Q&A: Responding to a pre-payment denial

Q: Can we correct and resubmit a claim denied before payment as we do claims that are sent back with a pre-payment rejection?

A: Although it happens rarely, Medicare can deny claims prior to processing them for payment. Medicare is more likely to reject a claim than to deny one. A rejected claim can be corrected and resubmitted for payment, but a denied claim must be appealed.

For example, if a bariatric surgery claim is submitted without the appropriate medical diagnosis to indicate that the patient’s body mass index (BMI) is greater than or equal to 35, the claim will be denied. Upon receipt of the denial notification on the electronic remit advice (ERA) also referred to as 835 or the paper remit, the hospital will have to appeal the denial by requesting a redetermination by submitting form CMS-20027 accompanied by the patient’s medical records. If the redetermination resulted in a denial, then the hospital will have to submit a second-level appeal by requesting a reconsideration.

Fore more information, see The Contemporary Guide to Patient Financial Services.