Reducing Insurance Claim Rejections through Lean Six Sigma: A Quality Improvement Initiative at Mediclinic Welcare Hospital, UAE

Background: Hospital pharmacies face challenges with insurance claim rejections, affecting revenue cycle management and efficiency. Lean Six Sigma methodologies provide structured frameworks for enhancing process efficiency. Objective: This study aimed to evaluate the impact of implementing Lean Six Sigma (LSS) principles on reducing insurance claim rejections at Mediclinic Welcare Hospital Pharmacy in Dubai, UAE. Methods: A quality improvement project framework was applied using the DMAIC (Define, Measure, Analyze, Improve, Control) methodology. Baseline data were collected from January to March 2024, with interventions implemented from April to August 2024. The validated key performance indicators (KPIs) included (1) A percentage improvement in staff competency in handling claims, (2) Reduction in total cost due to claim rejections, and (3) Improvement in the accuracy of pharmacy billing systems. KPIs were mapped, challenges identified, and targeted interventions implemented. Statistical analysis using the Mann-Whitney U test (P<0.05) and Sigma-level calculations quantified improvements and process efficiency enhancements. Results: Implementing LSS interventions significantly increased staff competency in handling claims, from 50% to 93% post-intervention (P <0.05). The sigma level also improved from 3.1 to 4.0. KPI (2) saw a 70% reduction in total costs associated with rejections. KPI (3) reflected a 111% improvement in billing accuracy, increasing from 45% to 95% (P <0.05). The Sigma level for billing processes improved from 3.1 to 4.1, signifying enhanced process stability and reduced Defects Per Million Opportunities. Conclusion: Applying Lean Six Sigma at Mediclinic Welcare Hospital Pharmacy improved process accuracy in reducing insurance claim rejections. This approach fostered operational excellence, a culture of continuous improvement, and long-term process efficiency, highlighting LSS as an effective strategy in healthcare. Keywords: DMAIC, Hospital Pharmacy, Insurance Claim Optimization, Process Improvement, Revenue Cycle Management, Sigma Level