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If you're experiencing higher than average claim denial rates for mental or behavioral health, then it's time to look into how carve outs might be affecting your bottom line. Often, an insurance company will outsource mental and behavioral health benefits to a third party, essentially “carving out” or assigning those benefits to another insurance carrier.
Carve outs often result in claim when because the claim gets submitted to the wrong company. This is because the carve out is usually not listed on the insurance card. Then, when the biller submits the claim to the primary insurance carrier—it is denied.
Resolving a claim denial due to an insurance carve out can be difficult. What typically happens is when you call to follow-up on the claim denial, you're told that it is denied because they don't cover those services. They fail to mention that the reason they do not cover the services is because the behavioral health benefit is assigned to a third party.
You may review the claim, verifying that the authorization is in place, that there
are no errors on the claim, or typos in the policy number—only to come up with nothing. After due diligence, and usually a re-verification of benefits, you find out that the claim was submitted to the wrong insurance company.
Patients don't always know that some of their benefits are covered by an insurer other than their primary and if the biller does not correct out the insurance claim, patients can be held liable for the entire bill.
Carve outs are a headache for claims managers around the country. They're difficult to identify and require extra attention. The best way to save yourself time and money is to ask if there is a carve out every time you verify a patient's behavioral or mental health benefits. You should ask the following questions:
Does this policy have a behavioral / mental health carve out?
Who is the benefit carved out to? And is there a separate ID number?
Phone number for prior-authorization?
Where should claims be submitted?
Always relay this information to the biller once you’ve obtained it.
If your practice or facility is experiencing excessive claim denials, we can help. You can also download our behavioral health guide to accurate claims processing below.
Happy claims management!