Just imagine, you treat a patient and submit a claim, but the payer denies it, and you don’t receive the due payment for the dental services rendered.
Most dental practices already give up on that, considering it lost revenue, and write it off. And now, when you write off payments for many claims, it’s an annual revenue loss of thousands of dollars.
But here is some good news: You can recover this amount if you implement smart denial management strategies through reliable dental RCM services in your practice.
Eager to recover your hard-earned dollars? Let’s discuss ways to manage claim denials, make reimbursements fast, and maximize collections.
What is Denial Management?
First, let’s understand denial management.
It’s a complete process in the dental revenue cycle, which dental practices follow. It includes:
- Checking the claim denial reason in an explanation of benefits
- Fixing the error
- Submitting the corrected claim to the payer within its appeal deadlines
- Appealing to the payer to reimburse the amount
And denial management isn’t just limited to managing denied claims. You also need to record the billing errors and corrections in your practice management system, so your team is aware of them, and they don’t repeat these mistakes in future claims.
With that, denial management is both a proactive and a reactive process.
And, while it seems very simple on paper, denial management requires a proper strategy to correct the mistakes, resubmit claims, and recover your due payments.
So, let’s discuss the complete process and how you can make it effective for reimbursements.
How to Implement the Denial Management Process?
Let’s discuss the dental billing denial management process, so you know how it works and how you can implement it in your practice to boost dental claim reimbursements.
Review the Denial Reason on EOB
Denial management starts when the payer denies a claim and sends you an explanation of benefits. The EOB includes the denial reason, mostly in the ‘Remark Code” section. Payers use short denial codes, which explain why a claim is denied.
For example, if the payer mentions CO-16 in the remark code, it can be due to incorrect coding.
One important thing to note is that the American National Standards Institute (ANSI) sets standard denial codes via X12, but payers may interpret their own meaning. So, you must check the payers’ list of denial codes to see how they interpret each code.
Now, the denial reason helps you find the billing error, so you can act accordingly.
Fix the Billing Error
When you find the denial reason in the EOB, it’s time to start fixing the billing errors that have led to the denial in the first place.
Below are common dental claim denial reasons and solutions:
Coding Errors
Payer denies a dental claim due to incorrect or outdated codes.
Fix: Check ADA’s latest CDT code updates and your payer manuals to see new and accepted codes. After that, use the right code that matches the procedure in the claim form for resubmission.
Eligibility Issues
A dental claim is denied when incorrect or outdated patient information is entered in the claim, whether it’s patient demographics or insurance details.
Fix: Use real-time eligibility verification to check the patient’s coverage plan. It helps you confirm if a patient is eligible for the treatment. You can also match the patient’s information with the payer portal to see if the patient’s data in your system is accurate. When data is verified, enter the correct and updated details in the claim form for resubmission.
Frequency Limitation Issues
It’s very common for payers to deny claims due to frequency limitation issues. These denials occur when you bill for a procedure before the payer’s waiting period has passed, or a service that exceeds the plan’s treatment limit for the patient. Either way, the payer denies your claim as it doesn’t comply with frequency limitation rules.
Fix: In a normal situation, when frequency limitations are exhausted or waiting periods are in place, payers don’t reimburse, and the patient is completely responsible for all the charges. However, you may contest it if you can attach supporting documents to prove that the treatment is necessary for the patient’s health. It may convince the payer to reimburse.
Late Claim Submission
Payers set a deadline for submitting dental claims after you treat a patient. The deadline can be different for each payer, but mostly, it’s a 60 to 180-day time limit from the date of service.
When you submit a claim after the payer’s deadline expires, the payer doesn’t accept the dental claim.
Fix: Appeals for late claim submissions aren’t accepted unless you can prove that you have submitted the claim on time, and it’s delayed due to any of the following reasons:
- Payer mistakenly denies a claim while it’s correct and submitted on time. It may be due to an error in the payer’s system.
- A clearinghouse error occurs while you try to submit the claim
- Coordination of Benefits (COB) delays the submission when you receive the primary claim’s EOB late.
- Payer doesn’t provide you with the patient’s updated insurance information on time.
You must document all the conversations, screenshots, and tracking numbers for each case to prove that you have followed the payer’s timely filing limit.
Examples include
- A proof of original submission, which can be a clearinghouse report or screenshot
- EOB from the primary insurance, if the patient has dual coverage
- Evidence of how your practice receives patients’ information and updates it. For that, you can attach:
- The patient intake form should include the date of service and the date when the payer has provided you with the updated insurance details. If the payer has provided details after treatment, you can prove that it’s not your fault.
- A copy of the patient’s insurance card with the date when you receive or update it in the system.
- Communication via email, text messages, or phone call notes, which prove that the patient has updated you about new updates in the coverage plan on time.
- An insurance eligibility check report to prove that you have verified that the coverage is active and the patient is eligible to receive treatment under insurance.
It makes your denial management strong and may convince the payer to reconsider the claim.
Missing or Insufficient Documentation
A payer denies the claim when attached supporting documents, like intraoral photos, narratives, or X-rays, are incomplete or completely missing.
Fix: Check your payer manual to see the required documents for that procedure. And if the documents aren’t mentioned, consult with the payer representative.
Also, make your documentation strong by attaching all the evidence with narratives that explain which procedure is selected and why it’s important for the patient’s health.
The narrative includes the patient’s complaint, diagnosis, and treatment. Radiographs, periodontal charts, or other materials that prove the treatment and justify its necessity make your appeal strong. So, attach them to your claim form for denial management.
No Pre-Authorization
Payers want to control costs to share maximum benefits across insurance members. So, when you submit a claim for a high-cost or complex procedure, they require you to get their approval first. If you submit a claim without requesting pre-authorization and getting the pre-authorization number, the payer denies the claim.
Fix: When your claim is denied due to a lack of pre-authorization, the payer doesn’t entertain its appeal. The reason is that pre-authorization is required before submitting a claim. So, you have to charge the patient for it, and if the patient doesn’t pay, it’s a write-off.
You may appeal it if it’s an emergency treatment and delaying care is harmful for the patient. But you need to prove that by attaching clinical notes, X-rays, and a narrative that explains the urgency for the treatment. Attach them to your appeal and claim form to request reimbursement.
However, it depends on the payer policies and reimbursement rules. You can appeal only if they allow retro-authorization after you have already treated a patient.
In another case, you may win an appeal if you have actually submitted pre-authorization and received the pre-authorization number from the payer, but the payer mistakenly doesn’t link it. For that, you need to provide screenshots of the payer confirmation and the pre-authorization number as evidence.
Write and Submit an Appeal Request
After you make corrections for the particular denial reason, prepare an appeal letter on your practice’s letterhead. It should be professional and concise. When you write one, address the payer’s appeal department, which handles denied claims.
Explain why the payer should approve your claim by justifying it with clinical evidence and solid reasoning.
Here is a letter template that explains how to appeal a denied dental insurance claim. You can customize it according to the patient’s treatment needs:
Subject: Appeal for Denied Claim – Missing Prior Authorization
Date: [Insert Date]
To:
Claims Appeals Department
[Insurance Company Name]
Provider Information:
Provider Name: [Dentist/Practice Name]
NPI: [Provider NPI]
Tax ID: [TIN]
Address: [Practice Address]
Phone: [Phone Number]
Patient Information:
Patient Name: [Patient Name]
Member ID: [Insurance ID]
Date of Birth: [DOB]
Claim Information:
Claim Number: [Claim Number]
Date of Service: [DOS]
Procedure Code(s): [CDT Codes]
Amount Billed: [$ Amount]
Dear Claims Review Department,
I am writing to formally appeal the denial of the above-referenced claim, which was denied due to a lack of prior authorization.
The procedure(s) performed on [Date of Service] were medically necessary based on the patient’s clinical condition at the time of treatment. Supporting documentation, including clinical notes, radiographs, and treatment records, is attached for your review.
Emergency Treatment Explanation:
The patient presented with acute symptoms that required immediate dental intervention. Delaying treatment to obtain prior authorization would have compromised the patient’s oral health and caused unnecessary pain. Therefore, treatment was provided in accordance with standard clinical protocols.
Administrative Oversight Explanation:
The treatment rendered was medically necessary and part of the patient’s approved treatment plan. Unfortunately, the prior authorization requirement was not identified before the service was rendered. We respectfully request reconsideration of the claim based on the medical necessity of the treatment.
Authorization Obtained but Not Reflected:
Prior authorization for this procedure was obtained under authorization number [Authorization Number], but it appears this was not linked to the claim during processing. Documentation of the authorization approval is attached.
Based on the clinical necessity of the treatment and the supporting documentation provided, we respectfully request a reconsideration and reprocessing of this claim for payment.
Please feel free to contact our office if additional information is required.
Sincerely,
[Provider Name or Billing Representative]
[Title]
[Practice Name]
[Phone Number]
[Email Address]
Attachments:
Clinical Notes
Radiographs / Diagnostic Images
Treatment Plan
Authorization Documentation (if applicable)
Copy of Original Claim
Based on that, submit your appeal request to the payer.
Track the Appeal
After submitting the appeal, document everything, including:
- Date of submission
- Method of submission (email, fax, or payer portal, etc.)
- Confirmation number from the payer (if any)
Use that information to track the appeal response by contacting the payer or checking through the payer portal. If you don’t receive the response within 10 to 15 days, follow up with the payer.
Post the Payment or Escalate
When the payer reviews and approves your appeal, it reimburses the claim. Post the payment in the patient ledger after you get reimbursed.
But, if it’s denied again, check the new EOB and review if it can be escalated. If you find any mistakes on the payer’s end, it’s your right to escalate. You can submit a second appeal and explore other options, like requesting a peer-to-peer review with the payer’s dentist or an external review by a third-party examiner.
What are the Best Practices in Denial Management?
Here are a few dental insurance denial management strategies that help you recover revenue fast, and also guide you on how to reduce dental insurance denials.
Verify Patient Coverage Details Before Treatment
Insurance eligibility verification is among the most effective dental claim denial prevention tips. With this proactive approach, most issues end as you verify patient coverage before treating a patient. Confirm the patient’s provided details with the payer in real-time, so information is updated and claims are accurate, reducing denials in the first place.
Track Claim Progress after Submission
While denial management is a back-end revenue cycle process, the best approach is to start it even before a claim is denied.
And that’s when you submit a dental claim to the payer. Start tracking the claim progress, so you can quickly know the payer’s decision. You can do that by logging in to the payer portal (if available) or contacting the payer representative via call or email.
When you receive the payer’s decision on a claim via the dental explanation of benefits, it becomes easy for you to start the process fast. It’s because payers have very strict deadlines for submitting appeals, and if you delay the process, payers don’t accept it, and you have to write off your revenue.
So, track in real-time and act fast to recover payments.
Build an Attachment Checklist for Procedures
Prepare a documented list of required attachments for certain procedures, like crowns, implants, and scaling and root planing (SRP). Check your payer-specific documentation requirements or consult with the payer to get the list for each procedure.
Build a checklist for these procedures, so when you submit claims, you can check if all the required documents are attached. If any document is missing, arrange for it and attach it to the complete claim submission to prevent denials.
Review Each Denial
When a payer denies your claim, don’t just accept it as a revenue loss and write it off. Check if the denial is valid or not. Sometimes, the payer can make mistakes due to manual errors or system issues. If your claim is correct, it strengthens your appeal request and overall denial management.
Track and Reduce Accounts Receivable
When claims are denied, your billing staff may forget to track and appeal them due to workload. As a result, payments are stuck, which affects your cash flow. So, check outstanding balances in your accounts receivable. Divide them by aging buckets and set priority.
In most cases, practices aim to resolve older claims first as they are hard to recover, but that doesn’t mean you should ignore newer claims. Since these are easier to collect, set a strategy to recover them first.
Some claims may be older but of lower dollar value, while some may be newer but have a higher dollar value. So, it’s up to you to analyze your revenue and decide what to pursue.
Audit Your Denial Patterns
Perform billing audits and pull the claim denial data for the last 90 days. Categorize your claim denials by reason codes. It answers the question: Why are dental claims being denied?
Audits help you find the top-most claim denials, so you can make corrections, like updating billing processes, documentation templates, or training processes, to prevent billing errors for future claims. It makes payments fast and the revenue cycle smooth.
Automate Denial Management
Most claims are denied due to manual billing processes, which are always prone to errors. The best solution is to leverage high-tech solutions, like robotic process automation, to prevent denials.
RPA is very effective in denial management, as it works on pre-set rules, customized to your practice’s billing requirements. Whether you use a separate RPA or integrate it with your practice management system, it catches denials fast and automates denial management to the denial reason.
Outsource Denial Management
Denial management is a very important process for dental practice revenue cycle management. If it goes wrong, you end up losing dollars that can be easily collected.
So, an effective way is to outsource dental denial management services to a reliable RCM services provider like TransDental for smoother collections.
Experienced dental RCM companies use the latest technology and services from expert billers and coders to streamline denial management for your practice. This is how outsourcing helps:
- Dedicated billing specialists track payer policies, which your in-house staff may not be able to learn due to time constraints
- Appeal submissions are timely and faster.
- Denial patterns are easy to track, leading to faster prevention
- The front office is relieved of insurance follow-ups and can focus on improving patient experience
- Practices using automation and outsourced RCM see denial rates drop by 30 to 35%
And all that comes at cost-effective RCM services.
Conclusion
Denial management is effective if you review denial reasons on dental EOBs, fix errors, and submit professional and strong appeals with all supporting evidence. You can make it more efficient and faster by automating the entire process or outsourcing it to experts, who can manage denials promptly for faster reimbursements, track denial patterns, and implement strategies to prevent future denials.
Frequently Asked Questions (FAQs)
What is denial management in dental billing?
Denial management is the process of tracking, analyzing, appealing, and preventing insurance claim denials in a dental practice. It ensures that denied claims are either corrected and resubmitted, successfully appealed, or identified as patterns to prevent future denials.
How long does a dental practice have to appeal a denied claim?
Most insurance companies allow between 30 and 180 days from the denial date to submit a formal appeal. Some payers accept appeals online through a portal; others require written letters sent by fax or mail. But, still you must check your payer’s deadlines for submitting appeals.
What’s the difference between a rejected claim and a denied claim?
A rejected claim is returned by a clearinghouse before submission due to reasons like formatting issues, missing information, or an eligibility error. It was never formally processed. A denied claim, on the other hand, is received and reviewed by the payer, but the payer doesn’t reimburse it due to billing errors or payer compliance violations.
Can payments for most denied dental claims be recovered through appeals?
Payers approve most appeals and reimburse them if these are properly documented and submitted on time. By investing in TransDental’s denial management services, you can recover payments quickly with professional appeals.
How does denial management help reduce dental practice write-offs?
Professional denial management helps practices catch denials early, resolving them within payer timelines, and escalating appeals when needed. It also reduces future write-offs by identifying root causes like documentation gaps or coding errors, and fixing them before claim submission for quick reimbursement.
