When it comes to describing an insurance claim status, many people use the term “rejection” and “denial” interchangeably. However, a rejected claim is very different from a denied claim. Knowing the difference between the terminologies is important as there are different ways to fix a denied and rejected claim. Today, we’ll go through a quick tip and take a closer look at the differences between the two and how they are defined.
Difference between Electronic Claim Filing Denial and Rejection
According to The Centers for Medicare & Medicaid Services (CMS), claims that do not meet the basic format or data requirements are rejected. This means that these claims do not make it to the payer, and are not considered as received, and therefore will not be processed. As a result, rejected claims need to be fixed and resubmitted.
On the other hand, denied claims are claims that have been received by the payer, but did not result in a reimbursement by the payer. Denied claims cannot be resubmitted since a payment determination has already been made. Instead, denied claims are appealed based on payer-requested modifications, additional documentation, etc.
The reason for the denial will appear in your ERA (Electronic Remittance Advice) if you use electronic claim filing or in your EOB (Explanation of Benefits) if you run a paper practice.
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