Fixable denials: the money you earned but never collected

When a practice grows, charges grow first. Collections should follow a few weeks behind. When they don't, the claims that paid usually aren't the problem. The money is in the claims that came back.

Most of those denials can be fixed. Someone corrects the claim, sends it again, and it pays. But someone has to find the time, and in a busy office the time runs out before the denials do.

The example above follows $200,000 of claims from one month. 92% pay the first time. Of the $16,000 denied, $14,000 is fixable, and the billing team reworks what it can. The $4,000 it never reaches is written off. That's $48,000 a year the practice earned and never collected.

The terms billers use

• Charges are what you bill at your own fee schedule. Payers pay the amount in their contract, and the difference is a contractual adjustment. That gap is expected, so measure collections against what your contracts say you're owed.
• Denial rate is the share of claims denied the first time they're sent. In MGMA's 2023 data, it was 8% for single-specialty practices.
• A rejection happens before the payer reviews the claim, usually for a formatting or eligibility problem caught at the clearinghouse. Fix it and send it again.
• A fixable denial (billers also say soft denial) was reviewed and refused for something correctable: a missing side, two codes that can't be billed together, missing records. Corrected and resent, it pays.
• A final denial (or hard denial) is one the payer got right, like a service the plan doesn't cover or a claim filed past the deadline. That money is gone.

Why fixable denials get written off

1. Denials grow with the practice. More visits mean more claims, and more claims mean more denials. Your billing team's hours stay the same, so the backlog grows. This is how charges can climb while collections stall.
2. Every rework is slow. Each one means re-keying the claim, often checking with the provider, and waiting again. A billing lead at a family medicine practice told us a corrected claim pays in 30 to 45 days, versus 7 to 14 for a clean one.
3. Fixable denials expire. Every payer sets deadlines for corrected claims and appeals. A fixable denial nobody reaches in time becomes a write-off.

None of this is a people problem. Your billers know how to fix these denials. There aren't enough hours to fix them all.

What to watch each week

A short weekly look at your billing system's denial report covers most of it:

• Denial rate: compare it to the 8% benchmark and to last month.
• Fixable denials waiting: dollars and count, by payer.
• Oldest fixable denial: how close it is to that payer's deadline.
• Written off without rework: the number that tells you the backlog is costing money.

Fewer denials, starting in the chart

The cheapest denial to rework is the one that never happens. Many fixable denials start in the chart, where the codes are picked:

• Codes that can't be billed together. I12.9 (hypertensive chronic kidney disease) with I15.0 (renovascular hypertension) can get the whole claim denied. More on these code pairs.
• A missing side. M25.569 is knee pain with no side given. If the note says right knee, the code is M25.561.
• A visit level the note doesn't support. If the payer asks for records, the note has to back the level billed, up or down. Here is a quick check.

Each one caught before the claim goes out is one less denial in the pile, and fewer new denials means your billing team's hours cover more of the ones that remain.

Cortex Lens checks every Practice Fusion chart for these problems before the claim goes out. Your team makes the fix in Practice Fusion; Lens never changes the chart. The impact page counts the denial risks caught and the ones fixed, for the last week, month, or quarter.

Sources: MGMA Stat, March 6, 2024, citing 2023 MGMA DataDive Practice Operations data. The example practice is illustrative. Turnaround times are from a billing lead at a family medicine practice.