Top 10 Reasons Why Your VA Hospital Claims Are Rejected

VA claims require equal parts expertise, patience, and compassion. Knowing what it takes to meet the exact standards of the respective VA/DOD payer requires extensive background knowledge and experience, and even if done correctly, you will still face constant issues related to denials, underpayments, and an inventory of aged accounts. Simply put, if it’s not documented and coordinated properly, then it didn’t happen per the prescribed ruleset for processing, and you’re stuck with VA claim rejections and denials.

Why are VA claims rejected or denied? Although some use these terms interchangeably, they mean completely different things. Understanding the differences is essential to ensuring the reimbursement process for your VA claims is handled correctly. 

What Are VA Claim Denials?

Denied claims come directly from the payer. A denial occurs due to a payer determining they are not going to pay the claim. These denials can happen for several reasons including a need for authorization, the claim was filed too late, the payer didn’t feel the service was medically necessary based on the documentation provided, and more. 

Once a claim has been denied, the remedy is complex. Denied claims go through an appeals process in which a provider asks the payer to review their decision by providing additional information.

What Are VA Claim Rejections?

Claims that have been submitted to a clearinghouse but do not meet specific data requirements or the basic format required will be rejected. Typos, misspellings, terminated patient policy or incorrect coding are some of the reasons that a claim can be rejected. Rejected claims are not yet submitted to the payer, and thus do not make it to the adjudication system. Since the claim hasn’t been submitted to the payer yet, it can be resubmitted once all errors are corrected. Be mindful, however, that there is still a timeline as to when a claim needs to be filed, so delaying the resubmission of a claim can be costly.

Why Are VA Claims Rejected?

These are the top ten reasons — from most common to least — why a VA hospital claim is rejected, according to the Department of Veterans Affairs.

1. Missing/incomplete/invalid Insured ID: This rejection occurs when this field, which requires a 17 alpha-numeric internal control (ICN) [format: 10 digits + “V” + 6 digits] or 9-digit social security number (SSN) with no special characters, is missing or incomplete.

2. The outpatient claim has a missing “Admission Type” code: Admission Type code describes the primary reason for the urgency and priority of care the patient requires.

3. Missing Admission Type when Admission Date is present: If there is an Admission Date on a claim, this means the patient is an inpatient. Therefore, the Admission Type field must be present to address the reason for admitting the patient.

4. Referring and Attending Physician NPI are equal: As of January 1, 2013, claims must include the NPI of the attending provider in the Attending Provider Name and Identifiers Fields on your claims. That NPI must not be your billing NPI or an organizational NPI; it must be an individual provider NPI.

5. Claim contains a missing/incomplete/invalid Billing Provider Address: This rejection occurs when there is an incorrect address, or missing address, for the provider location where the care took place.

6. Claim contains missing or invalid Patient Status: A Patient Status is a field on a claim that describes the patient’s discharge status. If this field is blank or includes an incorrect status code, the claim will be rejected.

7. Claim contains ICD9 Principal Dx code: ICD10 codes must be used for dates of service after 09/30/2015. ICD9 codes can no longer be used for the principal diagnosis code on a claim.

8. Claim contains invalid or missing “Patient Reason” diagnosis code: This rejection occurs when there is a missing or incorrect diagnosis code, or“Patient Reason DX” in box 70. This field must provide the reason for the Veteran seeing the provider and at least one official code from the American Medical Association (AMA) database on the form.

9. Missing Patient Account Number: A patient account number is a unique set of numbers assigned to an individual patient, for each unique episode of care. This unique identifier is a required field on every claim. If it doesn’t exist, the claim gets rejected.

10. Invalid Type of Bill code: This rejection occurs when the required diagnosis or procedural coding information on a claim is illogical, incorrect, or no longer in effect.

Resolving rejections can add months or even years to the process. Having “clean claims” upon initial submission is critical to getting paid quickly and accurately. Most healthcare organizations find that it ultimately takes a substantial investment in resources to master the nuances of VA claims. 

How to Avoid and Resolve VA Claim Rejections

Specialization and bringing an economy of scale to this problem absolutely pays off for CBO leaders considering bringing in an expert. Having a business partner who knows and understands the VA’s goals, tendencies, and motives only makes more sense.  

At EnableComp, we are currently seeing a 41% decrease in time to collect with an average increase of 25% – 40% in VA collections in 98 days or less. Our proprietary technology, E360 RCM™, is the most efficient provider-based comprehensive workflow engine in the marketplace.

As we continue to understand where the VA wants to go, we learn and understand their myriad of processes and procedures. Every additional claim makes our AI “smarter” and enhances our data-driven RPA leading to a real bottom-line impact for providers. With built-in reimbursement modeling, underpayment identification, and automated workflows, our software helps our team provide you with the highest yield and best-in-class outcomes in less time.

For more of the latest news, information, and case studies, be sure to check out our VA Claims Knowledge Center.