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How a Large National Payer Reduced Medicaid Denials

Availity Editing Services prevented claims with errors from reaching adjudication

Challenge

A large, national payer was experiencing a high volume of Medicaid claims with errors in one state. This caused higher administrative costs as payer staff worked to address the errors with providers. This also meant claims sat in pend status for a longer period of time, driving an uptick in prompt-pay financial penalties.

Solution

Because the payer was on Availity’s Intelligent Gateway, they opted to implement Availity Editing Services (AES), an editing solution that sits within the Intelligent Gateway and evaluates claims before they reach the payer. Claims with errors are returned to the provider with an easy-to-understand explanation. Using the Payer Guidelines editing package which evaluates claims against a payer’s own source information, this payer found that many of the claim errors were triggered by specific NPI conflicts.

Results

The payer went live with the Payer Guidelines editing package in February, and by June they had seen an approximately 30% reduction in denials. They were also pleasantly surprised to see an immediate impact on certain common errors. These edits contributed to a reduction in annual penalty fees that represented approximately $500,000 in savings, as well as a reduced administrative rework
cost of approximately $6,000/day.

They also received positive feedback from providers. According to the Associate Director of Medicaid Claims and Encounters, “One provider told us the edits have allowed them to catch and fix errors quickly versus managing a claim denial that could take weeks. They thanked us for this effort.”

BaselineMedicaid Case Study
12,04712,727
12,04710,072
12,0478,454
12,0478,179
12,0478,473
12K to 8k

Over 12k down to 8k

30%

Reduction in Denials

“One provider told us the edits have allowed them to catch and fix errors quickly versus managing a claim denial that could take weeks. They thanked us for this effort.”

the Associate Director of Medicaid Claims and Encounters

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