What is payment variance and how does Rivet calculate it?

Payment variance is the difference between what you expect to receive from a claim versus what you actually receive. Rivet's Underpayments product allows you to analyze both overpaid and underpaid claims, but you'll likely spend the bulk of your time on underpaid claims.

Rivet uses your allowed amount from your payer contracts and the payer rules you've set up and compares them to your claims to determine the amount of variance.

Who is at fault for payment variance?

According to Becker's Hospital Review, both payers and providers are at fault.

For each group, they cite the most common mistakes as the following:

Payer Mistakes

1. Pricing claims using incorrect contract terms

2. Calculating allowed amounts incorrectly

3. Interpreting contract terms differently

Provider Mistakes

1. Submitting bills incorrectly and/or without required documentation

2. Taking too long to identify incorrect amounts

3. Interpreting contract terms differently

Thankfully, Rivet's Underpayments tool helps you correct payer and provider mistakes and understand what caused them. Check out our other articles to get started.