Did you know that up to 80% of medical claims contain at least one error? These errors can be mostly avoided, with due diligence on the billing department’s end.
Now, you may have noticed I said mostly avoided, and not entirely avoided. I hate to tell you, but unfortunately, there’s no way to ensure that claim errors never occur.
However, it is important to know there are things you can do to try to reduce the amount of errors.
If there’s an error in the claim, the insurance company will send the billing department a denial. When the billing department receives this denied claim, it comes attached with a denial code. From there, they need to find the error in the claim, fix it and resubmit it to the insurance company. Talk about delaying the reimbursement process.
The easiest thing you can do to avoid delays is to hire a clearinghouse to help scrub the claims before submitting them to the insurance company. While they’re scrubbing the claims they look for any errors in the claims.
If there’s an error, the clearinghouse lets the billing department know what the error is and how they can change it. This helps ensure there are no errors in the claim before the insurance company sees the claim.
Etactics happens to be a clearinghouse with over 25 years of experience. With that much experience, we’ve noticed several common patterns when it comes to denied claims. The truth is that many healthcare companies experience the same kind of denial codes as others.
Thus, we can point out specific common denial codes and explain how to spot their errors BEFORE sending a claim to the clearinghouse and/or payer.
PR 272 is one such common denial code. In today's blog we are going to discuss the denial code PR 272, what causes it, and the best way to mitigate it.
Let’s dive into it!
Table of Contents
What is a Denial Code?
Now, before I start explaining what exactly denial code PR 272 is. It’s important for you to understand what a denial code is.
Your billing department will receive a denial code if there’s an error in the claim. I alluded to this in the introduction of this blog.
I hate to tell you this, but denial codes can occur due to a myriad of different reasons. Before you start to panic, there are ways to help narrow down the reasons for the denial code.
But first, there are two different categories of denial codes. The most common denial code category is “CO”. The “CO” stands for “contractually obligated”. In other words, the insurance provider or billing department must cover the patient's bill. It’s important to note that the patient isn’t normally responsible for the entirety of the bill, just what the contract says it’ll cover.
The other denial code category is “PR”. The “PR” means that the bill is now the patient's responsibility. This category of denial can be a nightmare for billing departments to navigate. It usually means a lengthy collection process that awaits.
What is Denial Code PR 272?
Now that you have a better understanding of what a denial code is and the two main categories that could fall into, let's dissect denial code PR 272.
If your billing department receives this denial code, do not worry. It’s not the most difficult denial code to resolve.
Denial code PR 272 means that the service provided isn’t covered under the patient's insurance policy. This can be due to the physician’s office not reaching the correct guidelines for coverage.
Since there is a service and coverage mismatch, the denial code changes to a PR denial code. And, as I just described in the last section, the PR category means that the balance of this bill now falls entirely on the patient.
From a denial corrections perspective, I mentioned that this denial code isn’t very difficult to resolve.
However, I did also mention that the PR category of denials leads to a long collection process. This is still true. The current denied claims that contain this error that your practice has on its worklist today are going to take a while to receive complete payment.
But, by implementing the processes I discuss further along in this blog…you will be able to slow down the number of denials that you receive in the future that contain this code.
What Causes Denial Code PR 272?
Now that you know what denial code PR 272 is, let’s discuss the most common causes of this denial code.
To reiterate, PR 272 occurs when the coverage guidelines are not met during the physician visit.
This denial code can be easy to avoid by understanding the root causes of it.
Cause 1: Coverage Guidelines Not Met
The biggest reason for this denial code occurs when the patient's coverage isn’t met. In most cases, this means that there were limitations to their policy.
But, it can also be because of the policy requiring certain steps to happen before they approve a claim.
Cause 2: Incorrect Patient Information
While the patient is being checked in at the receptionist’s desk, information gathering and document needs to be as accurate as possible.
If there is an error in the denoted insurance plan, the physician's office may think that the treatment provided to the patient has coverage when it doesn’t.
If the patient information is incorrect on the claim that’s sent, it will lead to a different denial code altogether.
Cause 3: Prior Authorization
When a patient requires a special procedure, it may require something called prior authorization.
Now you may be wondering what that is, well, it’s exactly what it sounds like. The Insurance company needs to authorize any procedure that is outside of their set guidelines.
If you do not receive the prior authorization it can cause the billing department to receive this denial code.
Cause 4: Inaccurate Coding
While this code primarily points to uncovered coverage guidelines, errors in coding can indirectly lead to this denial.
If the coding inaccurately represents the service provided, the insurance company may see a mismatch between the claim and the patient’s coverage, resulting in a denial.
Cause 5: Lack of Proper Documentation
While the doctor meets with their patients they’re usually also documenting everything occurring. It’s vital to have everything that happened in the appointment documented.
Doctors aren’t always the best at taking notes. Thus, sometimes things get lost in translation. Once the billing department reviews the notes, it’s not uncommon for errors to occur at this stage.
To avoid PR 272 denials, having a concrete and detailed documentation process is a must.
Otherwise, the billing department might inadvertently send inaccurate claim data to insurance simply because of a lack of detail.
Cause 6: Delays in Claim Submission
Timely claim submission is critical in the medical billing process. If a claim gets filed late, it increases the likelihood of receiving denial code PR 272. This typically occurs when the patient’s insurance policy has expired, changed, or no longer provides coverage for the submitted service.
Delays can happen for various reasons—whether it’s a backlog in the billing department or missing information that holds up the submission process. Regardless of the cause, late claim submissions can severely impact your practice's revenue cycle.
How to Mitigate Denial Code PR 272
Now that you understand the common causes of denial code PR 272, let’s discuss ways your billing department can mitigate it. Understanding and implementing these strategies can help reduce the risk of receiving this common denial code.
Mitigation 1: Proper Documentation
I hinted at this a little earlier but no matter what you’re doing with a patient, it’s important to document everything.
Yes everything, the time date and exactly what happened during the interaction. This documentation can help when it comes to appealing the claim.
Mitigation 2: Proper Staff Training
Training your staff properly is often overlooked because it seems so simple.
However, it is a large reason why claims get denied. This is because of how often new CPT codes get added, or the current ones get changed or removed completely. This is why it’s vital to keep your staff up to date on the claims.
Mitigation 3: Hire a Clearinghouse
One of the best ways to avoid denial code PR 272 is by working with an experienced clearinghouse. A clearinghouse acts as a bridge between your billing department and insurance companies. One with years of experience knows the common reasons for claim denials, including PR 272, and can help your practice avoid these issues.
They check claims for mistakes and fix them before sending the claims to the insurance company. This process helps ensure that claims are accurate and reduces the chance of denials.
Mitigation 4: Stay Up To Date With Payers Policy
Keeping up with insurance companies' policies is one of the simplest ways to reduce denial codes like PR 272. Insurance providers frequently update their guidelines, and if your billing team isn’t aware of the changes, it can lead to costly claim denials.
For example, a covered service last year might now require prior authorization or fall under new coverage limits. If your team isn’t checking for updates, claims could get denied simply because of outdated information.
Addressing Denial Code PR 272
Even if you take all of the preventative measures, you can still receive denial code PR 272. I know it's frustrating to hear, but it is a hard truth you need to accept early on.
As I alluded to in the introduction to this blog post, it’s simply impossible to completely avoid all of your claim denials.
So, what should your billing department do if you receive denial code PR 272?
Solution 1: Check for Billing Errors
The first thing you should do if you receive this denial code is review the bill for errors.
If your company does not use a clearinghouse tiny mistakes could have slipped through, leading to a denial.
It’s very important to ensure all of the information in the claim is correct, if the policy information is correct, it can trigger denial code PR 272.
Solution 2: Review Patients Policy
It’s important that if you do get this denial code look at the patient's insurance policy.
The insurance company can make mistakes, and it’s important to catch them before the patient pays the bill.
By reviewing the policy it can ensure that the denial code is valid and did not occur out of error.
Solution 3: Resubmit or Appeal the Claim
If your department has documentation that the error in the claim was incorrect, your billing department can file an appeal.
When filing the appeal, you need to have all of the proper documentation that proves that the insurance company made an error.
If there is an error in the claim, once your billing department fixes the error, it’s vital they resubmit it as soon as possible. It’s important to resubmit the claim as soon as possible to help get your payment faster.
Solution 4: Discuss Payment Options with the Patient
Since this denial code makes the entirety of the bill the patient's responsibility, it is important to inform the patient of their options.
Payment Plans: If the patient can not afford to pay the entirety of the bill at once, offering them a payment plan can help ease their stress.
Financial Assistance Programs: There are government programs that can help assist with the payment of the bill.
Conclusion
Denial code PR 272, is an intimidating denial code for your office to receive. Your billing department must know what they can do to mitigate denial code PR 272.
Having proper documentation, as well as staying up with insurers’ policies as they change frequently. Hiring a clearinghouse can also help review claims before the insurance company reviews them, reducing errors altogether.
It is important to address these issues before they occur to help streamline your payment process. Even though you can not completely avoid denial codes, it is important to know what you can do to help reduce the denials you receive.
