Recovering denied and short-paid warranty claims

Where the money goes

Denied and short-paid claims rarely add up on any one day, so they get written off one at a time. Across a year and several rooftops they are often one of the largest recoverable losses in fixed operations.

The usual reasons

• Missing or weak documentation: story, cause and correction that do not support the repair.
• Labor time above the manufacturer's standard for the operation code without a justification.
• Prior approval required and not obtained, or obtained after the repair.
• Wrong operation, causal part or failure code.
• Submitted after the manufacturer's filing deadline.

Triage by value and fixability

Sort by the amount at stake and by whether the reason can be fixed with information the dealership already has. Documentation and coding issues are usually fixable; a missed prior approval often is not. Work the fixable, high-value claims first, each within the manufacturer's resubmission window.

Stopping repeat denials

Track the denial reason by technician, advisor and operation code. Most stores find that a handful of patterns account for most of the lost dollars, and those are fixable with a checklist at the point of write-up.