Revenue Cycle Management · Medical Billing & Coding · Revenue Intelligence

Kitronixe Solutions

Underpayment Recovery

Underpayments measured against your verified contract, not a guess.

Expected versus actual reimbursement compared against contracted rates, with recovery of verified shortfalls.

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Expected vs paidExample Line A · Payer AIllustrative example

Expected allowed amount (from a verified fee schedule)$184.00

Paid / allowed amount$151.00

Variance: $33.00

Contract variance: eligible for recovery review

  1. 1

    Variance detected

    Paid below the expected amount

  2. 2

    Verification

    Contract term confirmed

  3. 3

    Evidence review

    Adjustments checked

  4. 4

    Recovery action

    Where appropriate

Illustrative example for a fictional line. Not a Kitronixe client result; invented amounts, not a real fee-schedule or payer amount.

Why short payments stay hidden

Paid is not the same as paid correctly.

A remittance that posts cleanly looks finished. Whether it matches the agreement behind it is a separate question, and one that needs the agreement itself to answer.

Payers do not always pay what their own contracts require. Without a comparison against the contracted rate, an underpayment posts as a paid claim and is never seen.

Kitronixe distinguishes clearly between a verified contractual shortfall and a benchmark comparison. Only the former is pursued as an underpayment, because only the former is one.

The distinction this page rests on

Only a verified expected amount can make a payment short.

Two kinds of difference look alike on a spreadsheet. One is measured against the terms your practice agreed with the payer, confirmed as current for that plan and date of service. The other is measured against a reference point, such as a published rate, a prior payment or an average. Only the first is treated as an underpayment.
Measured against
A contract or fee-schedule amount your practice provided, verified as current for this payer, plan and date of service.
What it is called
A contract underpayment, where the paid amount is below that verified amount and no valid adjustment explains the gap.
What happens next
The variance is documented and, where the evidence and the value justify it, taken to the payer.
What it supports
A recovery request grounded in the agreement your practice holds with that payer.

Before anything is disputed

Every possible variance passes one gate first.

The first question is never how large the gap is. It is whether the expected amount is known and verified. Answer each gate to follow a sample variance through the triage.
Variance triageAnswer each gate; the path lights up as you go

Step 1On this path

Potential variance detected

A paid line differs from the amount on file.

Is the expected amount verified?

Step 2 · if yes

Compare against the verified amount

Paid, allowed and adjustments are set beside the contract term.

Step 2 · if no

Benchmark / reference only

Without a verified expected amount there is nothing to hold the payment against, so the gap is reported as a reference difference only.

Reference difference: not labelled an underpayment

Step 3 · after a verified comparison

What does the comparison show?

Opens only when the expected amount is verified.

Path so far

  1. Potential variance detected

Answer the first gate to continue.

From remittance to resolution

Seven steps from a posted payment to a closed variance.

Each step leaves a record, so a variance can be picked up by anyone on the team and explained to the payer. The branch at validation is where most reference differences leave the path.
Recovery pipelineChoose a step to read what happens there

  3. Side branch at validation

    1. No verified contract amount
    2. Reference / benchmark only
    3. Not labelled contract underpayment

Step 1 of 7

Payment posted

The remittance is recorded against the claim, line by line.

What goes into a variance file

A variance is argued with evidence, not a hunch.

Before a payer is contacted, the file has to stand on its own. The checklist on the left is what we assemble; the capabilities beside it are how the work is done.
Variance fileA checklist of document types, not a client file
  • Remittance lineThe paid amount, allowed amount and adjustments exactly as the payer reported them.
  • Verified contract termThe contract or fee-schedule entry that sets the expected amount, with its effective date.
  • Adjustments reviewedEach payer adjustment on the line, checked against what the agreement allows.
  • Comparison worksheetExpected against paid, with the variance and how it was calculated.
  • Payer contact logWho was contacted, when, through which channel and what they said.
  • Decision recordWhy the variance was pursued, held or closed, so the reasoning survives a staff change.

How the file is built and used

  1. Fee schedule comparisonActual payment against the contracted expected amount.
  2. Contractual varianceIdentified line by line rather than in aggregate.
  3. RecoveryVerified shortfalls pursued with the payer.
  4. Variance patternsWhere payment differences appear, their size, and how often they recur.

Variance tracking

Every open variance has a status and an owner.

Variances move through named statuses rather than sitting in a spreadsheet tab. Choose a status to see what it means and what has to happen for an item to leave it.
Sample variance queueItems in each status today, with the sample difference still openIllustrative data

Potential variance

A paid line differs from the amount on file. Nothing is assumed yet.

Sample items
48
Sample $ at stake
$12,860

Illustrative data for a fictional practice: a snapshot of item counts and open sample differences, not a conversion funnel. Not a Kitronixe result, a client’s figures or a recovery rate.

Payer by payer

What each payer’s variances look like side by side.

A payer view only means something when it shows how the expected amount was sourced. A count against a verified contract and a count against a reference are kept in separate rows.
Variance by payerSample item counts, by how the expected amount is sourcedIllustrative data · Not payer performance

  • Payer AVerified contract

    Variance review
    12
    Open follow-up
    5
    Resolved
    8

  • Payer BReference only

    Variance review
    7Reference differences
    Open follow-up
    1Contract terms requested
    Resolved
    2Closed as reference only

  • Payer CNot available

    Variance review
    Not compared
    Open follow-up
    No items
    Resolved
    No items

Counts measured against a reference only are reference differences and are not labelled an underpayment.

Illustrative counts for three fictional payers. Not payer performance, not a Kitronixe result, and no real payer’s behaviour is implied.

What the reporting shows

  • Variance by payer

    Open and resolved variances, with the source of each expected amount shown beside them.

  • Open follow-up and its age

    What is waiting on a payer, and how long it has waited.

  • Outcomes recorded

    Corrected payments, explained differences and closures, reported as counts and amounts.

  • Reference differences, kept apart

    Gaps against a benchmark are listed separately so they are never added into a shortfall total.

Want a rough sense of scale first? Try the revenue leakage calculator with your own figures. It gives an estimate from the figures you enter, not a contract finding.

Revenue leakage calculator

Where it sits

It starts where the payment is posted.

Underpayment work depends on posting that records each line accurately, and it feeds follow-up and reporting after it.

Where Underpayment Recovery sits in your revenue cycle

  • 07Payment Posting & Reconciliation· Back End
  • 09A/R Follow-Up & Recovery· Back End
  • 11Reporting, Analytics & Revenue Integrity· Intelligence

What the work draws on

Four sources behind every comparison.

The review uses what your practice already has. Access is arranged with your team, and the work stays inside your systems and the payer’s own channels.
  • Payment dataRemittances and posted payments, line by line, from your practice management system.
  • Contract & fee schedule referenceThe agreements and fee schedules your practice provides, kept with their effective dates.
  • Payer portalPayment detail and dispute submission, where the payer offers them online.
  • ReportingVariance status and outcomes, shared in the format your team already reviews.

Connected work

The services a variance touches on its way through.

Underpayment questions

What practices ask before sharing a contract.

All FAQs
How do you determine expected reimbursement?

From the contracts and fee schedules your practice provides. We confirm that the document is current for the payer, plan and date of service before using it, and we record which document set each expected amount. Where no verified document exists, we do not produce an expected amount of our own.

What if our contract is unavailable?

Then a payment cannot be shown to be short of it. We can still compare payments with a reference point and report the differences, clearly labelled as reference differences. Many practices use that list to decide which payers to request contract terms or fee schedules from.

How do you distinguish an underpayment from a benchmark difference?

By what the payment is measured against. A contract underpayment means the paid amount is below a verified contract or fee-schedule amount and no valid adjustment explains the gap. A difference from a benchmark, published rate or prior payment is a reference difference and is not labelled an underpayment. The two are reported separately and never added together.

Do you dispute every variance?

No. Variances are triaged by the strength of the evidence and the value at stake. Some are explained by a valid adjustment, some are too small to justify the payer’s time or yours, and some need contract terms confirmed first. Only documented variances worth pursuing go to the payer.

Which payers or contracts can you review?

It depends on what your practice can provide and on how each payer handles payment questions. We review the agreements and fee schedules you share, for the payers you choose. We cannot promise that any payer will agree to a correction, or on what timeline.

Find out what your contracts actually support.

Start with the agreements you have. We will tell you which payments can be checked against them, and which can only be compared with a reference.

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