Skip to main content

Why Medicare Advantage Service Claims Are Denied:
A Guide for Seniors & Retirees

image

 

Over the past decade, we’ve observed a trend in billing issues among Medicare beneficiaries, whether they have Medicare Supplement or Medicare Advantage plans. These issues often lead to stress and confusion, especially when unexpected bills arrive. Reacting without investigating these bills can result in higher out-of-pocket costs. To help you navigate these challenges, here are some common reasons why carriers might deny Medicare Advantage services or claims.


Key Points:
  1. Understand the importance of medical necessity in claims approval.
  2. Learn the significance of obtaining prior authorization.
  3. Avoid common administrative errors that lead to denials.


These issues often lead to stress and confusion, especially when unexpected bills arrive. Reacting without investigating these bills can result in higher out-of-pocket costs. To help you navigate these challenges, here are some common reasons why carriers might deny Medicare Advantage services or claims.

Lack of Medical Necessity 

One of the primary reasons for denial is the determination that a service or procedure is not medically necessary. Medical necessity refers to services or supplies needed to diagnose or treat an illness, injury, condition, disease, or its symptoms. These services must meet accepted standards of medical practice. Key elements include:

  • Purpose: The service is provided for the diagnosis, treatment, cure, or relief of a health condition.
  • Standards: The service meets accepted medical standards and is not experimental or cosmetic.
  • Appropriateness: The service is necessary and appropriate for the condition.
  • Effectiveness: The service is effective in terms of frequency, duration, and location.
For more details, look out for our blog on Medical Necessity.


Prior Authorization Not obtained

Many Medicare Advantage plans require prior authorization for certain services. This means your healthcare provider must obtain approval from Medicare before providing the service to ensure it will be covered. This process helps control costs and ensures treatments are medically necessary.

Key points about prior authorization include:

  • Purpose: To confirm the medical necessity of the service.
  • Process: Your provider submits documentation to Medicare for review.
  • Timing: Approval must be obtained before the service is provided.
  • Impact: Without prior authorization, the service may not be covered, and you could be responsible for the full cost.

For more information, check out our blog on What to do when Medicare Advantage Service or Claim is Denied.

Administrative Errors

Simple mistakes like incorrect coding, missing information, or clerical errors can lead to claim denials. Medicare billing coding involves using standardized codes to describe medical diagnoses, procedures, and services. These codes ensure that claims are processed consistently and accurately. The main coding systems used in Medicare billing include:

  • ICD-10: Codes for diagnoses and symptoms.
  • CPT: Codes for medical, surgical, and diagnostic services.
  • HCPCS: Codes for services, procedures, and equipment not covered by CPT codes.

These coding systems are essential for effective communication between healthcare providers and insurers, ensuring claims are processed efficiently.


Out-of-Network Providers

Using out-of-network providers is a common reason for Medicare Advantage service denials. When beneficiaries seek care from providers not in their plan’s network, carriers may deny the claim, leaving beneficiaries responsible for the full cost. The No Surprises Act of 2022 addresses this issue by prohibiting balance billing for emergency services and certain non-emergency services provided by out-of-network providers at in-network facilities unless specific notice and consent requirements are met. This act aims to protect patients from unexpectedly high medical bills and ensure cost-sharing amounts are limited to in-network levels.

Service Not Covered

This occurs when a service or treatment is not included in the specific Medicare Advantage plan’s benefits. Each plan has a defined list of covered services, and if a service falls outside this list, the insurance carrier will deny the claim. Beneficiaries should review their plan’s coverage details to understand what is included and consult with their provider to ensure services are covered before receiving treatment. This helps avoid unexpected out-of-pocket expenses and ensures that necessary care is within the plan’s scope.

Duplicate Claims

Submitting the same claim multiple times can result in denials from Medicare Advantage carriers. This often happens due to administrative errors or misunderstandings, where the same service is billed more than once. When a duplicate claim is identified, the insurance carrier will reject it to prevent overpayment. To avoid this issue, it’s essential to ensure that claims are accurately tracked and submitted only once. Proper documentation and communication with the billing department can help prevent duplicate submissions and ensure that claims are processed smoothly.

Timely Filing

Medicare Advantage plans require that claims be submitted within a specific period, known as the timely filing limit. This period varies by plan but is typically within 90 days to one year from the date of service. If a claim is submitted after this deadline, it will be denied, and the provider or beneficiary may be responsible for the full cost of the service. Ensuring timely submission of claims is crucial to avoid denials and financial responsibility. Proper tracking and prompt filing can help prevent issues related to late submissions and ensure that claims are processed efficiently. 


Eligibility Issues

Eligibility issues arise when a patient is not qualified for a specific service under their current Medicare Advantage plan. This can happen if the service is not included in the plan’s benefits, or if the patient does not meet certain criteria, such as age, medical condition, or prior authorization requirements. When eligibility issues occur, the claim will be denied, and the patient may be responsible for the full cost. It’s important for beneficiaries to understand their plan’s eligibility criteria and verify coverage before receiving services to avoid unexpected expenses.

Understanding these common reasons for claim denials can help you avoid unexpected expenses and ensure your services are covered. If you have any questions or need assistance with your Medicare Advantage plan, feel free to call Senior Help and You at 520-252-5275. Talk to a live agent, not an AI. We are here to help you.

Key Takeaways:
  1. Ensure services are medically necessary and meet accepted standards.
  2. Always obtain prior authorization for required services.
  3. Avoid administrative errors by double-checking coding and information.

Sources:

 

By: Albert Ferrin

August 2, 2024

Featured Blogs