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Why Your Practice Should Monitor Allowable Mismatch

If you aren’t already tracking allowable mismatches in your practice, you should be.

Also known as a form of payer underpayment, allowable mismatch is when an insurance company pays a medical practice an amount lower than the rate agreed to under its contracted fee schedule.

The Impact of Allowable Mismatches on Your Practice’s Revenue

Did you know that insurers underpay providers by 7% to 11% on average, according to the Medical Group Management Association. Some reasons for these underpayments could include increasingly complex payer contracts, as well as slow and outdated legacy billing and coding systems. The bottom line is this – if you are not tracking allowable mismatches in your practice, you are not receiving all you are due contractually from your payers.

Under no circumstances should physicians accept underpayment for their services, but the challenge for many practices is identifying and tracking allowable mismatches. Without question, your EHR should be able to help, by tracking them and offering reports to help your practice monitor them. This is the most accurate way to identify, track, manage and recoup allowable mismatches.

Root-Cause Analysis: Identifying and Addressing the Issue

In this month’s guide, The Importance of Monitoring Allowable Mismatch, we delve into allowable mismatch prevention as well as root-cause analysis suggestions when it does in fact occur to your practice. As is the case with most revenue cycle management processes, it is less costly and efficient for your practice to process claims correctly the first time and prevent the need to reprocess them. Such activities take a lot of time and resources away from other more critical activities.

Allowable Mismatch

But nobody wants to leave hard-earned dollars on the table. So, in addition to prevention steps and root-cause analysis actions to help find the reason for the allowable mismatches, we also outline important steps to take once you do discover allowable mismatches in your accounts receivables.

While tracking down allowable mismatches is a labor-intensive and manual process, it is well worth the monthly discipline by your internal billing department or third-party billing service. In this month’s guide, we also outline best practices for formal appeal with the insurance company, which can ensure proper reimbursement and that future payments get processed correctly and in accordance with your contractual fee schedule. 

For example, if you as a provider are contracted for $100 for procedure X and only receive $80 from the insurance company, the $20 gap is the mismatch. Imagine if this is a procedure you do many times a day. Now multiply that revenue loss over the course of a month, and then a year.

Those dollars belong to your practice and are well worth chasing, rather than allowing those revenues to line some other company’s pockets.