Medical billing is an essential but complex part of running a healthcare facility. For physicians managing their own billing, medical office administrators and financial managers in Ontario hospitals and clinics, accurate billing is vital to reduce administrative workload, maintain cash flow and ensure compliance with government policies.
Unfortunately, billing errors are common and end with claim rejections that waste time, delay payments and put an unnecessary strain on resources. According to the Journal of AHIMA, unresolved claims denials represent an average annual loss of $5 million for hospitals or up to five per cent of net patient revenue.
This blog explores the most frequent medical billing errors in Ontario hospitals, along with actionable solutions. We’ll also discuss how billing expertise and technology can improve billing processes, helping to ensure greater accuracy and efficiency.
Medical billing involves navigating intricate codes, reporting rules and compliance requirements. Here are four of the most common rejection codes in Ontario and some helpful billing accuracy tips.
Error 1: AT3 Rejections (No Patient/Physician Relationship Established)
An AT3 rejection occurs when a patient/physician relationship has not been established. According to the billing rules, most consultations require that the patient has been seen in person by the billing physician before a claim can be processed.
Solution:
- Verify patient relationships: Before submitting a claim, confirm that patients have had an in-person visit with the physician. Use an Electronic Medical Record (EMR) system to track and confirm these interactions.
- Schedule in-person visits promptly: If a telemedicine appointment occurs before an in-person visit, ensure the follow-up is scheduled promptly to avoid delays in billing eligibility.
- Educate staff: Train intake team on the specific billing requirements to prevent future AT3 rejections.
Today’s EMRs provide excellent platforms for managing patient care. While some EMR solutions allow administrators to send claims directly to the provincial health ministry, they typically come with some limitations, which is why many healthcare organizations choose Dr.Bill to complement their EMR.
Error 2: EH2 Rejections (Incorrect Version Codes)
An EH2 rejection occurs when the patient’s health card version code is incorrect or outdated. Version codes are usually updated every five years, and an expired code will lead to rejection. Dr.Bill estimates that Ontario doctors face an average annual loss of approximately $10,000 due to incorrect or expired version codes.
Solution:
- Verify health card details: Implement a process to confirm the patient’s health card number and version code before each appointment.
- Use automated systems: Leverage EMR software that can integrate with provincial health registries to validate version codes.
- Follow up with patients: If an incorrect version code is identified, contact the patient immediately to obtain the updated information or to notify them to apply for a new health card.
Error 3: AC1 Rejections (Limit for Consultations Reached)
AC1 rejections occur when a claim is submitted for a consultation beyond the allowable limit within a specific timeframe for a single patient.
Solution:
- Track consultation limits: Use the EMR to monitor the number of consultations per patient and flag instances where the limit may be reached.
- Communicate with colleagues: If a patient has seen multiple specialists, coordinate with other physicians to ensure billing overlaps are avoided.
- Submit alternate billing codes: If further care is needed, explore whether alternate billing codes can be used to reflect the type of service provided, such as follow-up care or specialist consultations.
With the Comprehensive Plan, Dr.Bill’s expert billing agents automatically correct and resubmit rejected and refused claims on behalf of the clinic or hospital. The dollar value of all successful claims, along with the value and status of claims in progress are always available to be viewed.
Error 4: VJ7 or VJ8 Rejections (Stale-dated Claims)
Claims that are submitted after the allowable submission window will receive a VJ7 or VJ8 rejection. In accordance with the Ontario Health Insurance Act (HIA), all claims must be submitted with three months of the date of the service. Claims submitted after three months will be rejected to the Claims Error Report with error condition VJ7 – Stale dated claim.
Solution:
- Monitor deadlines: Set up reminders within the billing system to note any claims approaching the submission deadline.
- Batch submissions: Submit claims weekly to avoid accumulating overdue submissions.
- Appeal if necessary: If a claim becomes stale-dated due to extenuating circumstances, such as patient information delays, submit an appeal with supporting documentation.
Improving Billing Accuracy Utilizing Technology and Expertise
For practices, clinics and hospitals, claim denial rates are on the rise, with average denial rates reaching 10 per cent or more. According to a Medical Group Management Association (MGMA) poll, 69 per cent of survey respondents reported an increase in claim denials for their healthcare facility.
Thus managing medical billing errors effectively requires not just attention to detail but also the right technology, tools and expertise. Here are two strategies to streamline and enhance the billing process to make it more accurate and efficient.
Hire an Outside Expert
Bringing in an external billing expert or consultant can provide a fresh perspective and identify gaps in the current billing processes. Industry experts who specialize in Ontario medical billing issues stay up to date with provincial billing codes and policy changes. They can also audit past claims, recover missing revenue, appeal previous rejections and prevent future claims rejections. In addition to engaging a medical billing consultant for periodic reviews, it’s a good idea to designate another set of eyes within the clinic or hospital to oversee and claims submissions.
Employ a Group Billing Software Solution
Be sure to evaluate billing software solutions and choose one that aligns with the clinic’s needs. Prioritize systems that offer real-time claim tracking, bank-level security and detailed reporting features. Medical billing software designed for Canadian healthcare providers, such as Dr.Bill, simplify and optimize the billing process.
Dr.Bill is designed to make a difference in billing accuracy, efficiency and bottom line results for Canadian healthcare facilities. Dr.Bill’s Group Solutions are currently available to reduce claims denials improve revenue and ensure compliance for hospital departments and clinics in Ontario, British Columbia and Alberta.
How it helps:
- Automatically audits claims before submission, flagging potential errors such as incorrect codes or missing information
- Tracks submission deadlines and helps manage rejections efficiently
- Integrates seamlessly with EMRs, improving accuracy and reducing manual work
Final Thoughts
Billing errors are a common but manageable challenge for Ontario hospitals and clinics. By understanding the most frequent issues, from AT3 and EH2 rejections to stale-dated claims, physicians managing their own clinics, financial managers and medical office administrators can proactively address these problems and reduce rejections.
Leveraging billing software programs and external expertise can further enhance billing accuracy, ensuring a smoother revenue cycle, consistent cash flow and greater financial stability. Also, adopting best practices for claim submissions and integrating tools like Dr.Bill can save time, improve efficiency and minimize the stress associated with billing issues.
This article offers general information only and is not intended as legal, financial or other professional advice. A professional advisor should be consulted regarding your specific situation. While information presented is believed to be factual and current, its accuracy is not guaranteed and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the author(s) as of the date of publication and are subject to change. No endorsement of any third parties or their advice, opinions, information, products or services is expressly given or implied by RBC Ventures Inc. or its affiliates.
