The Ins and Outs of Insurance Verification and Authorization

The importance of insurance verification is highlighted by the fact that expired eligibility and lack of coverage by a particular plan are some of the most common reasons for claim denials. In 2013, these two were among the top five reasons for claim denial, according to research by RemitData. There can be nothing as disconcerting as not receiving payment for the services you have rendered.

That’s why it is important that you put in place an efficient process for insurance eligibility verification which can help you reduce the chances of such denials and raise the all important bottom line for your practice. If it is exhaustive to set in place such a process, think of outsourcing insurance verification services to an experienced company. But make sure this is taken care of efficiently.

The golden rule is, and you’d know this from experience, to verify insurance coverage and eligibility for the particular clinical service before you provide it. It should not be a back end task.

Insurance Authorization before Verification

Specifically, when you’re verifying the insurance your practice must have a few procedures in place:

Remember, in the case of hospitals it is essential for the medical office to ensure the required steps for insurance authorization have been taken by the physician office. The physician office renders the services but denied claims would affect the revenue of the hospital and not the physician’s office.

Authorization is the first step towards verification, and it begins at the physician office where the patient arrives for consultation and eventual treatment. Though the hospital gets affected due to denied claims as a result of failed prior authorization, it is the responsibility of the physician’s office to carry it out. The hospital must therefore ensure the physician’s office gets this done for each patient.

All that the medical office needs to do is to ensure the required steps have been taken to carry out prior authorization by the physician office.

Ensuring Insurance Authorization Has Been Done Immediately after the patient gets scheduled for some procedure, the process of insurance verification must start. That’s when the medical office must contact the physician office to know if it has obtained the authorization from the insurance company for the procedure.

If the physician office has carried out the authorization, you need to secure the authorization number from them. Ideally, the physician office should do it.

If the physician office does not have the number, the medical office must secure it by contacting the insurance company’s concerned department. Also, use this opportunity to ensure the patient information the insurance company has matches what’s in your records.

If the authorization process has not been carried out by the physician’s office, you need to inform them that they must get it done before the patient’s procedure is carried out.

Checking for authorization is very important and it is never safe to assume that the physician office has obtained it, though obtaining authorization is one of their responsibilities. So keep following up with the insurance company.

In the event of a last minute change in procedure, the insurance company must be contacted immediately so the changes can be added to the authorization. Remember, pre-authorization is always important since various insurance companies have their own requirements. It applies to Medicare and Medicaid as well.

Now let’s get into the all-important insurance verification process.

The Process of Insurance Verification

Verification is all about gathering information:

It begins by asking the patient for a copy of their insurance card even if the patient states that their insurance has not changed. The updated image of the card should be added to the patient’s electronic health record since it serves as informational backup. Your billing team must check the ID number against the card before the claims are sent.

It is wise to always contact the insurance provider directly for ensuring eligibility, rather than simply relying on the information on the cards. Calling through the provider hotline is one way to do it. An EMR integrated with a billing system could help ping Medicare, Medicaid and such larger payers for eligibility data. Installing electronic eligibility systems for the payers is quite an efficient option. They could also help you to directly import data into EMR systems, which helps avoid data entry errors and makes the process faster.

Make sure to record accurate information since that forms the basis of the medical claim. Errors here could lead to denials or payment delays lasting for many weeks. Your staff should therefore take great care in transcribing the information into the patient’s record.

As and when required, it is important to keep in touch with the patient regarding insurance information. Having a patient portal is highly useful so patients can be reliably informed of eligibility. Whatever be the means, the patient must be informed as soon as possible regarding out-of-pocket expenses.

Verification Checklist

Here’s a checklist of things you must get verified:

Insurance name

Phone number

Claims address

Insurance ID and group number

Name of the insured individual

Relationship between the insured and the patient, if the patient isn’t the insured individual

Effective policy date

End policy date

How active the coverage is

Coverage of the insurance – procedure, diagnosis, services, etc

Participation of your practice with the plan

Policy limitations - exclusions or bill documentation requirements

Requirement of referral, pre-authorization certificate proving medical necessity, etc

Co-pay and deductible amount

With this checklist in mind, you can make sure you don’t leave anything out that would cost your practice the earnings it deserves.

Of course, that is quite a lot to take care of, and you need dedicated insurance verification and authorization professionals to handle this.

OSI provides RCM services for dental and medical practices of all sizes and specialties. Services include billing, insurance verifications, prior authorizations, coding, A/R management and more.