Mastering Outpatient Professional Services Denials

By: Briauna Driggers, Mary Early Suhr, MBA, CPC, and Juan Arredondo 

Denials for outpatient professional services continue to challenge healthcare providers, with their complexity often leading to delayed reimbursements and financial losses. In the final installment of our denials webinar series, we explored some of the most common causes of these denials, including authorization issues, noncovered services, bundling claims, and diagnosis-driven errors. Here’s a glimpse into what we covered and how this valuable information can help your practice avoid costly mistakes. ​

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Key Outpatient Denial Triggers and How to Address Them

Authorization Pitfalls 
Authorization-related denials frequently arise from mismatches between Advanced Practice Providers (APPs) and supervising Medical Doctors (MDs) in the authorization request. For instance, if the wrong provider is authorized for a service, claims can be denied outright. Additionally, details such as location verification—even down to the suite level—can lead to rejection. We also highlighted the importance of ensuring that on-the-fly procedures, especially those bundled with evaluation and management (E/M) services, are adequately documented and authorized. 
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Noncovered Services 
Understanding what constitutes a “new” versus “established” patient according to payer policies is critical. Many denials occur when providers incorrectly classify patients or fail to align with CMS guidelines. For example, a patient who hasn’t received face-to-face services within three years is considered new, but overlooking this detail can lead to unnecessary denials.  It was also noted that patients who are initially seen by a group provider in the hospital are also considered established to the group. 

The Bundling Risk 
Bundling denials often stem from assumptions that higher-level authorizations automatically include lower-level services. For example, if you authorize a biopsy of the largest size and perform a biopsy of a smaller size, the smaller size is not automatically covered.  This misconception can result in rejected claims. Additionally, pre-planned payer bundling policies for procedures performed on the same day require close attention to avoid surprises. 

Modifiers and Their Role in Denials 
Modifiers can either save or sink a claim. In this session, we discussed specific modifiers, such as: 

• Modifier 25: For distinguishing separate, identifiable E/M services performed on the same day as minor procedures. 

• Modifier 24: For unrelated services during a surgical global period. 

• Modifier 58: Rare in outpatient settings but crucial for staged procedures following operative care. 

Proper use of modifiers like JZ and JW for drug wastage or QW for CLIA-waived lab services can prevent denials if aligned with payer-specific requirements. 

Diagnosis-Driven Challenges 
Denials linked to diagnosis coding often arise from unspecified or incorrect codes. Examples include missing laterality (e.g., right vs. left) or incorrect sequencing of primary and secondary diagnoses. Screening services, aftercare, and family/personal history codes must also comply with payer-specific rules to avoid pitfalls. ​

Don't Miss Out

The full recording of this webinar is packed with essential details and expert advice that could transform how you manage outpatient denials. Download the recording now to access these insights and ensure your practice is prepared to address denial trends effectively. 

Struggling with inpatient denials? Check out part two of this series.