Average denials rate

More importantly – how much are you losing per month due to denials?

Categorized as Operations Tagged

According to MGMA, the average denial rate for most practices ranges from 5% to 10%. 

Imagine – even if you are a small practice of two providers, you probably see 50 patients per day. That’s about 1000 claims per month.

If you have a denial rate of even 8%, you are looking at 80 denials per month. 

Even at a charge of $100 per claim you are (potentially) losing $8,000 a month in denied charges.

On top of this, reworking claims typically costs $25/claim reworked. So, you are spending an average of $2,000/month to rework denied claims. You will never really recover all of the $8,000. Let’s say that you are recovering $7,000/- out of those $8,000 denied charges.

At the end of the month, you have lost $3,000 and have only recovered $7,000. 

In other words, you need a strong strategy to reduce denials as months progress.

Otherwise you will always be playing catch-up and will always be “busy” but not making enough.