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Increase Pay-up by Successfully Appealing Claim Denials
What if every time you had
a patient in v-fib, you were allowed to shock him only once? What would
your success rate be? Everyone in EMS knows that defibrillation often
works only on the second, or even the third, shock. The same principle
holds true when it comes to getting reimbursed for medical transportation.
It often takes one, even two, appeals before claims are paid. In fact, as
many as 50 percent of denied claims are eventually paid when the provider
appeals the Explanation of Benefits (EOB).
“Insurance companies deny
thousands of claims a year with what appears to be substantial evidence to
support such non-payment,” explained Tammy Tipton, president of Appeal
Solutions, a manufacturer of software to help process EOB appeals. “They
do this knowing that most denials are accepted without question or action.
They know many medical providers do not have the time, legal expertise and
insurance industry experience to investigate the basis, or lack thereof,
of claim denials.”
EMS services need to appeal every denial, Tipton went on to say.
“Establish yourself as very aggressive on appeals. Then the carrier begins
to recognize you as someone who will appeal, and if there’s ever any gray
area on your claims, they will pay because they know if they don’t, they
will hear from you.”
federal and commercial areas, many EMS claims are denied for lack of
“Medical necessity.” This denial is very common in air medical services,
which are not only very expensive, but also can be considered medically
unnecessary if similar ground transportation is available.
Medical necessity denials do not have to be accepted. The first step to
appealing them is to demand proof from the insurance carrier to
substantiate the denial. Call the carrier and ask specifically what led
the claims processor to believe that the transport was medically
unnecessary. Ask what additional documentation he or she would need to
overturn the denial.
Many times, the claim will turn on documentation of medical necessity,
but EMS providers and physicians must be schooled in writing down the
specific information that the claims processor wants to see. In no case
is medical necessity documentation more important than in critical care
transport. “If a Letter of Medical Necessity is needed, the best way to
get a letter containing the appropriate information is to call the
doctor’s office and speak directly with the doctor and explain what you
need and why you need it,” said Linda Kilgore, office manager for Med
Flight Air Ambulance in Albuquerque. When Kilgore makes these calls, she
asks that the physician’s letter include:
- A detailed description of the patient’s condition
- The reason that the patient could not receive appropriate treatment at
the referring hospital
- A detailed description of the therapies that were available only at
the receiving hospital
- The reasons that the patient could not be treated at a medical
facility in closer proximity to the referring hospital
- The reason that the patient could not be transferred using other means
In addition to telephoning the physician or requiring similar
documentation of medical necessity from your paramedics, shift
supervisor or medical director, Tipton suggests calling the patient
directly to inquire about coverage. Ask the patient to scan his
insurance policy and to read you the section on medical transportation.
If the denial seems out of line with the policy, obtain a copy of that
portion of the policy to include in your appeal. Suggest that the
patient also file an appeal, Tipton said, as a second appeal will
support your case.
As hard as it is to believe, Tipton said that she still sees a lot of
denials related to lack of precertification for medical transportation
even though many states prohibit insurers from requiring
precertification on emergency services. “You should always appeal this
type of denial,” Tipton advised. “It’s unconscionable that they would
deny for that reason.”
Regarding non-emergency transports, Kilgore said: “Medicare and Medicaid
will not pre-approve air ambulance transportation; however, most private
insurance companies now require it. At the time of the initial call, if
time allows, prior approval can often be obtained from these insurance
companies with a couple of phone calls. The process requires more work,
but can benefit you by ensuring faster payment by submitting the claim
with the approval number.”
Slow Payment and Low Payment
Most states have laws and regulations that protect EMS providers from
slow payment and low payment by commercial insurers, and one-half
require insurance carriers to pay interest on late payments under
certain circumstances, Tipton said. But the only way to collect this
money is to demand it in writing. “Put insurers on notice that staff
reductions, computer downtime and bureaucratic inefficiency can no
longer be an excuse for long processing periods,” she said, adding that
typical timely payment statutes require payment in 45 days or less.
EMS services also can appeal low payments that the carrier says are
based on “usual and customary charges” for your region, if the fees are
not associated with a contractual agreement. “Medical providers are
under no obligation to agree to price reductions not associated with
contractual agreement,” said Tipton. “Therefore, medical providers need
to educate their staffs on what charges are subject to write-offs and
which ones should be pursued for full payment.” For example, if the
usual and customary reduction reduces your payment to 50 percent of the
full charge, but the patient’s benefits say that medical transportation
is to be paid at 80 percent, then an appeal can be submitted on the
basis that the carrier is not honoring the benefits.
With all denial appeals, you have to be persistent. “Follow up is
absolutely crucial,” said Tipton. “Carriers lose appeals letters left
and right because they are processing such a huge volume of accounts.
Follow up so that your claims are the ones that get attention. Call them
as often as you can. Re-fax your appeal to the person you talk with on
“Remember, tenacity may be your biggest asset when appealing claim
denials,” Tipton said. “Do not give up until you are satisfied with the
answer you receive.”
AppealLettersOnline.com can assist providers implement an effective denial management program.
AppealLettersOnline.com is an interactive resource provided to level the playing field between Insurance Companies and Medical Providers. You
will find appeal letters, case studies, articles, other resources and the latest intelligence necessary to help healthcare providers make
vital decisions and take strategic actions to address payer denial issues.
AppealLettersOnline.com will help health care
providers actively develop the processes, analytical tracking information, educational programs and procedures needed for
implementing an effective denial management program.
Some of the topics covered at AppealLettersOnline.com include addressing payment reductions such as usual and
customary and out-of-network care reductions, lack of timely filing denials, pre-existing conditions and medical necessity
appeals and improving verification of benefits procedures. Treatment exclusions, maximum benefits denials and
subrogation/coordination denials are also discussed. Tips are also provided on appealing for interest and penalty payment on
late payments and appealing a request for a refund of previously paid claims.
AppealLettersOnline.com discusses all types
of claims including Managed Care, Indemnity, Government, Self-Funded, ERISA
claim issues and managed care contractual payment discrepancies.
This article was
written by Lauren Simon Ostrow, Editor of EMS Best Practices. This
article is reprinted with permission. Copyright Feb. 1999. EMS Best
Practices is a monthly newsletter that publishes articles and
information about best business practices. The content is designed
specifically to assist EMS managers in running more efficient and
effective EMS operations. For more information or a free sample issue,
call (619) 456-8600 or send an email with your name and postal address
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