Weighing Privilege for Internal Coding Reviews
It’s virtually axiomatic that if you’re performing a review of your coding, the review should be done under attorney-client privilege. I have said this before on Monitor Mondays and written about it here. But increasingly, I believe that I was wrong, and most coding reviews should not be done under privilege. Let me explain why.  

Under the 60-day rule, you must report and return an overpayment within 60 days of its identification. Consider the implications of this in the context of a coding review. If you find a problem, you are going to have to disclose it to the government, whether that review is done under privilege or not. The main reason people think of using a privilege is so you don’t have to disclose the bad things you uncover. But since you have to return the overpayment and describe why it happened when there is an overpayment, the privilege isn’t going to have much of an impact. 

There is very little upside to the privilege. 

Next, imagine you perform a review and find that everything is good and there is nothing to disclose to the government – but then an employee raises concerns about the topic you’ve reviewed. In fact, let’s say that they have gone to the government and said that they raised the complaint to you, but you didn’t take them seriously. 

When the government contacts you, you will want to share your internal review and say “we did take the complaint seriously, and we looked, and we think it is fine!” You will want to justify your decision not to refund the money. But if the review was done under privilege, you’re going to need to waive attorney-client privilege to share the report. That’s possible, but it comes with complications. The scope of a privilege waiver can be quite complicated. In theory, one can waive privilege with respect to topic A while maintaining privilege with respect to topic B – but in practice, things get materially more complex.  

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Denials Management in 2025: Proactive Strategies Beyond Appeals
Denials have long been a pain point in healthcare revenue cycles, but in 2025, they have reached new levels of financial and operational impact. Recent studies show denial rates averaging 11.8 percent of all claims, with some providers reporting as high as 20 percent of claims initially denied.

Commercial payers in particular have grown more aggressive with their algorithms and audit triggers, which now extend beyond technical errors to clinical validation and medical necessity challenges. The financial impact is staggering, with billions of dollars tied up in appeals, write-offs, and delayed payments.

The Cost of Reactive Appeals
Historically, organizations relied heavily on appealing denials after the fact. But the costs are staggering. In 2022, the healthcare industry spent nearly $19.7 billion on appeals, and denial write-offs accounted for almost 3 percent of claims.

Appeals require specialized staff, extensive documentation, and months of follow-up. Even when successful, they represent lost time and resources.

Worse still, reactive appeal strategies fail to address the root causes that triggered the denials in the first place, creating a cycle of repeat denials. For many organizations, appealing denials has become an exercise in futility that consumes more resources than it saves.

Denials in the Current Landscape
In 2025, denial drivers are more complex than ever. Payers are using artificial intelligence (AI) and predictive modeling to identify patterns they consider high-risk. Claims with certain diagnosis clusters, unspecified codes, or unusual utilization patterns may be flagged before payment is even issued. Medicare Advantage (MA) plans, Patient Protection and Affordable Care Act (PPACA) exchanges, and commercial insurers are all leveraging advanced technologies to catch errors or perceived errors upfront. Clinical validation denials have grown in frequency, especially for services related to conditions like sepsis, acute kidney injury, encephalopathy, and malnutrition. Providers are increasingly tasked not just with coding accurately, but with ensuring that documentation proves clinical support. This shift requires clinical documentation integrity (CDI) and health information management (HIM) professionals to work more closely than ever with clinicians to ensure defensible documentation.

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More Prior Authorization? Say It Ain’t So – and More
As I am sure you all recall, a month ago, RACmonitor eNews broke the story of the new Aetna policy that will pay inpatient admissions at the observation rate if MCG inpatient criteria are not met.

Now, I wish I could report that Aetna has rescinded the change, but that has not happened yet. But I can tell you the uproar is loud and sustained. I know many of you have taken action, and we are also seeing state and federal organizations acting to stop the implementation. The effective date is Nov. 15, so there is still time for Aetna to back off.

And of course, Cigna has jumped on the bandwagon with a policy to automatically downgrade physician claims for high-level visits without even reviewing the medical record. Now, that is probably even more egregious than Aetna’s plan, as the visit level is determined by medical decision-making that cannot possibly be determined without reviewing the actual physician notes. But violating rules has never stopped a payor before…

Moving on, I occasionally get questions from case managers who question the legality or morality of new policies that are being implemented at their institution. And I am always happy to provide them with my perspective. Well, one recent one made my jaw drop. This hospital’s leadership developed their own notice of non-coverage and financial liability form, and they instructed their staff to give it out to any patient staying in the hospital who is stable.

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New Research Reveals How NSA is Affecting Providers, Consumers
As Congress again turns its focus to budget concerns, healthcare might be on the backburner for a while. However, two new studies examining the No Surprises Act (NSA) published in the last couple weeks showed the financial impact the law has had on the healthcare system – from consumers to providers to plans.

First up is a study from Harvard University and Mass General that found “significant decreases” in out-of-pocket spending for adults in states that enacted new protections under the NSA. Researchers found that the NSA prevented more than 10,000 surprise bills during just the first three quarters of 2023, and that consumer complaints about surprise bills dropped off notably as well.

This resulted in an estimated $567 reduction in out-of-pocket spending for Americans, which was a greater impact than even the Medicaid expansion and the Inflation Reduction Act. The study did note, however, that premium spending was not impacted by NSA.

Experts had considered the possibility that the law’s independent dispute resolution (IDR) process could impact premiums and healthcare costs through the negotiation process. But the federal government has released data indicating that cases won by providers result in higher payments – and providers win about 85 percent of IDR cases, per the latest data.

Interestingly, the study also suggested that the NSA actually increased healthcare utilization, keeping healthcare costs stagnant, and did not have a particular impact on what it calls high-burden medical spending that leads to medical debt. Researchers suggested that addressing some of the gaps in the NSA, including coverage of ground ambulance services – which, as frequent listeners to Monitor Mondays have heard me talk about many times, were intentionally left out of the NSA – as well as expanding knowledge about the NSA protections to all Americans could be helpful.

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