As a physical therapy biller or practice owner, you may have come across the PR-39 denial code in your medical billing process. This denial code indicates that an authorization or pre-certification was requested for a specific procedure but was ultimately denied by the insurance company. It is crucial to understand the implications of this denial code and how to avoid it to ensure a smooth revenue cycle management process. In this comprehensive guide, we will delve into the details of PR-39 denial, providing insights, strategies, and best practices for physical therapy billing.
What is PR-39 Denial?
PR-39 denial code indicates that a service or procedure has been denied due to a problem with preauthorization or pre-certification. When a physical therapy practice requests authorization from an insurance company before providing a specific service, they must receive approval for that service to ensure reimbursement. However, in cases where authorization is denied, the insurance company will issue a PR-39 denial code. Claim Adjustment Reason 39: Services denied at the time authorization/pre-certification was requested.
However, the prior authorization process isn't perfect. In fact, a 2018 report by the Office of Inspector General found that 13% of prior authorization denials by Medicare Advantage plans were for benefits that should have been covered
Differentiating PR-39 and CO-197 Denial Codes
It is important to differentiate between PR-39 and CO-197 denial codes. While both codes are related to authorization problems, they are distinct. PR-39 denial code indicates that authorization or pre-certification was requested but was denied by the insurance company. On the other hand, CO-197 denial code suggests that the authorization was incorrect, absent, or incomplete. Understanding the difference between these codes allows for appropriate action and targeted strategies to avoid future denials.
Authorizations and Referrals in Physical Therapy Billing
Authorization and referral processes play a crucial role in physical therapy billing. Let's explore the significance of these processes in ensuring proper reimbursement and maintaining a healthy revenue cycle.
Research by the Kaiser Family Foundation found that 99% of Medicare Advantage enrollees are in a plan that requires prior authorization for some services.
The Role of Prior Authorization in Physical Therapy
Prior authorization is a process where healthcare providers seek approval from insurance companies before providing specific services or procedures. In physical therapy, insurance providers may require prior authorization for general treatment sessions or only for specialized treatments and services. By obtaining prior authorization, physical therapy practices can ensure that the services provided will be covered by the patient's insurance, reducing the risk of denials and payment delays.
The Significance of Referrals in Physical Therapy Billing
Referrals are written recommendations from primary care physicians or referring specialists for patients to seek specialized care, including physical therapy. Referrals not only facilitate the coordination of patient care but also play a vital role in reimbursement. In order to obtain prior or preauthorization, insurance companies often require a referral to be in place for physical therapy services to be covered. Failing to obtain a proper referral can result in claim denials and potential financial losses.
Common Reasons for PR-39 Denial
Ultimately, the reasons for PR-39 are reasons why a preauthorization might be denied. Let's explore the top three reasons a prior authorization would be denied, resulting in a PR-39 denial.
1. Lack of Medical Necessity
Insurance companies evaluate the medical necessity of services or procedures before approving authorization requests. If the requested service is not deemed medically necessary or is not supported by appropriate clinical documentation, the insurance company may deny the authorization. It is crucial for physical therapy practices to clearly demonstrate the medical necessity of the requested service through comprehensive documentation.
2. Inadequate Documentation
One of the primary reasons for PR-39 denials is inadequate documentation. Insurance companies require detailed and accurate documentation to support the medical necessity of the requested service or procedure. Incomplete or insufficient documentation can lead to denials, as it fails to provide the necessary information to justify the need for authorization.
3. Lack of Referral
Oftentimes authorizations can be denied because the insurance company requires a new referral. Failing to obtain a proper referral can lead to denials and potential financial losses. Even in states with direct access, depending on the insurance, you may still be required to get a referral after the initial eval.
4. Limits of Coverage
In many cases, the patient's insurance plan simply does not cover physical therapy services or certain PT treatments. In this situation, the only option is for the patient to contact their insurance provider to understand and potentially change their coverage.
Strategies to Prevent PR-39 Denials
Preventing PR-39 denials requires a proactive approach and the implementation of effective strategies.
1. Thorough and Defensible Documentation
Comprehensive and accurate documentation is critical in preventing PR-39 denials. Physical therapy practices should maintain detailed records of patient encounters, treatment plans, progress notes, and any other relevant documentation. Defensible documentation that demonstrates medical necessity will be the therapist's best resource when requesting authorization.
2. Utilizing Technology Solutions for Authorization Management
According to a survey by the American Medical Association, a significant 86% of physicians consider the administrative burdens of prior authorization to be high or extremely high. Leveraging technology solutions can significantly streamline the authorization management process and minimize the risk of denials. Practice management systems and electronic authorization tools can automate the authorization workflow, ensuring accurate and timely submissions. These tools can also provide alerts and reminders for upcoming expirations or limitations, allowing practices to proactively seek re-authorization when necessary.
Conclusion
Ensuring successful prior authorization for physical therapy services requires careful attention to various factors. Lack of medical necessity, lack of referral, and limits of coverage are common challenges that can lead to denials. To prevent PR-39 denials, physical therapy practices should adopt proactive strategies such as technology-assisted authorization management.