October 2019 Edition Vol.11, Issue 9

Are Commercial Payers in Denial About Denials?

By Tracy Lewis and Bobbi Buell, onPoint Oncology

In the April 2019 OBR issue, we issued a report card on U.S. commercial health plans’ denial rates and days to payment in the oncology practice setting. In that article, we showed how Blue Cross/Blue Shield plans are some of the most optimal U.S. private health plans in terms of both days to file and days to payment. Their denial rate, while not as low as Medicare, is lower than other national commercial health plans. In addition, their claims’ velocity along with lower rejection rates is key to minimizing drug Accounts Receivable.

National commercial health plans like Aetna, Humana, and United Healthcare, have wide variations in performance, unlike the BC/BS plans. Denial rates for these plans range from 4% to 65% and days to pay spans from less than 30 to as high as 53 days.

This broader range of results for commercial plans may be justified for several reasons. First, these are independent, mostly publicly traded plans that compete against each other for patient lives, whereas Blue Cross/Blue Shield plans tend to function as a loosely held alliance. It also suggests that commercial plans have become more cautious, and some might consider more restrictive, in paying for expensive chemotherapies, drug combinations, and in particular, immunotherapies with multiple indications.

For this report, we used our proprietary software, focalPoint®, and omitted Blue Cross/Blue Shield plans and focused on the largest non-Blue Commercial plans. These plans also include some Part C, Medicare Advantage, and may also include Managed Medicaid. We then compared those plans to Medicare in terms of denial rates, days from service to claims filing (Days to File), and days from service to positive adjudication (Days to Pay).

focalPoint combines (vs. uses) conjoined claims and remittance data from community oncology practices (735 sites) who buy and bill, which we define as billing drugs on a CMS-1500. focalPoint data pinpoints the commercial/private plans that have the widest variances in denial/rejection rates and days from drug administration to payment.

We compared the top six most expensive injectable drugs (highest payment per unit) to see if those products are treated differently by the commercial plans and perhaps, are driving the overall denial rate.

For this analysis, we include an explanation of how we tracked the data. Denials (i.e. claim rejections) for drugs represent money tied up in expensive drugs and awaiting reimbursement. Here are the definitions we used in our analysis:

  • Date of Service – date that patient was actually given the drug
  • Date of Filing – date that the patient’s insurance carrier had a claim filed
  • Date of Response – when the practice got a response from the payer
  • Days to Filing – the time it took to file the claim(s) from the date of service
  • Days to Pay – the time from date of service to the date of first payment

Unlike the pharmacy benefit, where there can be instant adjudication, community practices buy and bill physician-administered drugs under the medical benefit, which means they order and purchase the chemotherapy/immunotherapy drug first; store and manage it; administer it; bill the insurer; and, then hope the insurance payment comes before the drug bill comes due.

Days to Pay is an important metric for community oncologists. Days to File is a clue into the complexity of gaining approval for drugs and drug claim preparation. Long Days to File usually means issuing the claim is problematic while long Days to Pay with short days to file means payers are delaying claims for their own reasons.

Since this analysis is comparing Traditional Medicare to commercial payers, we asked the question: Is Medicare the “gold standard” of timely and appropriate payment?

First, Medicare has national laws that govern its prompt payment. According to Medicare Rules,1 clean claims filed electronically can be paid as early as 14 days after receipt, i.e., a 13-day payment floor. Suppliers who file paper claims will not be paid before the 29th day after the date of receipt of their claims, i.e., a 28-day payment floor. Interest payments will begin on the 31st day after the date of receipt for clean electronic and paper claims that are not yet paid. This rule is one with which all Medicare contractors, except Durable Medical Equipment MACs, must comply.

At onPoint Oncology, we not only look at the speed at which claims are paid, we also concentrate on determining the root cause of denials. Denials can be simple rejections for administrative reasons (e.g., missing provider number, missing medical record, wrong NDC code, etc.) which require practice or payer education.

There are also medical necessity denials which may require an appeal and/or clinical education on product labeling for payer reviewers. Denial reasons and their associated denial percentages help the onPoint data team advise clients to either focus on the practice or the payer or both, to ascertain a resolution to denial issues.

For this analysis, we used focalPoint®’s statistically-significant database for all oncology drugs: branded, generic, biosimilar, and supportive care. We compared Medicare against the top nine non-Medicare fee-for-service, non-Blue national plans (by claim count in our system) for 2019 Year-to-Date (Table 1).

We noted some major similarities in days to pay (DTP) and days to file (DTF) among the national payers. For marketing purposes, large national payers might maintain a level of service that is at least equal to Medicare in this regard. Some plans were considerably worse for cancer patients, yet no commercial plan paid faster on average than Medicare. Denial rate differences were dramatic among the payers.

Therefore, Medicare truly is the gold standard for predictable payment and timeliness to payment. Our results shown herein confirm this hypothesis. The Medicare overall denial rate was much better than the average and no commercial plan outperformed Medicare in DTP or DTF. We were surprised at how similar national commercial plans were on these metrics.

Using the same criteria, we wondered what would happen if we compared the most expensive physician-administered cancer drugs with Medicare against commercial plans?  We monitored expensive oncology biologics and immunotherapies daily and analyzed the mechanisms employed by payers (commercial plans especially) that restrict access or create claim submission challenges in order to control utilization.

Using Medicare as the standard, we then compared the metrics on those drugs to see if our hypothesis is correct: that these expensive drugs can be big drivers for high denial rates. According to Genetic Engineering and Biotechnology News, the top six most expensive oncology biologics are2:

Table 3 shows the comparisons of DTP and DTF for the most expensive biologics currently used in hematology/oncology compared with Medicare.*ASP pricing was supplied by Q3 CMS 2019 ASP drug pricing files.

We were somewhat surprised to see how close DTP and DTF are for these drugs. When we examined denial rates, however, we saw a significant difference. Surprisingly, Medicare denial rates on expensive therapies were lower than the overall Medicare average, while commercial plans’ denial rates on those drugs were much higher than Medicare (Table 4).


The major learnings from this assessment are that DTP and DTF seem to adhere to a fairly wide standard and are very similar across the major payers in oncology. This may be due to several factors. As we stated, parity with Medicare may be a factor. Also, there are also State Prompt Pay laws to which plans must adhere, if claims are deemed clean.3 This is obviated in our previous article wherein the Blue Cross/Blue Shield plans were similar to the ones examined herein.

The Blues had an average DTF of 8 to 10 days and DTP from 28 to 30 days on drugs with assigned HCPCS codes. What we learned last time, and again this time, is that all commercial plans had vast differences in denial rates:  Blues, national, and local commercial plans have denial rates that are much higher than the Medicare standard.

Based on our analysis, the more expensive drugs tend to drive denial rates for these plans. Are plans rejecting claims for clerical or administrative reasons to increase the appearance of cash for their shareholders? Are there restrictive policies designed to decrease spend in oncology or for branded drugs?  We will let the reader reach their own conclusions for now. These are just the facts as we report them (disclaimer below). Next time, we will further examine the types of denials that exist today and see what obstacles payers place in the paths of oncology practices that prevent efficient payment and add to the frustration of managing a buy and bill practice.


  1. Noridian Healthcare Solutions. Clean claims. https://med.noridianmedicare.com/web/jddme/claims-appeals/claim-submission/clean. Accessed August 21, 2019.
  2. Alex Philipidis. Genetic Engineering and Biotechnology News https://www.genengnews.com/a-lists/top-10-best-selling-cancer-drugs-of-2018/
  3. Elizabeth Woodcock. Prompt Payment Laws by State & Sample Appeal Letter. http://www.elizabethwoodcock.com/resources/prompt_pay_laws_by_state.pdf. Accessed August 21, 2019.


About onPoint Oncology

onPoint’s proprietary product, focalPoint®, is the only real time payer surveillance product for physician-administered therapies. We focus on the payment integrity and speed in office-administered drugs by bringing targeted claims information to both practices and pharmaceutical reimbursement teams. The common goal of both segments is to improve manufacturer reimbursement programs and enhance patient access to cancer drugs. Customers are able to take immediate action to optimize denial/rejection rates, days to pay, days to file, and claims
re-submissions. This report focuses on just two key metrics of those described above.


  • Reports are run with ALL office-administered oncology drugs aggregated within focalPoint – there are major fluctuations within individual drugs due to many external factors:
    • Whether the drug has a distinct HCPCS code
    • Where the drug is in its life-cycle
    • Payer policy regarding a drug or class of drugs
    • Practices’ level of billing sophistication
    • Pharmaceutical reimbursement team’s level of participation and effectiveness.
  • For this inaugural edition we looked at Calendar Year 2018. In the future issues, reports will be generated by quarter
  • Our goal is to simply educate and inform, not to single out a particular payer, product, or manufacturer, but there are issues that should be addressed as you will see.
  • Any questions or clarification please contact info@onpointoncology.com.

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