The State of Eligibility Verification in Hospitals and Health Systems

[SSI Preventing Eligibility Denials Series: Part 2 of 3]

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March 27, 2023

Amid the aftermath of the pandemic and the “Great Resignation,” hospitals are facing a host of challenges, some of which pertain to eligibility verification. For one, labor shortages are looming over revenue cycle leaders, with a recent survey published in Becker’s Hospital Review showing nearly half are experiencing severe shortfalls in vital positions, from front-end revenue cycle to denial management experts. Front-end registration roles, where eligibility verification typically takes place, are bearing the brunt of this problem, becoming harder to fill as low wages and limited career growth opportunities compel hires to move on quickly.

Additionally, with the onset of federal Medicaid unwinding, providers are confronted with yet another hurdle. The Medicaid continuous coverage requirement, set to end on April 1, 2023, will trigger states to begin the process of “unwinding” coverage by reviewing the eligibility of every person enrolled in Medicaid. As a result, over 15 million beneficiaries may be affected, swelling the ranks of uninsured patients and straining providers lacking robust eligibility verification processes.

To stay on track during the unwinding process, providers should implement best practices such as regularly running insurance eligibility checks throughout the patient encounter and utilizing solutions like SSI Pre-Billing Eligibility (PBE) Edits as a final safety net for checking eligibility. By being proactive, you can minimize the potential negative impact of the unwinding process on your patients and your bottom line.

To address the labor shortage and the growing complexity of the eligibility verification process, healthcare providers are turning to technological solutions to automate workflows and successfully adapt to the changing landscape.

 

SSI Eligibility eBook cover

The Definitive Guide to Preventing Eligibility Denials

This comprehensive guide from SSI is a must-read for hospitals and health systems looking to improve their eligibility verification process and reduce claim denials related to eligibility issues. It covers the claim denial problem, the state of eligibility solutions in healthcare, and the importance of eligibility verification in denial prevention strategies. Discover best practices for effective eligibility verification and real-world examples, as well as how technology can streamline the process.

Provide your email to get the eBook.

 

The Importance of Eligibility Verification in Your Denial Prevention Strategy

In addition to recent labor shortages and Medicaid unwinding challenges, hospitals also continue to grapple with eligibility-related denials. To delve deeper into the vital role of eligibility verification in preventing these denials, we analyzed SSI’s historical claim and remit data, as well as the specific payer adjustment reason codes.

Based on $962 Billion of aggregated gross US healthcare claims adjudicated in 2022 by SSI:

eligibility verification statistics

If we continue to follow the numbers, we can better understand the root cause of denials.

Of the 66.35% of denials related to patient eligibility or coverage, 50% are due to:

  1. Non-covered charges
  2. Benefit maximum reached
  3. Service/equipment/drug not covered under current benefit plan
  4. Expenses incurred prior/after coverage terminated
  5. Patient cannot be identified

This is worth up to $15B of denials!

 Of the 33.65% of denials related to Payer/COB, 86% are due to:

  1. Care may be covered by another payer
  2. Not covered by this payer/contractor

In the aggregate, we can say that proper eligibility verification is not taking place. In this example, possible issues around appropriate processes, procedures, and tools represent $13B of potential revenue leakage.

While the losses from eligibility-related denials can be colossal, eligibility verification is key to preventing them upfront and reducing the chance of gaping holes in your revenue calculations. Even with the possibility that a denied claim can be successfully appealed and recovered, providers are still stuck with recovery costs that could have otherwise been avoided.

Talk with a specialist today about your current eligibility verification process and learn how SSI can help reduce claim denials and maximize reimbursements for your hospital or health system.