Healthcare industry claims processors and claims-flow watchers report at least four-fold increases in rejected Medicare claims, similar or even higher rejection rate spikes for Medicaid claims, and a doubling of rejection rates for claims processed by Blues plans on May 23, the first day a federally mandated National Provider Identifier was required.
For all Medicare plans, Were seeing a rejection rate of 24%, said Miriam Paramore, senior vice president of corporate strategy at Emdeon Business Services, the Nashville-based claims clearinghouse and IT service provider. By Emdeons analysis, that represents $25.8 million in claims that were turned down, which compares with an average rejection rate of 6% or $10.6 million before May 23, she said.
For Medicaid claims processed by Emdeon, the rejection rate on May 23 was 26% compared with a normal rate of 4%; and for Blues claims, 6% were rejected that day compared with a norm of 3%, she said.
The NPI was required under the Health Insurance Portability and Accountability Act of 1996, but its implementation was delayed by HHS until last week.
This is only the beginning of the story, Paramore said. The thing hit on a holiday weekend. That introduces some kind of a lag here. It could be days or weeks before the increased claims rejection rates become a cash flow problem for providers, she said.
Cyndee Weston, executive director of the American Medical Billing Association, Sulphur, Okla., said she has received grim reports from some of the trade groups 1,400 members who run independent billing companies. Only 12 physicians in a 42-physician California group served by an AMBA member could submit claims without them being rejected, Weston said.
Martin Jensen, chief analyst and chief operating officer at the Tulsa, Okla.,-based Healthcare IT Transition Group, a healthcare consulting firm that has tracked the NPI issue and has been a frequent critic of HHS plan to go ahead with the NPI, said hes heard from a state Medicaid official who said claims flow had fallen from a normal 100,000 a day to less than 20,000. The report, Jensen said, was frightening. -- by Joseph Conn