Medical Necessity Denials in Emergency Departments

Unfortunately, emergency departments have increasingly become the main target of medical necessity denials by insurance providers. These audits are costly, time-consuming, and put patients at risk of receiving inadequate care.

When a patient visits the emergency department, the staff strives to provide the best possible care. This includes not only addressing the immediate medical need, but also ensuring that the patient is seen by the most appropriate provider and that all tests and treatments are medically necessary.

Appeals and denials can be financially devastating for EDs, which often operate on razor thin margins.

“Roughly 55% of an emergency physician’s time is spent providing uncompensated care.”

Centers for Medicare & Medicaid Services

Here’s what you need to know about medical necessity denials in ERs so that you can avoid them.

Medical Necessity Audit Overview

An insurance company (or CMS) denies payment for emergency room services previously rendered. This can be a frustrating and costly experience for both patients and providers.

Denials are often the result of a lack of communication between the ED doctor and the payer. For example, the ED doctor may fail to document the medical necessity of the care rendered.

What are medical necessity audits in EDs

Medical necessity denials in emergency departments occur when a payer denies reimbursement for emergency department (ED) services rendered, stating that the care was not medically necessary.

What causes medical necessity denials in Emergency Care

Appeals and Denials occur when a patient is seeking treatment for a condition that is not considered to be life-threatening. ER doctors are required to triage patients, and those who are not considered to be in immediate danger are typically seen last.

Another cause might be a patient seeking treatment for a condition that is not covered by their insurance or local coverage determinations. The American Hospital Association recently expressed their continued frustrations with “inappropriate and excessive denials for prior authorization and coverage of medically necessary services“.

If you are seeking treatment for a non-emergency condition, it is best to consult with your primary care doctor or visit an urgent care center.

How can EDs prevent medical necessity audits

Emergency departments should establish policies and procedures that prioritize medical record review, program integrity, insurance compliance, and documentation

  • Develop policies and procedures related to medical necessity. These policies should be designed to ensure that all patients presenting to the ED are truly in need of emergency care.
  • ED staff should be trained on these policies and procedures, and should regularly review them to ensure that they are being followed.
  • Keep detailed records of each patient visit including: reason for the visit, procedure coding, patient medical record, and the care provided.

This documentation can help to demonstrate to auditors that the care was indeed necessary.

By taking these steps, emergency departments can protect themselves from potential audits and help to ensure that all patients receive the best possible care. This documentation can help to demonstrate to auditors that the care was indeed necessary.

What to do if your claim is denied

When a claim is denied for medical necessity, the department should obtain a copy of the denial letter and see why the claim was denied.

Once you have that information, you can take the following steps to correct the problem and resubmit the claim:

  1. Double check the services were coded properly.
  2. Provide supporting documentation to show that the treatment was indeed medically necessary. This may include discharge summaries, progress notes, and lab results.
  3. Contact the patient’s insurance company to find out why the claim was denied and to see if there is anything that can be done to get the claim approved.

By taking these steps, you will increase your chances of success in getting the reimbursement you deserve.

Additional Options if ED Appeal is Denied

#1: The department can choose to appeal the decision.

  • This process typically involves gathering more information about the patient’s condition and submitting it to the insurance company for record review.
  • If the appeal is successful, then the insurance company will reverse its decision and pay for the treatment.

#2: Have the patient pay for the treatment out-of-pocket and then submit a claim to the insurance company for reimbursement.

  • This option is often successful (maybe delete), but it can be quite costly for the patient.
  • While medical necessity denials can be frustrating, it is important to remember that emergency rooms are designed to care for those who are in immediate need of medical attention.

#3: Finally, the emergency department can offer to provide care on a charity basis.

  • This option is typically only used in cases where the patient truly cannot afford to pay for their treatment.

Resources for more information

Ultimately, if a claim for medical necessity is denied, there are several resources that an emergency department can use in order to appeal the decision.

  • Contact your local medical society. They may be able to provide you with information about the appeals process.
  • Reach out to a billing service or an attorney who specializes in insurance claims.

These individuals can help you navigate the appeals process and make sure that all of the necessary documentation is submitted.


If appeals to the insurance company are unsuccessful, the final option is to file a lawsuit. However, this should only be done as a last resort, as it can be expensive and time-consuming.

If you are an emergency department experiencing difficulty getting a claim approved, RevKeep Software can help.

We can help you navigate the appeals process and make sure that all of the necessary documentation is submitted properly.

Contact us today to get started!

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