Top Denial Management Strategies for Higher Revenue

January 9, 2023

According to data from the American Academy of Family Physicians, 5–10% of all admitted medical claims are routinely refused. With 25% of claims being rejected, another study from the Government Accountability Office paints an even more pessimistic picture. Individual healthcare providers have different denial rates, highlighting the absence of industry standardization and the varied difficulties healthcare managing facilities and organizations face daily with denial management in healthcare.

Healthcare reimbursements and denial management services are continually changing. With a paradigm shift toward value-based and patient-centric care models, where healthcare practices bear a more significant share of risks and obligations, the Affordable Care Act (ACA) has encouraged significant changes in the healthcare environment. Care providers must reconsider their healthcare revenue cycle strategies in light of the shifting ecosystem to guarantee that the value provided to patients is fairly compensated.

A practice must keep developing by concentrating on finances and providing high-quality treatment. The cost of providing healthcare services is rising due to global inflation, and a growing rate of claim denials is one of the biggest obstacles to attaining financial objectives. The current situation calls for effective and improved denial management because it lowers the percentage. At present, achieving 100% claim acceptance appears impossible, but reducing the rate is undoubtedly in the cards. A denied claim is the most significant source of frustration for a medical billing company and provider office. Despite the task being accomplished, the payer chose not to pay due to a minor technicality or coding error.

What is Denial Management?

In healthcare, denial management determines why medical claims are denied and develops the best strategies for reducing the number of denials. It also includes implementing strategies that can increase the percentage of claims that are reimbursed first. Effective denial management consists of the following aspects:

  • In-depth analytics and reporting that provides complete visibility into the performance of a healthcare practice
  • Identification of causes behind claims denial
  • Reduced overall claim denials and increased paid claims

How Does Denial Management Work?

Denial management works on a systematic technique called the IMMP process, which stands for Identify, Manage, Monitor, and Prevent.


The first step in effectively managing denial management is determining the root reasons and causes of the claim denial. In most cases, an insurer indicates the reason for the claim denial in the explanation of the payment that accompanies the denial. These explanation indicators are commonly known as claim adjustment reason codes.


After successfully identifying the claim denial cause, the next step is to manage the denial and obtain reimbursement. The denial management team can carry out this process by following the steps below:

  • Directly Routing Denials
  • Sorting the Action
  • Developing Standardized Workflow
  • Using A Checklist


This step in the denial management procedure is essential to maintaining the accuracy and timeliness of all aspects, enabling the easy payment of this time's claim. Monitoring entails stacking your denial record based on the date received, type, disposition, and date appealed. It is also necessary to audit the work of the denial management team by supervising and sampling their appeals.


After a denial management team has gathered all the necessary information about a claim denial, the final and most important step is to launch a prevention campaign. The most common step in this process is to review your denials again to identify all aspects where you need to retrain your staff, revise procedures, or manage workflows.

Denial Management Strategies for Higher Revenue

Once you know the typical denial causes, you can change your billing procedures to prevent further denials. You will need a team of billing, coding, and accounts receivable experts who collaborate with the providers to manage medical billing denials thoroughly. Every member of your revenue cycle team should understand the value of denial management. To increase productivity, your RCM team should prioritize denial management chores in their work plan. As payers' policies and guidelines are constantly changing, it is usual to receive claim denials; nevertheless, effective denial management will guarantee that the number of these denied claims is kept to a minimum.

You can use some of the best techniques in the industry to make denial management effective and maximize revenue, such as:

- Establish a Team

To establish benchmarks, minimize backlogs, and aid in identifying root causes, it is important to identify the available resources from all departments and use their expertise to implement solutions and track and report developments.

- Organize Process

The practice's income will decrease if it loses track of denied claims, and rising denial rates may cause major administrative issues. Implement a structured denial management strategy as a result.

- Identify Trends

Track, evaluate, and record trends to quantify and categorize denials. Concentrate on data and reach out to payers for assistance with newly discovered denials.

- Act Quickly

Follow a validated process to get denials corrected as soon as possible, preferably within a week, a goal achievable when a workflow is in place to track claims as they enter and exit the system.

- Collaborate with Payers

Payers also benefit from resolving denial issues, so payer-provider collaboration can aid in addressing them more efficiently, allowing for faster system efficiency.

- Quality over Quantity

The best way to make the most of limited resources and time is to follow up on claims that have already been addressed, allowing for more quality claims rather than a higher number of lower-quality claims that yield nothing.

- Track Progress

Monitoring progress will assist in distinguishing between areas that are performing well and those that are not, as well as allowing for analysis and improving system efficiency. This allows your organization to identify areas that are performing well and require improvement.

- Conduct Performance Audits:

These should include audits of remittance advice reviews, write-off adjustments, zero payment claims, registration, and insurance verification quality.

Effective medical billing denial management ensures the financial sustainability of any healthcare practice. Practices may use external medical billing and coding service providers to supplement their internal medical billing and coding operations.


This article explained denial management, how denial management works, and top denial management strategies for higher revenue. Medical billing in talkEHR offers comprehensive medical billing services. Our RCM professionals, who specialize in the medical field, ensure that all denied claims are dealt with correctly to receive accurate and maximum insurance collections.