NShore Patient Advocates, LLC
150 S. Wacker, Ste 2400, Chicago, IL 60606
info@northshorern.com  ·  312-788-2640

The NSPA Blog

Insurance Company Claim Denials

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Posted on June 7th, 2017 by Teri Dreher, under Insurance & Billing, Observation Status

NShore Patient Advocates can help clients with many different types of health insurance claim denials.  Unfortunately, the public isn’t aware or educated on the rules in our healthcare system.  The public takes a reactive approach with their own healthcare.  Consumers are left confused, frustrated and fail to understand their insurance bills.

Top Reasons for Denial 

Medical necessity and clinical denials are among the top two reasons for claim denial.  Medical necessity is dependent upon medical record notes and billing codes; doing it well allows hospitals to maximize their profits.  Lower payment rates under the ACA rules motivate hospitals to justify their costs and get paid quickly. There are several reasons to deny admission for those over 65 years of age.  Due to rigid admission criteria, not all medical occurrences qualify for admitted status. Hospitals are scrutinized and penalized for readmissions within 30 days regardless of medical necessity.  Medicare patients are classified as an “observation status”.

Documentation of Medical Necessity Helps Minimize Claim Denials

Health care claim denialsMost insurance appeals are denied due to documentation issues.  The most confusing issue for seniors is the difference between “observation status” and inpatient status.  One client reported he spent 5 days in the hospital and learned he was never admitted.  Unfortunately, Medicare did not cover his rehab services.  Medicare covers rehab if a patient is an “inpatient” admission for three midnights.  Unfortunately, these types of claim denials are very difficult to overturn.
The hospital Care Managers are caught in the middle of the process.  They start a plan for discharge within 24 hours.  They know a patient may need skilled or rehab services.  The discharge plan includes discharge instructions, skilled nursing or rehab and an expected discharge date.  It becomes obvious, the older adults expect Medicare to pay for skilled care or rehab.

In a similar case, a patient arrived in the Emergency Room.  Imagine if this was you or a family member.  Picture your 85-year-old mother fell and sustained a hip fracture.  She does not qualify for inpatient status.  The physician knows your mother can’t be discharged home and needs rehab.  Hospitals are required to follow the rules under the Affordable Care Act. Sadly, seniors find they are without Medicare coverage.

Medicare Outpatient Observation Notice  

Good news; new ruling took effect on March 8, 2017!!!             Medicare Outpatient Observation Notice

Hospital care managers must give an official notice of observation status within 24 hours.  The notice is called MOON (Medicare Outpatient Observation Notice).  Have you seen this notice?  Next time you are hospitalized, ask about your admission status.  We’d love to hear about your experience in the comment section.  Or call 312-788-2640 for a complimentary consultation.

The Best Strategy Happy patient

The best strategy is to stay healthy!  A better strategy is prevention!

As RN Patient Advocates, we promote patient safety and person-centered care and will advocate for your rights.  We coordinate and talk with your physicians which results in a smooth transition home.  Our greatest impact is in the prevention of medical error and protection of patient rights.  We understand the complex world of US Healthcare.  We encourage aging adults to take ownership for how they age.  Our advocates give valuable resources for our clients.  Surround yourself with compassionate people who speak up on your behalf.  Understanding your rights is the first step of empowerment!!!

With over 36 years of clinical experience in Critical Care nursing, home based health care and expertise as a cardiovascular nurse clinician, Teri is well acquainted with the complexities of the modern healthcare system. She has served as a nursing leader, mentor, educator, and consistent patient advocate throughout her career in some of the best hospitals across the country. Her passion to keep the patient at the center of the model of nursing care led her to incorporate NShore Patient Advocates, LLC in 2011, serving clients throughout the northern suburbs of Chicago.

For a no-cost 30 minute initial consultation, please call 847-612-6684 or click here to fill out our online callback request form.