AI Revolutionizes Healthcare Revenue Cycles: Cutting claim Denials and Staff Burnout
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Healthcare providers are facing a growing crisis of claim denials, draining revenue and overwhelming staff. But a new wave of artificial intelligence (AI) solutions promises to break this cycle by preventing errors, prioritizing appeals, and providing data-driven insights for long-term enhancement, according to industry leaders.
The mounting Cost of Claim Denials
For many revenue cycle teams, claim denials have become an unavoidable – and painful – cost of doing business. This burden is often avoidable, with staff frequently recognizing that accurate upfront information could have prevented the claim from being rejected in the frist place. according to one industry official, preventing denials hinges on effective data management. even minor errors in patient registration, eligibility, or authorizations can trigger denials and costly rework.
Recent data underscores the severity of the problem. A survey by Experian Health revealed that 30% of claims are initially denied, and the average cost to rework a denied claim is $25. This translates to a significant financial strain on healthcare organizations.
Fortunately, AI is emerging as a powerful tool to address these challenges. AI algorithms can analyse data in real-time, identifying inconsistencies with greater speed and accuracy than manual processes. “By leveraging tools with AI, providers can get ahead of the mistakes,” one analyst noted. “These solutions can review claims data in real time and flag inconsistencies and missing or inaccurate data and ultimately, predict which claims are most likely to be denied before they are submitted.”
Experian Health’s Patient Access Curator™ (PAC) exemplifies this approach, consolidating eligibility verification, insurance revelation, and demographic data validation into a single platform. This streamlined process minimizes errors and frees up staff to focus on complex cases requiring human judgment.
Optimizing Resubmissions and Alleviating Burnout
Despite repeated appeals, hospitals and health systems only successfully overturned 54.3% of denied claims in 2022, resulting in nearly $20 billion in losses. This highlights a critical inefficiency: many teams process denials in order, nonetheless of their likelihood of success.
AI offers a solution by prioritizing resubmissions based on the probability of reimbursement. Experian Health’s AI Advantage utilizes predictive analytics to identify high-risk claims before submission, routing them for correction. It also prioritizes existing denials, ensuring staff focus on claims with the highest potential for recovery. This approach not only improves ROI but also reduces administrative burdens and combats staff burnout. “By prioritizing the claims that are worth the time and effort instead of treating every denied claim as equal, health organizations can produce the best ROI for the team’s efforts,” one industry leader explained.
Long-Term Denial Reduction Through Data Insights
While AI adoption in revenue cycle management is growing – with 63% of providers having introduced AI in some capacity – many are initially using it for lower-risk tasks.Though, leveraging AI for data analysis can provide significant value without requiring immediate, full-scale implementation.
AI-powered analytics can identify the root causes of denials, pinpointing recurring issues related to registration, authorization, documentation, or payer-specific requirements. This visibility empowers leaders to implement targeted process improvements. “Without understanding the cause of denied claims, it’s hard to prevent them,” one official stated. “AI-powered analytics takes away the guesswork.”
A Phased Approach to AI Adoption
Experian Health’s research indicates that 69% of providers utilizing AI have already seen a reduction in denials. However, overall adoption remains relatively low. The key, according to industry experts, is to start small.
“Deploying an AI pilot in a specific area, such as patient registration or resubmissions, allows organizations to see results and develop confidence in the investment,” one source noted. With the support of a knowledgeable vendor, teams can determine how AI best integrates into their workflows and demonstrate its value before expanding its use.
For healthcare providers facing increasing denials and staffing shortages, these three AI-driven strategies offer a path toward more efficient claims management, reduced rework, and predictable revenue cycle performance.
Learn more about how Experian Health’s AI-powered solutions, like Patient Access Curator and AI Advantage, can help providers reduce healthcare claim denials.
