Top 10 Reasons Why Healthcare Claims are Denied


Common Reasons for Denied Claims


Is your medical practice experiencing an abundance of denied medical claims? Typically, a claim is denied if it is incomplete or missing information that is required for a claim to be processed, or a claim that contains incorrect information. You can increase the chance of your medical practice getting the highest reimbursement by understanding the factors of a denied claim, and taking the necessary steps to prevent future error. Below are the top ten reasons why a claim may be denied:

1. Incorrect or Missing ICD Diagnoses

International Classification of Diseases (ICD) codes are located on patient paperwork, including hospital records, doctor records and death certificates. ICD codes are important to patients for various reasons. If your practice submits a bill to insurance for reimbursement – the ICD code must match to a CPT code, which are numbers assigned to every service a medical practitioner may offer a patient. If both codes do not match, a payment may be denied.

2. Incorrect or Missing CPT Modifiers

CPT modifiers indicate a service or procedure that has been altered by a specific situation but has still not changed in its definition or code. The purpose of these modifiers is to allow for special consideration for payment. The correct CPT modifiers are necessary for getting claims paid the right amount. A missing or incorrect modifier can result in thousands of dollars potentially being lost or an overpayment in services. Incorrect or missing CPT modifiers are one of the most common reasons that claims are denied.

3. Duplicate Claim

A claim that is submitted more than once from the same provider, has the same service date and same service is considered a duplicate claim. A duplicate claim will be denied and delay the claims processing.

4. Additional Information Needed to Process the Claim

If there is additional information missing a claim cannot be processed. The missing information is the responsibility of the provider so the patient cannot be billed, losing the practitioner money. Information needed to process a claim includes date of birth, sex, name, insurance ID number, address, contact information, policy number and etc.

5. Billed Amount Incorrect

The claim included a bill amount that was incorrect or missing. To make sure the billed amount is correct – all billed charges should be included on each line without using a decimal point. The billed charges must be numeric and without spaces.

6. Incorrect or Missing CPT Procedure Code

Insurers use Current Procedural Terminology (CPT) codes to determine the amount of reimbursement that a practitioner will receive based on the services they have performed. CPT codes ensure uniformity, since everyone uses the same codes to mean the same thing. However, there is a chance that CPT codes can be incorrect or missing, resulting in a denied claim.

7. Physician’s name and/or upin missing or incorrect

A unique physician identification number (UPIN), now known as a National Provider Identifier (NPI), is a six-character identifier, using both letters and numbers to identify doctors in the U.S. The Social Security Act requires that all physicians have a UPIN, and that all claims and services ordered or referred by a physician include the names and UPINs of the ordering/referring physician. If a UPIN or physicians’ name is missing it can result in a denied claim.

8. Incorrect or Missing Place of Service Code 

Physicians are required to report the place of service on all claims. The place of service code identifies where the procedure is provided. If there is an incorrect or missing place of a service code, a claim will be denied. Make sure your practice verifies that the place