Claim Adjudication known as procedures, can be quite a chore when trying to access health services. There are so many components to it that aid the decision-makers in their final choice. Many people have said that there are so many hoops to jump through that it is almost impossible to comprehend.
Similarly, reimbursement processes begin when the claim is submitted, which means that the health care services are rendered. The medical records, as well as the billing codes that correspond to the treatment, are sent to the insurance company. First and foremost, there is a submission of the claim, which then leads to the verification process. It allows the accuracy of the billing codes and that the claim is compliant with the policies.
What Is the Claim Adjudication Process in Healthcare?
Claims adjudication in medical billing is the step where payment is made against a healthcare claim. Therefore, during this step, the insurance company checks whether there are any outstanding queries. Adjudicate claims include the evaluation of a claim and the supporting documentation that exists about the claim within the guidelines of the insurance cover policy.
Let’s discuss claims prejudice in detail: it represents the core players within the billing framework of the insurance industry. When trying to resolve the claim discrepancy, the middlemen will do anything instead of looking for an actual solution to the claim.
Moreover, such process can take weeks to self-simple. This evaluative process ties up hundreds of billions of dollars in a never-ending cycle of claims denials and resubmissions. For an accurate and smooth claim submission for your practice with minimum denials, you may contact us at MAVA Care.
Types Of Claim Adjudication
1. Fully Approved Adjudication
This type of claim is paid and processed as submitted, with no changes made to the claim by the insurance company. The insurance company considers the claim authentic, true, and medically essential. Thus, the documentation and coding that is done are complete and correct according to the policy rules.
2. Denied Adjudication
Failure to meet standards for claims submissions is defined as a denial. Insurers make this subjective decision based on incorrect coding and missing details, with a medically unnecessary and insufficient reason to support the claim. So, most multi-payer denials claims are at the first submission, delaying payment a month or more and requiring additional follow-up.
3. Partially Granted Adjudication Decision
In this case, payment has been granted, but only up to a specific limit. The insurance adjuster is allowed to omit certain services because of applicable policy limits or some other medical reasons. Some providers will have to write off some of the cost, and some patients may have to pay out of pocket. These may result from deductibles, co-payments.
4. Under Review Adjudication
These claims need further explanation before arriving at a conclusive decision. Additional information, for example, a specific form of medical documents. These claims are subject to manual assessment by the insurance adjudicators. The slow movement of claims can have an impact on provider payments and patient charges. It includes a quicker process of claim’s submission from the providers.
5. Lower Cost Adjustment
This is the case where an Insurance Company uses their deals or discounts. Providers, in this case, may face payment cuts due to the fee schedules and the agreements made with the networks. Patients may as well notice a change for the worse in their copay amounts. Knowing the terms of the contract helps in proper billing.
Medical Claim Adjudication Example
One of the healthcare providers submits a claim for a psychiatry evaluation against one of the insurance companies. The claim also goes through coding compliance and medical necessity checks. When all is in order, the claim will be accepted for payment and the payer will reimburse according to the money fee schedule.
Furthermore, if a claim contains errors such as incorrect CPT codes or prior authorization non-compliance, it will only be paid until the errors are fixed. The insurance company that processes the claim may also deny payment if certain conditions exist. By contrast, an evaluation may be requested, but there is no referral on record; in other cases.
The Step-By-Step Claim Adjudication Process in Healthcare
1. Claim Submission
Usually, it begins with a healthcare provider like a hospital, physician, or laboratory filling the claims to an insurance company. An insurance company will first review a claim after receipt. In addition, the first check involves seeing whether the patient’s details, along with the physician’s details and their National Provider Identifier (NPI), are valid. Hence, the claim may be rejected for issues such as incorrect patient details, improper service codes, wrong dates, incorrect diagnosis codes, and invalid health plan numbers.
2. Claim Review
There are two types of claims review: automatic and manual. In the automatic review, claimants seek specific items in the claims relevant to the insurance payers’ policies. Afterward, an electronic claim is sent to the medical review office to commence the manual medical review process.
3. Payment Processing
At this point in the payment processing stage, insurers have the discretion of paying a claim or writing it down. When you paid the amount, the payer decides whether the claim needs reimbursement or not. Claims are cut down when the level of service. Additionally, the procedure code may be offloaded to an appropriate lower level by the claim’s examiner. On the other hand, when the claim is not rebuttable, payers are at liberty to reject a claim.
4. EOB and EOP Generation
After a claim is accepted, the patient is issued an explanation of benefits (EOB) along with a piece of remittance advice as an explanation of payment (EOP) for providers. The notice provides information about benefits and payments, reasons for reductions in payment, adjustments, any denials.
Benefits of Medical Claim Adjudication Services
Here are the benefits of the claim adjustment services:
- The prompt and accurate assessment of claims lays the groundwork for the swift processing of payouts since providers can bypass unnecessary thorough examination of claims.
- Verifying patients’ eligibility, coverage, and compliance rules is part of medical claim adjudication services to avoid claim denial and rejection.
- Providers of healthcare services are always certain of getting paid when they submit their claims within a reasonable period due to steady and predictable cash flows.
- Adjudication services involve the verification of medical codes, patient data, and relevant documents to remedy low claim acceptance rates and minimize further mistakes.
- Such services ensure that the claims conform to the insurance company’s internal policies and statutes, thereby minimizing non-compliance risks.
Closing Remarks
A medical claim adjudication is an essential approach when assessing coverage, validity, and payment eligibility. The checks give room for compliance, reimbursement, and accuracy. Therefore, the correct handling of such payment transactions increases the inflow of cash to healthcare institutions while also decreasing payment denial cases. Proper approaches enable insurance scheme applications to be free of conflicts, errors, and fraud.
“Adjudication” of healthcare claims is one of the proactive measures when protecting the organization. Interventions aid the organization in retaining financial stability while making certain that the patient receives their full benefits of coverage. Are searching for some virtual team that hanks all the billing, coding, credentialing and claim processing tasks for you? If so, reach out to us at MAVA Care.
FAQ’s
What is the role of an adjudicator in regards to claims?
They scrutinize assigned insurance claims for accuracy, eligibility of the patient, ensures there is enough coverage in the policy, and finally, accepts or rejects claims as per pre-set criteria.
How long does the adjudication process take?
Generally, adjudication requires somewhere between 30 and 45 days. In the case of electronic claims submission, it is possible to complete the process in 7 to 14 days.
What is the meaning of adjudication?
Examining legal disputes or claims made by clients against insured persons or companies and making appropriate decisions about making payments under policies is known as adjudication.
What’s the procedure of the adjudication process?
Claim submission → Claim initial processing → Claim review (automatic/manual) → Claim determination (approved/denied) → Claim payment or appeal processing.
