Editorials by Jorie

Mastering Denial Management in Healthcare RCM

Welcome to the forefront of revenue cycle management (RCM) in healthcare, where the challenge of denied claims persists. In today's digital landscape, where financial precision is crucial, effective denial management is of utmost importance. Denials not only impede cash flow but also demand substantial administrative resources for resolution.

This guide will systematically navigate the complexities of claim denials, equipped with industry best practices and insights. As we dive into the realm of denial management, it's essential to note the transformative potential of AI-powered solutions, such as those offered by Jorie AI, in streamlining revenue cycle processes.

Understanding Denials

Before diving into strategies for mitigation, let's grasp the scope of the issue. The HFMA reports that healthcare providers lose 5% to 10% of their revenue from denied claims. This means that, on average, providers are not receiving payment for a portion of the services they have provided.

Denied claims are a significant financial challenge for healthcare organizations. This loss of revenue can impact the ability of providers to deliver quality care to their patients. Shockingly, up to 90% of denials are preventable and result from errors in claims submission or inadequate documentation.

The cost of reworking denied claims can be staggering, with some estimates suggesting it ranges from $25 to $118 per claim. These statistics underscore the urgency for healthcare organizations to fortify their denial management strategies.

Identifying Common Denial Reasons

To effectively combat denials, one must first understand their root causes. Common reasons for claim denials include incomplete patient information, coding errors, lack of medical necessity, and timely filing issues. For instance, coding errors alone account for a significant portion of denials, with approximately 37% attributed to incorrect coding. Moreover, payor-specific rules and regulations further compound the complexity of the denial landscape.

Step 1: Enhance Front-End Processes

The journey to reducing denials begins at the front end of the revenue cycle. Implementing robust front-end processes, such as eligibility verification and prior authorization checks, can significantly decrease denial rates. By ensuring accurate patient information and verifying insurance coverage upfront, providers can preemptively address potential denial triggers.

Step 2: Optimize Coding and Documentation

Coding inaccuracies are a leading cause of claim denials, emphasizing the importance of precise medical coding and documentation. Investing in coder education and leveraging technology solutions can streamline coding workflows and minimize errors. Additionally, comprehensive documentation that supports medical necessity is crucial for claim acceptance and subsequent reimbursement.

Step 3: Implement AI-Powered Solutions

Innovative technologies, such as artificial intelligence (AI), are revolutionizing denial management in healthcare RCM systems. AI-driven predictive analytics can identify patterns and trends in claims data, enabling proactive intervention to prevent denials before they occur. For instance, Jorie AI offers cutting-edge AI solutions tailored to optimize revenue cycle performance, including advanced denial prediction and prevention capabilities.

Step 4: Streamline Appeals and Follow-Up Processes

Despite meticulous efforts, denials may still occur. Therefore, establishing efficient appeals and follow-up processes is essential for reclaiming lost revenue. Automated workflows and intelligent prioritization algorithms can expedite the resolution of denied claims, minimizing revenue leakage and improving cash flow. Using a platform like Jorie AI can make it easier to manage these systems and keep track of denials more effectively.

Step 5: Monitor and Analyze Performance

Continuous monitoring and analysis of denial trends are critical for refining denial management strategies. By leveraging data analytics tools, healthcare organizations can identify recurring denial reasons, pinpoint areas for improvement, and measure the effectiveness of implemented interventions. This iterative approach ensures ongoing optimization of the revenue cycle.

Reduce your denials with Jorie AI


What are the most common reasons for claim denials in healthcare?

Answer: Claim denials in healthcare can occur due to various reasons, but some of the most common include incomplete patient information, coding errors, lack of medical necessity, and timely filing issues. Inaccurate or insufficient documentation, eligibility verification discrepancies, and payer-specific rules and regulations also contribute to denial rates.

How can healthcare organizations leverage technology to reduce claim denials?

Answer: Healthcare organizations can leverage technology, such as AI-powered solutions, to reduce claim denials effectively. Advanced analytics tools can analyze claims data to identify patterns and trends, enabling proactive intervention to prevent denials before they occur. Additionally, automated workflows and intelligent prioritization algorithms streamline appeals and follow-up processes, expediting resolution and minimizing revenue leakage.

What are the benefits of implementing a proactive denial management strategy?

Answer: Implementing a proactive denial management strategy offers several benefits for healthcare organizations. By identifying and addressing potential denial triggers upfront, organizations can prevent revenue loss, improve cash flow, and enhance overall financial performance.

Proactive denial management reduces time spent fixing denied claims. This allows staff to focus on more important tasks. It also helps them provide better care to patients.


In conclusion, mastering denial management is indispensable for optimizing revenue cycle performance in healthcare. Organizations can improve their financial health by being proactive and using best practices to reduce denials and increase cash flow. With the advent of AI-powered solutions like those offered by Jorie AI, healthcare providers have unprecedented opportunities to leverage data-driven insights and achieve sustainable revenue growth.

Take the first step toward unlocking your revenue potential—schedule a demo with Jorie AI today and embark on a transformative journey toward a more resilient revenue cycle.

Other blog posts