Bill Sample / December 10, 2018 / Kelley Mendez
Followup may take the form of a phone call to payer to discover a lost claim or to receive interpretation of denial message correction of earlier submitted data resubmission of the original claim consultation with the provider and medical notes or denial appeal. Both FPP and Denial rates are very important metrics often used for billing process improvement. The upside of FPP/Denial metric is that it is charge-invariant but its downside is that it hides the differences between process imperfections on the claim submission and claim payment sides. To identify patterns of problem CPT codes or payers FPP/Denial metric needs to be computed and compared across all pairs of payer-CPT code which is a standard feature for modern billing technologies.
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This lag time roughly averages across all payers making DAR an effective comparison metric between payers for individual provider but invalidating it across multiple providers. One obvious advantage of DAR metric is its independence of charges. The averaging feature of this metric eliminates sensitivity to specific day or CPT but also hides the behavior shape of the accounts receivable curve. First-Pass Pay (FPP Rate) and Denial Rate FPP is the percentage of claims paid in full the first time upon submission (subject to federal or state timely payment regulations: 15 days for electronic submission and 30 days - for paper). Denial rate is the complementary metric to FPP rate. It counts the percent of claims that require followup and therefore cost more to process.