A surgery practice needs full focus to help a patient recover quickly from illness.
Major surgeries, for example, include heart operations, surgeries in the bowel area, surgeries to rebuild body parts, deep tissue surgeries, and transplant surgeries.
However, individual surgeons or surgery practices simply cannot handle complex billing and revenue cycle management (RCM) issues on their own.
As a result, they often face an imbalance in clinical and financial operations. Unfortunately, this leads to a loss of revenue.
Incomplete information, unrecorded surgeries, and not following healthcare rules and payer guidelines significantly hurt operations and finances.
These problems can, quite understandably, cause payer claims to be rejected. This, in turn, creates extra work for surgeons and interrupts surgical processes and administrative tasks.
Therefore, surgical practices really need to know the main reasons for surgery claim rejections and fix them properly.
Here Are The Reasons Why Surgeons Face Claim Rejections
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1️⃣ Incorrect or Incomplete Patient Information
Incorrect patient information is a common reason for claim denials.
Like many other providers, surgeons may also face rejections from payers due to these errors.
Because insurance payers rely on the details in the claim to process payments.
Common mistakes related to patient information include:
- Misspelling a name
- Incorrect insurance ID number
- Mismatch between the patient’s birth date etc.
| How to Avoid? Double-check the patient’s information to void these rejections before submitting the claim. Use billing software to input accurate personal and insurance information during pre-operative procedures. Follow standard payer guidelines to reduce the chances of missing essential patient data. |
2️⃣ Incorrect CPT and ICD-10 Codes and Modifiers
CPT (Current Procedural Terminology) codes represent the services provided during surgery, while ICD-10 codes describe the patient’s diagnosis.
Surgery practices must ensure accurate CPT and ICD-10 codes and their modifiers.
CPT code range for Surgery 10004-69990. While ICD-10 codes for surgical procedures include:
- Y83.0 Surgical operation with a transplant of the whole organ
- Y83.1 Surgical operation with an implant of an artificial internal device
- Y83.2 Surgical operation with anastomosis, bypass, or graft
- Y83.3 Surgical operation with the formation of external stoma
- Y83.4 Other reconstructive surgery
- Y83.5 Amputation of limb(s)
- Y83.6 Removal of other organ (partial) (total)
- Y83.8 Other surgical procedures
- Y83.9 Surgical procedure, unspecified
The surgeons should also use correct modifiers.
For example, Medicaid offers a Global Surgery Package for proper reimbursement. The modifiers that surgery practices can use under this package are:
- Modifier 54 = Surgical care only
- Modifier 55 = Post-operative management only
- Modifier 56 = Pre-operative care only
The payer will reject or deny the claim if these codes and modifiers are missing, incorrect, or not correctly matched to the procedure performed.
| How to Avoid? Use accurate ICD-10 and CPT codes and modifiers for the procedure and diagnosis. Utilize coding software or work with professional coders up-to-date with the latest CPT and ICD-10 updates. Regularly audit your coding practices to ensure accuracy and relevance to the surgical procedure. |
3️⃣ Lack of Medical Necessity Documentation
Insurance companies often reject claims if the procedure is not medically necessary.
For surgical practices, surgery must be deemed essential for treating the patient’s condition and supported by clinical documentation.
The payer may reject or reduce the claim amount without sufficient evidence of medical necessity.
So, a surgeon needs to prove the surgical procedure is medically necessary.
Otherwise, the payer may deny the claim for lack of medical necessity.
| How to Avoid? Document the patient’s medical history, previous treatments, and why the surgery is required. Include supporting documents such as imaging results, physical therapy records, and detailed notes from consultations. Provide clear and comprehensive documentation to prove the medical necessity of a surgical procedure. |
4️⃣ Pre-authorization Requirements Not Met
Many insurance plans require pre-authorization for certain surgeries to ensure the patient’s policy covers the procedure.
If pre-authorization is not obtained or the authorization is not documented correctly, the payer will reject the claim.
| How to Avoid? Always check the payer’s requirements for pre-authorization before performing any surgery. Always request pre-authorization for high-cost surgeries or elective procedures in advance. Keep track of authorization approvals and ensure they are correctly filed with the patient’s records. |
5️⃣ Out-of-Network Provider Issues
If the surgeon or the facility providing the service is out of network, the payer will reject the claim.
So, a surgeon or surgery center must be in-network with the payer.
| How to Avoid? Verify your network status with each payer to remain in-network with payers. Additionally, seek prior authorization for the procedures. Keep all contracts and credentialing information up-to-date with payers before delivering surgery care to patients. Inform patients about your network status before scheduling surgeries to avoid delays or confusion during the billing process. |
6️⃣ Duplicate Claims Submitted
Like other specialties, surgical providers also face duplicate claims. It is a common reason that surgeons should avoid.
This can happen unintentionally when surgeons resubmit claims due to initial rejections.
As a result, the payer will consider it a duplicate claim and reject it immediately.
| How to Avoid? Ensure a robust claim tracking system is in place. Cross-check the status of claims before resubmitting them. Use a claims management software that automatically flags duplicate claims and ensures all resubmissions are legitimate. Regularly reconcile your billing records to confirm that each claim is unique and has been processed. |
7️⃣ Services Billed Under the Wrong Provider
Sometimes, surgical practices bill the services under the wrong provider’s name.
For example, a surgical procedure is performed by a physician assistant or another surgical team member, but the claim is billed under the surgeon’s name.
In that case, the insurance payer might reject the claim and reduce the reimbursement rate.
| How to Avoid? Ensure the proper provider is listed for the service rendered. If multiple healthcare providers are involved in the surgery, detail their respective roles accurately. Includes proper documentation of the physician assistant, resident, or other healthcare providers participating in the procedure. Set up a clear protocol for billing and documenting services provided by different team members. |
8️⃣ Outdated or Incorrect Fee Schedules
Each insurance company maintains a fee schedule for different services and procedures, which outlines the allowable amounts for each surgery, such as Medicare’s Global Surgery Package.
If the fee schedule provided by the payer is outdated or incorrect, it can lead to claim denials or reduced reimbursements.
In addition, surgical practices may experience this issue if they use old fee schedules or fail to track regular updates from insurers.
| How to Avoid? Stay up-to-date with fee schedule changes from all insurance payers and check for any revisions in reimbursement rates. If there are discrepancies between the billed amount and the payer’s allowable amount, work with the payer to resolve the issue. If the fee schedule is outdated or incorrect, document the correct rates and provide supporting evidence to appeal for higher reimbursements. |
Conclusion
Claim rejections are a frustrating part of the administrative side of surgical practice.
However, by understanding the root causes and taking proactive steps, surgeons can minimize these denials and ensure smoother, faster reimbursements.
Remember, taking preventive steps can save your surgical practice from headaches down the road and ensure your patients get the care and attention they deserve without unnecessary financial delays.
