{"id":3017,"date":"2019-02-14T00:00:05","date_gmt":"2019-02-14T05:00:05","guid":{"rendered":"https:\/\/www.billingparadise.com\/blog\/?p=3017"},"modified":"2026-03-17T05:56:40","modified_gmt":"2026-03-17T10:56:40","slug":"hospital-denial-management-automation","status":"publish","type":"post","link":"https:\/\/www.billingparadise.com\/blog\/hospital-denial-management-automation\/","title":{"rendered":"Stats and Expert Voices on Hospital Denial Management Automation"},"content":{"rendered":"<section  class=\"section no\"><div class=\"row\"><div class=\"wpb_column col-md-12 have-padding\"><div class=\"text-block \" ><div class=\"simple-text \"><h3><strong>Facts and stats that reveal why hospitals should automate their denial management process:<\/strong><\/h3>\n<p><span style=\"font-weight: 400\">It is the era of confounding healthcare reforms. Hospitals across the country are worried about a huge spate in claim denials and revenue flow fluctuations as the industry transitions towards the value-based reimbursement model. It is uncharted territory and to face the challenges ahead, automating the way you handle and prevent denials is the way forward.<\/span><\/p>\n<p><span style=\"font-weight: 400\">Here are statistics that prove the importance of automating the denial management process in 2026. And quotes, views, and opinions of healthcare thought leaders, revenue cycle management experts, and industry leaders. \u00a0<\/span><\/p>\n<p style=\"text-align: center\"><span style=\"background-color: #ffffa0;padding: 10px;text-align: center\"><a title=\"RCM whitepaper\" href=\"https:\/\/www.billingparadise.com\/resources\/whitepapers\/rcm-optimization-whitepaper-for-group-practices.html\">RCM Best Practices for Group Practices and Hospitals<\/a><\/span><\/p>\n<h3 style=\"color: #5093c8\">The truth is in the numbers\u2026<\/h3>\n<div class=\"points\">\n<ul>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">According to a\u00a0<\/span><a href=\"http:\/\/www.amednews.com\/article\/20040621\/opinion\/306219985\/4\/\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400\">report<\/span><\/a><span style=\"font-weight: 400\">\u00a0by the\u00a0<\/span><span style=\"font-weight: 400\">Advisory Board Company<\/span><span style=\"font-weight: 400\">, a research organization, the fact is that 90% of denials are preventable and nearly 60% of these are recoverable.<\/span><span style=\"font-weight: 400\"> 44% of hospital executives use vendor solutions for managing denials<\/span><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">31% of hospitals are still handling denials manually<\/span><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">18% of hospitals use a home-grown tool<\/span><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">7% are unsure\u00a0<\/span>60% of respondents without a vendor-provided solution will purchase one in the next 7-12 months<\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">According to the\u00a0<\/span><i><span style=\"font-weight: 400\">Healthy Hospital Revenue Cycle Index<\/span><\/i><span style=\"font-weight: 400\">, approximately $262 billion in healthcare claims are initially denied \u2014 an estimated 9% of charge.<\/span><\/li>\n<\/ul>\n<ul>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">Over half of the respondents surveyed by RACMonitor reported paying more than $30 per account to resolve denials, with 38 percent paying more than $40. This points to an industry-wide opportunity to seek out and implement systems that will reduce this cost.<\/span><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">According to the American Medical Association\u2019s (AMA) most recent\u00a0<\/span><b>health insurer report card<\/b><span style=\"font-weight: 400\">, claim denial rates ranged from 0.54 percent to 2.64 percent for major private payers in 2013, while Medicare denied almost five percent of claims.<\/span><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">The survey showed that the majority of respondents are achieving between 60-90 percent appeal success rates<\/span><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">\u00a0The average automated claim denial from Medicare\u2019s Recovery Audit Program was worth $714 in the second quarter of 2016, the American Hospital Association (AHA)\u00a0<\/span><a href=\"https:\/\/www.techtarget.com\/revcyclemanagement\" target=\"_blank\" rel=\"nofollow noopener\"><b>reported<\/b><\/a><span style=\"font-weight: 400\">. For complex denials that required medical record review, the average dollar amount per claim denial was $5,418.<\/span><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">While some claim denials could lead to significant healthcare revenue declines, the Medical Group Management Association (MGMA)\u00a0<\/span>found<span style=\"font-weight: 400\">\u00a0that approximately 65 percent of claim denials were never corrected and re-submitted to payers for reimbursement.<\/span><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">The average automated claim denial from Medicare\u2019s Recovery Audit Program was worth $714 in the second quarter of 2016, the American Hospital Association (AHA)\u00a0<\/span><b>reported<\/b><span style=\"font-weight: 400\">. For complex denials that required medical record review, the average dollar amount per claim denial was $5,418.<\/span><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">NextGen survey reveals <\/span><span style=\"font-weight: 400\">more than eight percent still don\u2019t leverage core RCM automation technology.<\/span><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">We asked practices to evaluate and rate their ability to follow up and resolve denials. Only 11.4 percent rated their practices \u201cExcellent,\u201d whereas, 52.3 percent of practices rated their ability as \u201cVery Good,\u201d 28 percent as \u201cAverage,\u201d and 8.3 percent rated their denial resolution as \u201cBelow Average.\u201d<\/span><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">More than 40 percent of participating practices report having one full-time employee (FTE) dedicated to claims denial management, whereas eight percent of reporting practices have seven or more FTEs dedicated to this effort. For practices surveyed that do outsource, 70 percent say their external billing provider handles denial resolution.<\/span><\/li>\n<li style=\"font-weight: 400\"><span style=\"font-weight: 400\">More than 70% of medical practices are outsourcing their denial and AR follow up tasks<\/span><\/li>\n<\/ul>\n<\/div>\n<p style=\"text-align: center\"><span style=\"background-color: #ffffa0;padding: 10px\"> <a href=\"https:\/\/www.billingparadise.com\/resources\/whitepapers\/denial-management-whitepaper.html\">Download your free copy of the denial management whitepaper from BillingParadise<\/a><\/span><\/p>\n<h3>Expert voices on denial management automation<\/h3>\n<p style=\"color: #5093c8;font-weight: bold\">Organizations have not automated denial management<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-3077\" src=\"https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Brendan-FitzGerald.jpg\" alt=\"Brendan FitzGerald\" width=\"865\" height=\"255\" srcset=\"https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Brendan-FitzGerald.jpg 865w, https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Brendan-FitzGerald-300x88.jpg 300w, https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Brendan-FitzGerald-768x226.jpg 768w\" sizes=\"auto, (max-width: 865px) 100vw, 865px\" \/>\u201cGiven the complexities around submitting claims and the labor associated with managing denials, it came as a surprise that more organizations have not automated the denial management process through a vendor-provided solution,\u201d<\/p>\n<p><span style=\"color: #f60\">Brendan FitzGerald<\/span>, HIMSS Analytics Director of Research.<\/p>\n<p>Follow <a class=\"doct\" href=\"https:\/\/x.com\/bfitz_vt\" target=\"_blank\" rel=\"nofollow noopener\">Brendan FitzGerald<\/a>, on Twitter<\/p>\n<p style=\"color: #5093c8;font-weight: bold\">Free physicians from needless administrative tasks<\/p>\n<p style=\"color: #5093c8\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-3079\" src=\"https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Ardis-Dee-Hoven.jpg\" alt=\"Ardis Dee Hoven\" width=\"865\" height=\"255\" srcset=\"https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Ardis-Dee-Hoven.jpg 865w, https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Ardis-Dee-Hoven-300x88.jpg 300w, https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Ardis-Dee-Hoven-768x226.jpg 768w\" sizes=\"auto, (max-width: 865px) 100vw, 865px\" \/><\/p>\n<p>&#8220;We must move toward an automated approach for processing medical claims that will save precious healthcare dollars and free physicians from needless administrative tasks that take time away from patient care.\u201d<\/p>\n<p><span style=\"color: #f60\">Ardis Dee Hoven<\/span>, MD, president of the AMA, told\u00a0<em>Medical Economics\u00a0<\/em>in 2014<\/p>\n<p>Know more about <strong>Ardis Dee Hoven<\/strong> <a class=\"doct\" title=\"click here\" href=\"https:\/\/www.ama-assn.org\/about\/authors-news-leadership-viewpoints\/ardis-dee-hoven-md\" target=\"_blank\" rel=\"nofollow noopener\">Here<\/a><\/p>\n<p style=\"color: #5093c8;font-weight: bold\">Claims management appears to be the next for vendor opportunity<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-3081\" src=\"https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Doug-Brown.jpg\" alt=\"Doug Brown\" width=\"865\" height=\"255\" srcset=\"https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Doug-Brown.jpg 865w, https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Doug-Brown-300x88.jpg 300w, https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Doug-Brown-768x226.jpg 768w\" sizes=\"auto, (max-width: 865px) 100vw, 865px\" \/>&#8220;Claims management appears to be the next for vendor opportunity as ICD-10 effects begin to impact cash flow, followed by eligibility and benefits management,&#8221;<\/p>\n<p><span style=\"color: #f60\">Doug Brown<\/span>, Black Book\u2019s Managing Partner.<\/p>\n<p>Follow <a class=\"doct\" href=\"https:\/\/x.com\/blackbookpolls\" target=\"_blank\" rel=\"nofollow noopener\">Doug Brown<\/a>, on Twitter<\/p>\n<p style=\"color: #5093c8;font-weight: bold\">Lookout for outliers or trends that indicate shifts in payment<\/p>\n<p><strong><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-3082\" src=\"https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Karen-England.jpg\" alt=\"Karen England\" width=\"865\" height=\"255\" srcset=\"https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Karen-England.jpg 865w, https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Karen-England-300x88.jpg 300w, https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Karen-England-768x226.jpg 768w\" sizes=\"auto, (max-width: 865px) 100vw, 865px\" \/>\u201c<\/strong>Revenue cycle leaders must be on the lookout for outliers or trends that indicate shifts in payment or denial patterns,\u201d<\/p>\n<p><span style=\"color: #f60\">Karen England<\/span>, MBA, CPC, Revenue Cycle Consultant at Ingenious Med, to\u00a0<em>RevCycleIntelligence.com\u00a0<\/em>last March<em>.<\/em><\/p>\n<p>Know more about <strong>Karen England<\/strong><\/p>\n<p><span style=\"color: #5093c8\"><b>Experienced professionals share their recommendations to keep your denials in check <\/b><\/span><\/p>\n<p><span style=\"font-weight: 400\"><a href=\"https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2019\/02\/Tara.png\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-7525 aligncenter\" src=\"https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2019\/02\/Tara.png\" alt=\"\" width=\"865\" height=\"255\" srcset=\"https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2019\/02\/Tara.png 865w, https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2019\/02\/Tara-300x88.png 300w, https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2019\/02\/Tara-768x226.png 768w\" sizes=\"auto, (max-width: 865px) 100vw, 865px\" \/><\/a><\/span><\/p>\n<p><span style=\"font-weight: 400\"><span style=\"color: #ff6600\">Tara Dwyer<\/span>, vice president of audit operations at Xsolis, <\/span><a href=\"https:\/\/www.beckershospitalreview.com\/finance\/rcm-tip-of-the-day-use-clinical-merit-to-prioritize-denied-claims\/\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400\">recommended<\/span><\/a><span style=\"font-weight: 400\"> hospitals prioritize claim denial appeals based on the clinical merit of individual cases.<\/span><\/p>\n<p><span style=\"font-weight: 400\"><a href=\"https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Lyman.png\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-7513 aligncenter\" src=\"https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Lyman.png\" alt=\"\" width=\"865\" height=\"255\" srcset=\"https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Lyman.png 865w, https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Lyman-300x88.png 300w, https:\/\/www.billingparadise.com\/blog\/wp-content\/uploads\/2017\/02\/Lyman-768x226.png 768w\" sizes=\"auto, (max-width: 865px) 100vw, 865px\" \/><\/a><\/span><\/p>\n<p><span style=\"font-weight: 400\"><span style=\"color: #ff6600\">Lyman Sornberger<\/span>, vice president of client development at Charles J. Hilton and Associates law firm, <\/span><a href=\"https:\/\/www.beckershospitalreview.com\/finance\/rcm-tip-of-the-day-3-ways-to-respond-to-insurance-denials\/\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400\">provided<\/span><\/a><span style=\"font-weight: 400\"> three operational processes in revenue cycle management to respond to insurance claim denials. <\/span><\/p>\n<p><span style=\"font-weight: 400\">These processes include informal and formal appeals.\u00a0<span style=\"color: #000000\">Lyman Sornberger<\/span><\/span><span style=\"font-weight: 400\">\u00a0said providers also may bring in a third-party healthcare attorney to respond to denials.<\/span><\/p>\n<p style=\"text-align: center\"><span style=\"background-color: #ffffa0;padding: 10px;text-align: center\"><a title=\"Download template\" href=\"https:\/\/www.billingparadise.com\/resources\/templates\/denial-analysis-fact-sheet.html\">Bonus: Download your free copy of the Denial Analysis template<\/a><\/span><\/p>\n<h3>Conclusion:<\/h3>\n<p><span style=\"font-weight: 400\">Optimize your denial cycle, prevent revenue leaks and equip your revenue cycle teams for the changeover to value-based care, with the right set of tools. Putting the power of technology to use is the only way to ensure a financially stable 2026 for your hospital.<\/span><\/p>\n<p><span style=\"font-weight: 400\"> \u00a0<\/span><\/p>\n<\/div><\/div><\/div><\/div><\/section>\n","protected":false},"excerpt":{"rendered":"Facts and stats that reveal why hospitals should automate their denial management process: It is the era of confounding healthcare reforms. Hospitals across the country are worried about a huge spate in claim denials and revenue flow fluctuations as the industry transitions towards the value-based reimbursement model. It is uncharted territory and to face the [...]","protected":false},"author":2,"featured_media":7527,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[744],"tags":[],"class_list":["post-3017","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-rcm"],"_links":{"self":[{"href":"https:\/\/www.billingparadise.com\/blog\/wp-json\/wp\/v2\/posts\/3017","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.billingparadise.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.billingparadise.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.billingparadise.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.billingparadise.com\/blog\/wp-json\/wp\/v2\/comments?post=3017"}],"version-history":[{"count":6,"href":"https:\/\/www.billingparadise.com\/blog\/wp-json\/wp\/v2\/posts\/3017\/revisions"}],"predecessor-version":[{"id":450674,"href":"https:\/\/www.billingparadise.com\/blog\/wp-json\/wp\/v2\/posts\/3017\/revisions\/450674"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.billingparadise.com\/blog\/wp-json\/wp\/v2\/media\/7527"}],"wp:attachment":[{"href":"https:\/\/www.billingparadise.com\/blog\/wp-json\/wp\/v2\/media?parent=3017"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.billingparadise.com\/blog\/wp-json\/wp\/v2\/categories?post=3017"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.billingparadise.com\/blog\/wp-json\/wp\/v2\/tags?post=3017"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}