Configuring Business Rules for Denial Management

With the implementation of ERA, it is necessary to create a set of business rules that will direct NextGen® Enterprise PM on how to handle adjudicated claims, particularly denials. These adjustments and denials are identified by the payers with HIPAA standard reason codes.

In NextGen® Enterprise PM, ERA adjustments are automatically posted for reason codes pre-fixed with CO (contractual obligation), OA (other adjustment) and PI (payer initiated). Adjustments are not taken for reason codes pre-fixed with PR (patient responsibility).

NextGen® Enterprise PM also moves the remaining balance to the next responsible payer automatically when an ERA transaction is posted; from COB1 to COB2 (if a secondary payer exists), from COB2 to COB3 (if a tertiary payer exists), and finally to patient responsibility.

In order to fully automate the ERA Posting process, certain selections must be made in the Reason Codes Library to ensure that only the appropriate reason codes are taking adjustments and that all remaining balances are correctly allocated.

Business rules need to be set for reason codes where an adjustment should not be automatically taken, and/or the balance should not move to the next responsible payer.

For example, if a payer returns a reason code of CO10 (The diagnosis is inconsistent with the patient's gender), business rules can be put into place to automatically skip the ERA adjustment and set the transaction detail status to “Appeal” so the balance does not move into the next responsible payer.