Denied: The Battle Against Readmission and Length of Stay Claims

May 10, 2023 8:00:00 AM / by Aspirion

Inpatient readmissions and length of stay claim denials are major issues in the healthcare industry. When a patient is readmitted to an acute care hospital within a certain period of time following the hospital discharge—typically within 30 days—it can lead to a claim denial by the insurance company. Similarly, if a patient's length of stay exceeds what the insurance company deems necessary, it can also result in a clinical denial.

These denials can have significant revenue cycle management implications for both the healthcare provider and the patient. Healthcare providers need to understand the reasons behind these clinical denials and take steps to prevent them.

Causes of Readmission Denials
One of the main causes of readmission denials is poor quality of care or inadequate follow-up post-discharge. If a patient is discharged without proper instructions or support for managing their medical condition, they may end up back in the hospital. This can result in a readmission denial by the payer.
Other causes of readmission denials include complications related to the initial treatment, failure to properly diagnose the patient's condition, lack of communication between healthcare providers, and patient non-compliance.

Length of stay denials can for various reasons. Often, the insurance company believes that the patient could have been discharged sooner. For instance, the patient’s condition has been stabilized but the healthcare provider determines the patient needs to remain in the hospital for continued close monitoring and other reasons. Another reason is a delay in securing a safe and appropriate discharge plan such as SNF placement.  Additionally, these denials may be due to a lack of documentation supporting the need for an extended inpatient hospital stay, failure to involve the payer in the decision-making process, or failure to provide timely updates on the patient's condition.

Preventing Readmission and Length of Stay Denials
To prevent readmission and length of stay denials, healthcare providers should focus on the quality of care and effective communication with patients, payers, and other healthcare providers as needed. This includes ensuring that patients receive proper follow-up care and education about managing their condition, as well as involving insurance companies in the decision-making process when appropriate.

Healthcare providers should also prioritize ensuring complete, accurate, and detailed documentation in the medical record and discharge planning efforts.  It is also important to ensure payers receive timely updates on the patient's condition to support the need for continued hospitalization.  To learn specific strategies within the revenue cycle/utilization management processes, hospital teams must understand how to identify and validate root causes by leveraging denial data. Recognizing the role of effective documentation to prevent and overturn clinical denials is key to strengthening processes and mitigating denial risk. 

Appealing Denials
If a claim is denied, healthcare providers and patients have the right to appeal the decision. This involves providing additional medical record documentation and evidence to support the need for the service or treatment in question.

It is important to note, appeals can be time-consuming and may not always be successful. However, healthcare providers and patients should still take advantage of this option to fight for the care and coverage that is needed.

Readmission and length of stay claim denials can have significant financial and health implications for both healthcare providers and patients. By understanding the causes of these denials and taking steps to prevent them, healthcare providers can improve patient outcomes and reduce the financial risk of denials. By working together, healthcare providers and patients can ensure that everyone receives the care they deserve.

Want to learn more?
To dive deeper into the resolution and prevention of readmission and length of stay denied claims, view our 30-minute Level up Revenue Cycle webinar here.


Tags: Denial Management, clinical denials


Written by Aspirion

Since 2008, Aspirion has offered a growing array of RCM services for hospital, health systems, and large physician groups looking for better results in managing their most complex reimbursements. Aspirion has been and continues to be a trusted partner to many of the most prominent providers in the U.S.