Q&A: What is the function of a denial avoidance program?

Q: What is a denial avoidance program and how does it differ from a denials management program?

A: The fundamental objective of a denial avoidance program is ensuring that the correct processes are in place to prevent a denial from a third-party payer. These processes may span the entire revenue cycle, from obtaining proper authorizations to providing appropriate clinical reviews or billing the claim before the payer’s timely filing deadline.

Denial avoidance is not a replacement for denial management; an effective denial avoidance program works in tandem with a denial management program. The most significant difference between denial avoidance and denial management is that denial avoidance focuses on the prevention of receiving a  initial rejection. Denial management, on the other hand, focuses on properly routing account claims for review, appeal, and feedback once a denial is received.

A key overlap exists between the two programs whereby denial management communicates feedback to denial avoidance on common denial types, trends, and issues. Then, the responsibility of denial avoidance is to understand the feedback, trends, and root causes and to implement processes that will circumvent future denials. Thus, it is imperative that a healthcare organization not only improves the way it manages and resolves existing denials but also corrects process deficiencies in order to prevent new denials.

For more information, see The Contemporary Guide to Health Information Management.