The Unwanted Price Tag of Medical Billing Errors and How to Fix It

A woman with a blonde hair, wearing white dress, silver ring and bracelet, with her hand on her face holding pencil and a medical bill

Did you know that even a tiny mistake can derail your cash flow? This is why effective medical billing is crucial to ensure the financial stability of healthcare providers. However, recent trends show a troubling increase in denial rates, with figures exceeding 20% and averaging 10% or higher for insurance claims. Moreover, a 2021 survey by the Medical Group Management Association (MGMA) also found denials increased by 17% for practices alone. While these issues can be managed, doing so is also costly, averaging $25 per claim for practices and $181 for hospitals.

In this blog, we delve deeper into the landscape of medical billing by exploring its pivotal role, identifying common billing errors to anticipate, and offering proactive solutions that healthcare practices can adopt to minimize financial risks.

Importance of accurate medical billing

Accurate medical billing is more than about payments and revenue—it reflects how well doctors meet patient needs and cultivate trust.

However, in today’s medical landscape, doctors juggle multiple tasks, including managing increased patient volumes, attending to complex procedures, and doing meticulous documentation. Given these tedious demands, there is often limited time for precise billing and coding, crucial to sustaining financial stability and compliance with the guidelines set by the Centers for Medicare and Medicaid Services (CMS) and the National Center for Health Statistics (NCHS).

Medical billing errors go beyond finances. Errors or delays can confuse patients and lose their trust in healthcare providers. Therefore, careful attention to billing detail is crucial, promoting clarity, enhancing patient satisfaction, and strengthening the doctor-patient relationship.

Why are the billing errors increasing?

There are several factors contributing to the increase in these errors. Understanding these factors is crucial for healthcare providers striving to improve accuracy and efficiency in billing processes. Some of the key contributors to medical billing errors include:

Coding mistakes: Incorrect use of medical codes or failure to update codes according to current regulations.
Documentation errors: Incomplete or inaccurate patient information, inadequate medical documentation, or failure to obtain necessary authorizations.
Substandard technology: Suboptimal billing systems, lack of integration between Electronic Health Records (EHRs) and billing software, and inadequate training on new technologies.
Workflow inefficiencies: Staff turnover, insufficient training, and workload pressures can all contribute to human errors in billing processes.

The accuracy of medical billing processes is crucial in healthcare. Addressing these factors is essential for healthcare providers seeking to enhance billing accuracy and efficiency.

Understanding the cost of errors

When patients encounter incorrect bills or experience delays in receiving bills, it can easily lead to confusion and frustration. The most likely cause is the discrepancies between what was expected regarding costs and what is billed.

As such, billing errors impact patients and can be costly for healthcare providers. When these mistakes aren’t fixed promptly, they affect several important areas:

Financial impact: Billing errors can lead to claim denials or delays in reimbursement, directly impacting revenue streams. According to industry data, denial rates have been on the rise, exceeding 20% in some cases. Each denied claim delays revenue and adds to reprocessing and appealing administrative costs.
Operational inefficiencies: Coding errors, incomplete documentation, or patient information inaccuracies can create billing bottlenecks. This slows the revenue cycle and increases the workload for administrative staff who must rectify these mistakes.
Patient experience: Billing errors can also negatively impact patient satisfaction. Incorrect bills or delayed claims processing can lead to uncertainty and dissatisfaction among patients, potentially damaging their trust in the healthcare provider.
Compliance risks: Non-compliance with regulatory requirements due to billing errors can result in penalties or audits, further adding to financial and administrative burdens.

Reduce billing errors with Synapse

Despite the challenges, there are effective ways to reduce medical billing errors, such as outsourcing the entire revenue cycle management to expert medical billers. Given the projected growth in the medical billing outsourcing market from 2023 to 2028, this approach is becoming increasingly crucial as healthcare systems continue to advance technologically. Analyzing data also helps clinics better understand patient care. And with rising cybersecurity threats, protecting patient information is now a top priority.

At Synapse, we offer several proactive solutions to keep you at the forefront of these advancements and improve your medical billing cycle:

Electronic Health Record (EHR) Integration: Synapse utilizes integrated billing modules within our EHR systems, allowing you to streamline patient care management while ensuring accurate billing.
Advanced coding solutions: We employ a 21st-century reporting dashboard that allows clients to review all operations and seamlessly filter patient data and demographics. This results in an interactive system fine-tuned to the client’s goals and needs.
Credentialing services: Let us manage and track all your enrollments, freeing you to focus on delivering exceptional patient care.
Collections services: Synapse manages the entire revenue cycle, from claim submission and tracking to resolving denials and delays, ensuring smooth financial operations for your practice.
Custom software development: Collaborate with us to develop intuitive and visually appealing online platforms that enhance the efficiency of your practice.
Continuous improvement: Continuous Improvement: Regularly review billing processes to promptly identify and correct errors and stay compliant with evolving regulatory requirements.

By implementing these strategies, Synapse supports healthcare providers in optimizing their billing processes and enhancing overall operational efficiency. Experience an undisrupted medical billing cycle with Synapse. Visit our website at https://synhs.com/ or fill out this contact form to schedule a consultation.