Certified Revenue Cycle Representative (CRCR) Practice Exam

Which of the following is a common reason insurance claims are denied?

1. Incorrect coding or billing errors

2. Insufficient medical documentation

3. Non-compliance with patient follow-up

4. Failure to process payments on time

The correct answer is: Incorrect coding or billing errors

Incorrect coding or billing errors are indeed a common reason for insurance claims being denied. Proper coding is crucial in the revenue cycle process, as it directly impacts the ability to receive timely and appropriate reimbursement from payers. When claims are submitted with errors in coding, such as using an incorrect procedure code, diagnosis code, or modifiers, it can prevent the claim from being processed correctly. This results in the claim being denied, which can delay payment and add additional administrative work to correct the errors and resubmit the claim. The other options, while they can contribute to claim denials, are not as universally prevalent as coding and billing errors. Insufficient medical documentation can lead to denials, but it typically arises in specific situations where the insurer requires more information to justify the services billed. Non-compliance with patient follow-up is more related to patient management and continuity of care rather than direct billing issues. Lastly, failure to process payments on time pertains more to the revenue cycle's payment collection aspect, and while it can indeed complicate financial matters, it does not directly relate to the initial claims submission and denial process in the same way as coding errors do.