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Common billing errors and how to avoid them

In home health and hospice, most billing errors occur during the intake process, when entering incorrect patient or payor information, adding invalid diagnosis codes or authorization, or ordering services not covered by the payor. The good news is these errors can be avoided by staying vigilant, keeping communication open and following through with efficient workflows.

In this blog, we explore three common billing errors and how to avoid them.

What’s the difference between rejected claims and denials?

A rejected claim is one that contains one or many errors found before the claim is processed. The clearinghouse may identify the rejection issue or the payor may reject the claim when you submit the billing. These errors prevent the insurance company from paying the bill, and the rejected claim is returned to the biller to be corrected.

Denied claims are claims that the payor has processed and deemed unpayable. These claims may violate the terms of the payor-patient contract, or they may just contain some sort of vital error that was only caught after processing. Payors will include an explanation for why a claim is denied when they send it back to the biller.

3 common billing errors in home health and hospice

  1. Incorrect patient informationMisspellings or incorrect information on patients’ insurance IDs or demographic information can cause major problems in medical billing. Common examples are the incorrect subscriber identification number or the patient’s date of birth. With multiple people having a part in this process, human error is more likely to occur and any mistake can stay on the record through the claim process.


  2. Claim formatting errors: Medical billing rules and regulations are changing on a regular basis. Different payors may require different billing codes and billing forms. This requires constant updating of software and electronic health records (EHR) systems. Training staff and developing new procedures are also needed to stay on top of constant changes within the healthcare industry.


  3. Non-corresponding treatment and diagnosis codes: Billing codes and diagnosis codes must be supported by the medical records. Often claims are denied because the diagnosis code does not correspond with the treatment code or something in the required medical documentation doesn’t support the billing information. It’s important that the clinical information is documented accurately and thoroughly, as compliance is key for medical billing. And since specific diagnosis codes are deleted each year, it’s important that your coding team is current on changes to diagnosis coding.

While these billing errors are common, your organization can prevent them through focus and communication, helping to ensure accurate information, coding and orders.

Request a consultation to learn how outsourcing your RCM can help reduce errors and grow your business.

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Nancy Cary

Nancy possesses a wide range of experience in the Home Health and Hospice field, including direct involvement in managing various aspects of the revenue cycle such as intake, authorizations, medical records, accounts receivable, and other related positions within Home Care and Hospice agencies. As a Senior Implementation Consultant, Nancy has successfully overseen complex software implementations for McKesson and Netsmart Home Health and Hospice. Her expertise extends to working with payors, particularly Medicare, and she is highly knowledgeable in the specific billing rules and regulations pertaining to Home Health and Hospice.

Before assuming her current managerial role, Nancy served as an A/R Consultant in the Revenue Cycle Division of HEALTHCAREfirst. In this capacity, she utilized her skills and knowledge to implement RCM services for unique and large clients, as well as assisting customers in resolving intricate A/R and billing issues. Nancy's notable strengths lie in her exceptional ability to train, develop, and efficiently manage effective teams.

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