As Medicare-certified home health agencies (HHAs) face the possibility of lower reimbursement rates in 2026, developing strategies to maintain and even grow margins is more important than ever. One driver to focus on is claim denials. In 2025, overall claim denial rates continued their upward trend, thanks in part to AI-powered claim reviews. 

While initial denials can be appealed and reversed, the time it takes you or a member of your staff to chase down a reimbursement costs you money and productivity. And many Medicare claims are denied for reasons that could have been prevented. 

The good news: there are strategies you can use to reduce the number of denials you receive, even as you qualify more patients for home health services.

Why Do Medicare Denials Happen?

Medicare doesn’t mess around when it comes to claim reviews. With nearly 69 million beneficiaries currently enrolled, and another 11 million expected in the next five years, Medicare can’t afford to pay for medical nice-to-haves. 

So they require indisputable documentation showing that each service provided was medically necessary. Without that documentation, claims get denied.

These issues aren’t just bureaucratic. If a claim is denied, care stops. Families get anxious, patients can land in the ER, and HHAs lose money. That’s why understanding the main triggers for Medicare denials is essential for every agency leader.

5 Most Common Denial Reasons - And How To Avoid Them

The current Medicare Benefits Policy Manual outlines in chapter 7 the requirements for coverage of home health services. Here, we’ll focus on the five claim issues that trip up agencies most often. 

1. Requested Records Not Submitted

Agencies are required to promptly submit all required records when Medicare sends an Additional Documentation Request (ADR). Without those records, Medicare can’t determine medical necessity. In the first quarter of 2025, about 40% of home health denials were simply due to required records that weren’t sent when requested. 

How to avoid this denial:

This administrative error should be fairly easy to prevent if you check all of your patients’ records for completeness and accuracy as you receive them, and keep them organized. Once you have that system working, you need to make sure to submit all requested medical records within 30 days of the ADR date (this is in the upper left corner of the ADR). Securely attach a copy of the ADR request to the claim and send to the address on the ADR. If the records aren't received by day 46, the claim will auto deny. 

2. Plan of Care Issues

Medicare won't pay a claim if a patient's Plan of Care (POC):

• isn’t signed and certified by the patient’s physician (or re-certified in the case of ongoing care) 
• is outdated
• is missing entirely from the claim documentation

Because again, without a certified POC, Medicare can’t know that the care provided was medically necessary.

How to avoid this denial: 

Include a complete POC with your claim, legibly signed and dated by the doctor. The POC is complete when it includes:

• all relevant diagnoses
• patient’s mental status
• types of services, supplies, and equipment required
• frequency of home health visits
• patient prognosis
• rehab potential
• functional limitations
• activities permitted
• nutritional requirements
• all medications and treatments
• safety measures to protect against injury
• discharge or referral instructions

The same physician who establishes the POC should provide the certification. That physician must certify that: 

• the patient is homebound and needs intermittent skilled nursing care,, PT, ST, or OT
• a POC has been established and the doctor periodically reviews it
• the services were provided while the patient was under the care of the physician

3. Inadequate Face-to-Face Encounter Documentation

Medicare wants to know that the patient’s physician (or an allowed non-physician practitioner) has met with them in person or via a telehealth visit no more than 90 days prior to the start of care or within 30 days after the start of care. If documentation of this encounter is incomplete or missing, Medicare will deny the claim. 

How to avoid this denial: 

Face-to-face encounter documentation should include:

• the date of the encounter with the certifying physician 
• the physician’s description of the patient’s condition during the encounter, and how their condition supports their homebound status and home health needs
  

The physician can document the encounter on the signed, dated certification or on a signed addendum to the certification. 

4. Medical Necessity Not Supported:

If clinical notes don’t clearly show why skilled nursing, therapy, or home health aide services were needed, Medicare will deny the claim. Note that per the Medicare Benefit Policy Manual the patient’s potential for improvement does not impact coverage of home health services. Coverage is determined by the patient’s need for skilled care.

How to avoid this denial:

When you submit the claim, make sure to include:

• the initial therapy evaluation
• current therapy re-evaluation(s) for the episode under review
• previous therapy re-evaluation(s)
  

Your supporting documents should clearly indicate the medical necessity of the 

services your agency provided. These services must:

• be reasonable and necessary for the treatment of the patient’s illness or injury
• be reasonable and necessary for restoring or maintaining function affected by the patient’s illness or injury
• require the skills of a skilled nurse or therapist, and the care can be performed safely and effectively only by, or under the supervision of, a skilled nurse or therapist

5. Incomplete or Missing Orders

Medicare will automatically deny any service lacking specific, signed physician orders that were provided prior to the start of care. 

How to avoid this denial

Only start care when you have received a complete referral order from the patient’s physician. And make sure all services provided and billed are noted on the order and in the POC. The order has to include:

• the type of services to be provided to the patient
• the professional who will provide them 
• the nature of each service,
• the frequency of the services

Practical Strategies for Home Health Agencies

A well documented claim is less likely to trigger an ADR and less likely to be denied. These strategies can help you improve documentation and reduce claim denials.

Standardize Your Process

Create checklists and digital templates for every claim, and follow them to a T. Upload all physician orders and POCs to your system, and confirm they’re signed before any start of care. Document the face-to-face encounter clearly with dates, physician details, and medical context. Train your team to make documentation a habit. 

Communicate Clearly

Review documentation for completeness before submitting a claim. Remember to check physician orders, POCs, certifications, and addendums for signatures and dates. It’s also wise to educate patients and families about what Medicare covers and what’s needed for recertification, so they can know what to expect and keep you apprised of any changes in the patient’s condition and care needs.

Verify Eligibility 

In order to qualify for the Medicare home health benefit, a beneficiary must meet Medicare’s definition of homebound and have health conditions and care needs that make home health care medically necessary. And they have to provide a current home health referral order from the physician (or allowed practitioner) who’s most familiar with their health and care needs.

This is easy enough to verify when a patient is referred to your agency from a hospital or rehab facility. But there are millions of homebound Medicare beneficiaries living in the community who likely qualify for home health care but aren’t receiving it. 

Identifying and verifying eligibility for these underserved patients takes time and legwork that few HHAs have bandwidth for. But this population has the potential to grow your census significantly.

Leverage Technology 

RubyWell is a technology company that helps families and providers safely manage health at home. We partner with HHAs to help you grow your census by serving patients in your community who qualify for home health services but aren’t receiving the care they’re entitled to. 

Through proven outreach methods targeting family caregivers, we identify patients on Original Medicare who likely qualify for the home health benefit. 

Our technology leverages AI to predict if they may be eligible for covered services, and generates a Home Health Discussion Guide containing health data that indicates medical necessity for home health services. 

We advise the patient to share this document, as well as a sample home health order, with their physician during their face-to-face encounter. The physicians can then use these to create a thorough home health order, often reducing or eliminating the back-and-forth between agency and physician before care can start.

When the home health order is issued, we immediately refer the patient to our partner HHA in their area. 

Through this process, we’re able to deliver eligible patients to your agency, with documentation that supports the medical necessity of their care.

We’re also piloting a program in Arizona and Pennsylvania that helps eligible patients’ family caregivers get trained and certified as home health aides. So our partner agencies can hire them as a member of their loved one’s home health team. 

Guidance for Agency Owners

Every denied claim means a patient waiting longer at home for the care they deserve, while agency margins shrink. 

Putting processes in place at your agency that prioritize thorough documentation, timely submissions, and clear communication can help keep the care flowing for eligible patients, and keep Medicare reimbursements flowing for you. 

By analyzing patient insurance coverage, homebound status, health conditions, and care needs, RubyWell identifies patients on Original Medicare who will meet criteria for skilled care. This allows our partner agencies to focus resources on evidence-based referrals, reducing wasted labor.

We conservatively estimate that over 12 million Original Medicare beneficiaries are eligible for covered ongoing home health services. But concern about costly claim denials may be one of the things keeping many home health agencies from tapping this revenue source. 

Our proprietary eligibility screening technology empowers home health agencies to confidently and compliantly expand their patient profile to include Original Medicare beneficiaries while lowering the risk of claim denials.

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RubyWell currently partners with home health agencies in Arizona and Pennsylvania. And we’re expanding to Connecticut, Florida, and Massachusetts this fall. Learn more about partnering with us or schedule a meeting here.

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