedure code from a superbill or codes for an extensive or less serious procedure than that received by the patient. This fraudulent practice is often done to avoid audits for certain procedures in a bid to cut the patients expenditure. It is imperative to include all the processes that the patient was subjected to ensure that the results that are submitted are accurate. 


This often arises when the medical practitioner misinterprets the procedures done on the patient. Codes may be entered for services not received by the patient or the inclusion of intensive procedures otherwise not needed by the patient. Accuracy in reference to the procedures is imperative to prevent misunderstanding and misinterpretation. 

Poor documentation

In contrast, while upcoding and undercoding are fraudulent practices leading to the denial and rejection of claims, poor documentation has the potential to affect claims processes adversely. This often occurs when the provider provides incorrect, incomplete or illegible information pertaining procedures done during the patient’s visit. The documents that belong to certain cases in the healthcare environment should be properly maintained and organized to avoid loss and damage. 

Coordination of benefits

Coordination of benefits is used to determine the respective payment responsibilities for a citizen with Medicare. This is because it allows for plans that ensure that the taxpayer receives an insurance plan with the primary payment liability and the inclusion of other plans that support the payment plan of the patients when they are covered by more than one plan. The COB process is designed to ensure the proper payment of claims through a correct identification of the benefits available to a Medicare beneficiary (Ringold 2013). As a result, COB ensures that eligibility data is shared across multiple payers available to aid in secondary payments. This thus ensures that the amounts paid in dual-coverage do not exceed 100% of the total calms thereby reducing duplicate payments significantly. However, if patients have dual-coverage, often the secondary payer denies the claim if it is submitted without the primary EOB information which ought to be attached to the claim electronically. However, exceptions may occur for VFC dual covered patients who possess a primary commercial carrier as well as a Medicaid payer or product as the secondary payer. This is because VFC operations allow VFC providers to bypass the primary payer and directly bill the secondary payer. This could be due to inadequate information provided by the patient to the primary insurer at the time of service or lack of coordination between the VFC provider and the patient’s primary insurer (Ringold 2013).

Subscriber information

The prompt payment of insurance claims entails a careful analysis of the patient information to ensure that correct information was billed for a particular DOS (date of service) according to the demographics availed by the patient. The billing part is also mandated in ensuring that the termination date is valid as well as the subscribed plan that the patient chose. This thus necessitates constant updating of information as well as frequently contacting the patient in case of data discrepancies. Often claims could be denied under the same account if the patient was issued with an outdated or defective card or the lack of active coverage at the time of service (Denny et al., 2014). This necessitates the encouragement of patient responsibility and discussion of payment arrangements. 


The Affordable Care Act has eased access to insurance for the American citizen to and thus improved health care provision significantly. This has thus increased the number of reimbursable claims made by local health institutions leading to more denials and rejections as explained above. All the parties involved in the healthcare delivery process should demonstrate responsibility and truthfulness. However, it is essential for billers to stay updated on billing and coding trends as well as being diligent enough while filing billing claims to avoid or reduce the rejection and denial of claims. 

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  1. Ringold, J. M. (2013). U.S. Patent No. 8,489,415. Washington, DC: U.S. Patent and Trademark Office.
  2. Johnson, M. E., & Nagarur, N. (2016). Multi-stage methodology to detect health insurance claim fraud. Health care management science, 19(3), 249-260.
  3. Denny Jr, J. M., Bridge, T. C., Bradley, K. P., & Edwards, S. K. (2014). U.S. Patent No. 8,655,685. Washington, DC: U.S. Patent and Trademark Office.
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