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Practice Management Alert

Know When to Appeal and How

Published on Sat Jun 01, 2002

Insurers deny payment for various reasons, some of which may be invalid. However, staff time cannot be spent arguing every denial. Therefore, you need to know key items to spot to determine which claims you should appeal and how to start the process.

Steven M. Verno, CMBSI, NREMPT, director of reimbursement for Emergency Medicine Specialists in Hollywood, Fla., and compliance director of the Medical Association of Billers based in Las Vegas, offers these examples of insurers' action that you should consider appealing:

  • nonpayment of your claim
  • downcoding of your claim
  • refund requests
  • denials based on medical necessity
  • denials that claims services are inclusive in a CPT code
  • "usual and customary" payment
  • lack of authorization
  • lack of timely filing.

    The first step after receiving a denial is determining whether it is valid, says Sarah F. Mountford, BA, CPC, accounts receivable coordinator for Physicians Business Network in Overland Park, Kan., a company that bills for 34 physician practices. "We usually go back to the medical record and look to see if the services were coded properly. If they were, and they are services for which the payer does pay according to its reimbursement policy, then we appeal," she says.

    To Call or Not to Call

    Filing an appeal usually involves writing a letter to the insurer explaining why its action was incorrect. Some practices call the insurer's customer service department, provider representative or appeals department first to try to find out why the claim was denied and resolve the issue over the phone. If you have a good, working relationship with a particular person at the insurer, such a strategy might work for simple problems, Mountford says. But she recommends moving straight to the appeal letter. "We don't make phone calls if we can determine what the problem is. For example, if we know it's an inclusive denial, we know the payer is going to want to see the medical notes, and we're going to have to send a letter of appeal," she says.

    However, Mountford says a phone call to the payer might be warranted when you don't understand the basis for the denial. Without understanding the reason the claim was denied, you can't effectively argue against it, she adds. If you call the payer, document the name of the person to whom you spoke, the date and time, and the content of the conversation. Such information may become a valuable part of your argument in your appeal letter.

    The following are five tips for winning an appeal:

  • Address your appeal to the right person. Sending your appeal to the customer service or claims department can result in its misplacement or another denial. "You want to get your appeal to the person who is going to read the letter and the documentation and know what you're talking about," Mountford says. She sends her appeals to the attention of the head of the medical review department. Verno recommends always sending your appeal to the president or the chief executive officer of the insurance company or carrier. "By doing so, you can be assured your claim will be received and reviewed," he says.
  • Write a letter that covers everything. Make sure your appeal paints a clear picture of the services rendered and what happened to your claim after you sent it, Verno advises. He suggests stating in the letter:
  • how the claim is supposed to be coded and paid
  • how the claim was handled and paid by the carrier or insurer
  • how the insurer's or a carrier's handling and paying of the claim is different from how it is supposed to be done
  • what must be done to correct the problem.

    Mountford says she attributes her successful appeals to the language she uses in her letters. "For example, with the inclusive denials, you have to convince them that you're right, and you really should be paid separately for the service. State that this is separately payable for this reason, and if you look at the operative report, you'll find that we did this," she suggests. Use a tone in your letter that indicates you know what you're talking about, she adds.

  • Always attach supporting documentation. In addition to stating your case in your appeal letter, include copies of documentation from reliable sources to support and prove it. "You want your side of the story to be airtight," Verno says. Examples of appropriate documentation include copies of:
  • medical records
  • operative notes
  • pages out of the CPT and ICD-9-CM manual
  • rules of the Correct Coding Initiative
  • pages out of the Medicare Carriers Manual
  • communications from Medicare
  • medical journal articles
  • materials from the American Medical Association or other medical societies
  • statutes from your state laws
  • court case decisions.

    He also suggests creating an "appeals book," including copies of state laws, references from agencies such as CMS, and copies of articles that discuss the topic of your appeals, so you will have documentation materials on hand.

  • Send your appeal and documentation by certified mail, return receipt. "By sending your documentation this way, you can be assured that it will be received at its final destination," Verno says. Plus, you will have proof of the date you sent it and the signature of the person who received it. "If the carrier says it never received your appeal or documentation, you can file a complaint with your state insurance commissioner or other state insurance regulating agency," he says.
  • Be persistent. Many appeals are not won on the first try. "The carrier hopes you will accept whatever it says and go away," Verno observes. "If you continue pursuing your appeal, the carrier eventually will take you seriously." $ $ $

     

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