Kathleen Wessel (Host): Denials are more complex than ever.
The pressures coming from every direction.
We need to look at this problem holistically and stop treating
denials like just a billing problem.
Hello and welcome to a HA Associates Bring Value, a podcast from the
American Hospital Association.
In this series of podcasts, we speak with a HA associate program, business
partners check in on their healthcare initiatives and learn how they support
a HA hospital and health system members.
I'm Kathleen Wessel, vice President of Business Management and
Operations at the a HA, and today I'm joined by Lyn Morrissey, chief
Medical Officer at Coral Health.
Dr.
Morrissey will explain how denials management can prioritize the right
cases, reduce low value effort.
Turn into an opportunity for clinical, financial, and operational alignment.
Together we'll learn how to go from reactive to strategic.
Lyn, welcome back to the podcast.
Jerilyn Morrissey: Hi, Kathleen.
It's always a pleasure to talk with you.
Thanks for having me today.
This is perennially
Kathleen Wessel (Host): an important discussion, so I wanna dive right
in with that first question for you.
Really learn kind of what you're seeing in the field, what you're experiencing.
So field continues to look for innovative strategies to address
complexity of claim, denial, manage.
What are hospitals missing when they treat denials as a billing
issue or a documentation problem?
Good question.
Jerilyn Morrissey: Whenever we talk about managing denials, I always get a mental
image of that scene from the Peanuts gang.
You know, the one where Lucy holds the football for Charlie Brown, and every
single time he goes to kick it, she pulls it away and he ends up flat on his back.
That's the perfect imagery.
It's always a moving target.
And I think you used the word complex earlier.
It is so substantially more complex than most people can
comprehend in the real-world.
There are endless types of denials out there.
Prior authorization, notice of admission, medical necessity, level of care, DRG
downgrades, 30 day readmissions, line item denials seemingly grows every single day.
Volume alone is overwhelming And the response is not a one-size-fits-all.
Managing the spectrum of denials is a daunting task when frequently
more than one type of denial applies to the same encounters.
Right now, on average, hospitals are spending nearly, you know, $20
billion annually to fight denials, and they're often doing that by
throwing more resources at the problem, hoping that something will just be
a panacea for the pain they're in.
But more doesn't always mean better.
In fact, it often adds complexity without actually adding real impact.
Because our goal here is appropriate and compliant reimbursement.
That's the goal.
And so when we lose sight of that goal, we end up with more,
but we don't end up with better.
I think strategically they are one sided, they benefit the payer.
The burden of proof is.
Ultimately on the provider while the payer, it's judge.
And so if there's a disagreement or if there's a tie in the conversation, the
win always goes to the judge And the jury.
It never goes to the provider.
It's extremely imbalanced.
So the most common thing that I see in terms of a miss in dealing with denials
is an approach to denials, And that treats them as a back office problem.
When really they need to be treated as part of an end-to-end
strategy because denials don't start at the point of billing.
They start with documentation, with utilization decisions, with
status, with coding, and absolutely everything else in between.
So ideally, those touch points would integrate in the denial management
strategy from the beginning.
Kathleen Wessel (Host): No, that makes complete sense.
The preparation ahead of time kind of eases some of that
decision-making or impact of some of those decisions long-term.
I wanted to just take a brief pause here and could you share with the audience a
little bit about your professional journey And what brought you to Coral Health
And the work that Coral Health is doing.
So
Jerilyn Morrissey: my professional journey, I started off as a
primary care physician, and I'm a little reticent to say it, but
I've actually been a practicing physician for over 25 years now.
That number gets bigger and bigger, faster than I'd like.
And you know, I started off at site as a primary care doc and I've
worked subsequently in both payer and health system leadership positions.
And as you mentioned, right now, I currently serve as the Chief Medical
Officer at Coral Health, where we are committed to helping healthcare
organizations of all shapes and sizes navigate between payers and providers.
Our goal is to facilitate smoother operations and effective revenue cycle
management with a comprehensive suite of innovative technologies that focus
on enabling faster, more efficient, more compliant revenue reimbursement.
Kathleen Wessel (Host): I've always thought your, your background and just
the different experiences that you have really kind of lends itself to a
very informed kind of position on this.
So I, I appreciate the thoughts that you bring to this discussion
overall, so thank you for that.
What does a strategic approach to denials management look like?
Jerilyn Morrissey: A strategic approach really starts with a proactive strategy
instead of a reactive response, it requires an objective understanding
emotionally and intelligently as to what is in your power to control And
what is outside your realm of control.
Payers use denials as a cost containment strategy.
Providers cannot control that.
They cannot impact that.
They cannot control when there are pressures on payers to dial that
strategy up or dial it back and attempts to try to predict or even prevent
denials based on those mindsets, often does more harm than good.
So a strategic approach requires the clinical teams And the financial teams
to be working from real-time data that shows where the most egregious
behavior is occurring, And then creating a proactive and measured response.
I think you've probably heard me say that for most things in my
life, I live by the 80 20 rule.
And when you apply that to denials, that means 80% of your denials are
coming from 20% of your encounters.
And all too often we kind of take this reactive, boil the ocean response
when if we're more proactive And we understand the 20%, we will have an 80%
improvement in our denials management.
So
Kathleen Wessel (Host): healthcare leaders often think adding more
resources will help resolve denials, but this isn't always the case.
So where have you seen a less is more approach succeed.
Jerilyn Morrissey: You know, in my experience, more rarely means better.
It often adds complexity and distraction without real impact.
We end up creating a bunch of KPIs or metrics that help us measure them more,
And we lose sight of the end goal.
And I think right now many hospitals are seeking technology driven solutions that
help them to write more appeals letters.
And I understand that that line of thought, um, it's
essentially a volume play, right?
More letters means more revenue, but the question is, does it really?
Denials are coming in at such a rapid clip and denial teams
are absolutely overwhelmed.
So layering in technology to write letters seems like a value proposition.
And it is to an extent, but only a small extent.
On average, a case is overturned by an appeal letter around 20% of the time.
So the question you have to ask yourself is, can you generate enough additional
volume of appeals letters with this approach to net a significant improvement
when you only have a 20% overturn rate with letters in the first place?
This approach also assumes that denials are static.
But as we all know, payer policies are complex, ever changing, and
absolutely inconsistently applied.
I think about, you know, just last month when a particular Medicare
Advantage payer, and I won't name names, completely rewrote the rules of
engagement for denials, and assuming that they move forward with their plans.
They will have successfully eliminated denials while not increasing
payment, and to add insult to injury.
Their proposed new approach would also avoid every mousetrap providers
have set to both identify a denial and trigger the writing of an appeal letter.
So having more appeals letters going out the door isn't going to solve that problem
that just popped up and these things pop up all the time it's ever changing.
So before most hospitals have even implemented technology written
appeals letters, that they are on the path to becoming obsolete.
So what we've learned is that alignment only happens when strategy
is rooted in medical necessity, not just revenue optimization.
It needs to make clinical sense first so that you can reduce rework, And then
it becomes part of care delivery, not something that's bolted on afterwards.
Kathleen Wessel (Host): What you're describing makes perfect sense.
And while you were talking the, the peanuts analogy just kept front of mind.
It feels like what's happening and you're reinforcing That
is exactly what's happening.
For some organizations, denials often expose the friction between, you
know, clinical care documentation and reimbursement, And what you've started
to touch on here, how can hospitals build alignments across those domains?
Jerilyn Morrissey: I have this conversation with a lot of people and
I, I've kind of coined the phrase that documentation has become the workhorse
of everything we do in medicine anymore.
Taking that a step forward, I'll say it has become the battlefield.
The battlefield where financial, clinical, and payer priorities.
All collide, and one aspect of our strategy is to create alignment
without creating administrative overload, because that administrative
overload, its attention.
Every organization is feeling out there.
Right now, the levels of physician and practitioner and nursing
burnout are at all times high.
And the reality is.
Documentation lives at the intersection of many, many, many competing
priorities for organizations.
And so when hospitals try to solve that by adding more layers, more requests
for documentation, more reviews, more queries, more documentation,
you get that administrative overload And that clinician disengagement.
Like I said, denials don't start at the point of submitting a claim.
They start with documentation.
They start with utilization decisions, they start with status, with
coding and everything in between.
So the ideal system would integrate those touch points from the beginning.
The output of clinical teams and financial teams working from the same playbook is
not to change clinical care, but to ensure they tell the full story in a way that's
defensible and compliant and reimbursable.
And lastly, I'll just say I want to see resources being deployed
based on risk and impact.
Not every case needs the same level of attention.
High-risk DRGs, high dollar denials, or repeat patterns that show up
in the data And the analytics.
That's where you invest.
That's how you build something that's scalable, sustainable,
and truly strategic.
Now where we've seen success is with organizations that streamline, they focus
their teams on the highest value work.
I think about a health system we worked with recently.
They took the approach of tightening their clinical validation process and
focusing only on high impact cases.
They significantly reduced query volume, but still saw improved revenue.
So they divorced those kind of transactional process, measuring
KPIs and focused on what they really wanted to achieve, and at the end they
got fewer queries, better results.
And that's the kind of less is more success we need across the board.
Kathleen Wessel (Host): Maybe stemming from that example, or perhaps you've
got another way to think about this.
If you had to advise, you know, hospital leaders on one change that they can
make that would improve denials outcomes over the next year, what would it be?
Yep.
Couple
Jerilyn Morrissey: of different things that I would say.
First of all, you need to look at where the puck is going and
not where the puck is at, right?
You need to start thinking about denials in a very different way
because things are changing in reimbursement models very rapidly.
I think the catchphrase that's out there in the ether, denials
prevention has created a culture.
That exists with it, and unfortunately, associated with that denials prevention
culture is this idea or this stigma that the more denials I have, the more
wrong I am, the worse I am at my job.
I'm performing poorly because I have so many denials and nothing
could be further from the truth.
Denials are a payer strategy.
They're not concerned with right or wrong, good or bad.
Your performance in terms of your own internal processes,
denials, distract and they delay.
And while hospitals chase those shifting rationales that we've been talking
about and approaches to denials, our teams have no hope of keeping up.
It's truly madness, in my opinion.
It's like a, a hamster in a wheel, just, you know, running endlessly trying to
reach the end line that they can never.
Should we do everything possible upfront to be accurate and correct?
Yes, absolutely.
We should document thoroughly and accurately.
We should have clear clean processes and claims, but we need to stop
changing our approach every time a payer denial behavior shifts, our approach
should be based on strategy, not the response to somebody else's strategy.
So for denials management, like so many other things in life, the
best defense is a good offense.
Kathleen Wessel (Host): I think That is very sound advice.
Sterly.
I wanna thank you so much for joining me today outlining this topic, and
kind of walking us through some of the things that you're saying.
I think it's been incredibly valuable, so thank you for
sharing insights with our members.
For our listeners, if you'd like to learn more about Oral Health,
please visit www.coralhealth.com.
If you'd like to learn more about the associate program,
please visit us@sponsor.aha.org.
This has been an AHA Associates bring value brought to you by the
American Hospital Association.
Thanks for listening.