Maryland MCOs Incorrectly
Denying Laboratory Claims
How BIS Restored Revenue Flow Through Proactive Payer Engagement and Regulatory Expertise
Problem
MCO Non-Compliance
Despite a January 2025 Maryland Department of Health bulletin clarifying MCO responsibility for laboratory claims, several Medicaid MCOs continued to deny these claims incorrectly.
Misdirected Billing
MCOs incorrectly redirected providers to bill Optum Maryland, which was no longer responsible for processing laboratory claims per the state directive.
Payment Delays
The misalignment between MCO practices and state policy led to significant payment delays and disrupted revenue flow for the client.
Revenue Impact
Persistent claim denials resulted in severely suppressed laboratory payment rates, threatening the financial sustainability of the provider's lab operations.
Solution & Approach
Detailed Claims Review
BIS conducted a thorough review of denied laboratory claims to identify patterns, root causes and the scope of MCO non-compliance with the Maryland Medicaid directive.
Payer Relations Escalation
BIS worked closely with payer relations teams to escalate the issue with proper policy references, citing the January 2025 Maryland Department of Health bulletin directly.
Continuous Follow-Up
Persistent and structured follow-up cadences were maintained with the involved payers to ensure accountability and sustained progress toward resolution.
Regulatory Reinforcement
Through collaborative discussions with MCOs, BIS reinforced the state's billing directive and worked to correct the adjudication process to align with Maryland Medicaid guidelines.
Compliance Alignment
BIS leveraged its regulatory expertise to bridge the gap between MCO practices and state policy, ensuring proper processing of laboratory claims beginning September 2025.
Outcomes
Laboratory payment rate before BIS intervention
Laboratory payment rate by November 2025
Improvement in lab reimbursement rates
Claims began processing without denials
Lab claims processed correctly per MDH guidelines
Impact
Revenue Restoration
Consistent revenue flow for laboratory services was successfully restored after months of disruption caused by MCO non-compliance with state billing directives.
Reimbursement Improvement
Laboratory payment rates increased dramatically from 4% to 17% between September and November 2025, reflecting a significant and sustained improvement in reimbursement trends.
Regulatory Compliance
MCO adjudication processes were corrected to align with Maryland Medicaid guidelines, ensuring long-term compliance and reducing the risk of future claim denials.
Payer Accountability
BIS's proactive escalation and persistent engagement established a clear accountability framework with payers, setting a precedent for faster resolution of similar issues.
Operational Confidence
The client gained greater confidence in revenue cycle predictability, with laboratory claims now processing reliably in accordance with the state's established billing directives.
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