How Critical Thinking Skills Help Avoid Denials

How Critical Thinking Skills Help Avoid Denials

Denials have been on my mind for the last few weeks – specifically, how do we prevent them?

According to the Public Broadcasting Service (PBS), 48.3 million claims were denied in 2021, which was 16.6 percent of all claims. If you use the standard of $25 per claim as the benchmark, then the total cost for reworking the denials was over $1.2 billion.

As coders, how can we affect claim denials? My thought is…we need to use critical thinking skills.

What is critical thinking? According to, critical thinking includes five steps: formulate your question, gather your information, apply the information, consider the implications, and explore other points of view.

In applying this process to coding, my initial question is this: what is wrong with this patient, and how many resources were used to treat them? The ICD-10-CM/PCS and/or CPT codes must paint the picture of severity of illness and resource consumption for each patient.

To gather the information, I will read and understand the clinical information in the chart. When I read through charts, I jot down the diagnoses and procedures that were documented.

Now, to apply the information, the codes are assigned. Are there any information gaps to assigning the codes? Is there conflicting information regarding the diagnoses or procedures?

The next step in the process is to consider the implications. Does the conflicting information impact the MS-DRG or APR-DRG assignment? Does missing information impact the code assignment? Would additional information provide a more specific code?

The last step is exploring the options. What is the likelihood that this case will be denied? One complication or comorbidity (CC) or major CC (MCC) increases the likelihood of denial. Conflicting or missing information also increases the denial rate.

Let’s walk through an example of following these critical thinking points:

A patient presents to the emergency department after a fall. He has some confusion as well as a hip fracture, which is repaired later in the stay. The neurological assessment is alert on most days, but a few days he is documented as confused. The laboratory values show that the patient is dehydrated. The provider documents in several progress notes that the 79-year-old patient has dementia and toxic metabolic encephalopathy. The discharge summary does not include the diagnosis of toxic metabolic encephalopathy.

In applying our critical thinking model, I know that this patient had a hip fracture and surgery. He also had some confusion. As I read through the chart, I noticed that the documentation is conflicting regarding the patient’s confusion. As I assign the codes, I have an issue with toxic metabolic encephalopathy, because it is not carried through discharge. This case has a high likelihood of being denied, because it is the only MCC on the chart and it increases reimbursement. It requires a physician query to close the loose ends.

As coders, we use critical thinking skills daily, and on every chart. By using this skill, we avoid reimbursement loss, delay, and the extra work required to respond to a denial. In some cases, the extra time spent resolving conflicting information will avoid the denial.

Make sure to use your critical thinking skills when coding charts!

Programming note: Listen to Laurie Johnson’s live coding reports every Tuesday on Talk Ten Tuesdays, 10 a.m., with Chuck Buck and Dr. Erica Remer.


Laurie M. Johnson, MS, RHIA, FAHIMA, AHIMA Approved ICD-10-CM/PCS Trainer

Laurie Johnson is currently a senior healthcare consultant for Revenue Cycle Solutions, based in Pittsburgh, Pa. Laurie is an AHIMA-approved ICD-10-CM/PCS trainer. She has more than 35 years of experience in health information management and specializes in coding and related functions. She has been a featured speaker in over 40 conferences. Laurie is a member of the ICD10monitor editorial board and is a permanent panelist on Talk Ten Tuesdays

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