4 Charlesview Road, Suite 4, Hopedale, MA 01747
(508) 422-0231 Consulting Services
(508) 422-0233 Account Matters
Over the years, I’ve heard the “Where’s My Money?” line over and over from private practice owners. The answer can be difficult if you don’t have first hand knowledge of each of your patient accounts. Chances are you don’t have a first hand knowledge of each account so the question is – do you have a biller/collector on staff that does?
Getting paid for services rendered begins when you receive the first phone call from a patient. The flow will usually go this way: the patient is processed by the front desk specialist and then is seen by the therapist who submits their charge sheets to the biller for data entry and or enters their own charges that get reviewed by the biller who then submits the claims and then we wait for the reimbursement to come in. A seamless operation – right? Yes for the most part, but what if the reimbursement doesn’t come in? Then it’s time for your collector to get busy and find out where the money is.
The first step to getting paid is to bill correctly. It is imperative that you have a well-trained staff that understands CPT and ICD-9 coding, insurance contracts, rules and regulations, the entire billing system and then enters accurate data. The use of the billing system is where I find most errors begin – the billing staff is not completely trained on every function of the billing system and/or the system in place is in need of an upgrade. Additionally, you must have all authorizations and/or referrals in place and bill according to federal and state rules and regulations. Assuming all that is in place, and your patient data is correct, you should expect payment for your services, however, that is not always the case. Maybe you’ve billed some HMO’s before the referral hit their system – result, no payment until you call and correct the situation. Maybe you have authorization, a referral – everything you need – still no payment. Maybe you have sent all the requested information and still no payment. What could be wrong?
Actually, you may be doing everything right – that doesn’t always mean you will get paid. Communication between the front desk, therapist, biller and collector is paramount to the success of getting paid for services rendered. The knowledge shared is important in order not to miss why claims may have been billed a particular way or why the claim is being held up. In small practices the position of biller and collector may be one in the same. Sharing problems regarding the computer system, data entry, delayed billing, electronic billing and printing paper claims are just some of the reasons that can result in delayed payments or no payments.
A skilled collector knows that in many cases in order to get the bill paid, a call or two or three must be made. That connection is necessary to insure that the claims not paid within 30 - 60 days are followed up on to solve the problem and insure that current and future claims will be paid. Follow-up is the key to insuring that all unpaid claims billed out are paid.
I have found that in many of the clinics I have assessed the follow-up on unpaid claims is poor and sometimes almost non-existent. I have also found that the person on staff that has been assigned to collect on past due accounts is not as efficient as they could be. All information needed to follow-up on unpaid claims should be in your system. Notes should always be up to date including what the patient’s insurance benefit is, what the authorization/referral number is and what dates it covers, and any and all correspondence that has transpired on the claim. Discharged files should be nearby so if information such as a physician referral is requested – it can be easily found and faxed. Active files should not be too far away either for the same reasons.
There may also be some paid claims that end up being challenged because the payor believes the claims were paid in error. In a case like this, investigation as to who is responsible for the claims must begin. This now involves making several phone calls to insure that if a reimbursement needs to be made that payment from the other source will soon follow.
I have always found that the hardest unpaid claims to collect on are patient balances. It seems that many patient’s put medical bills last on their list of what to pay. Collecting co-pays, some portion of co-insurance and deductibles at time of service helps to reduce the amount of patient owed balances. Collection of patient balances by the front desk is one of the key functions of that position and there should be no excuses for not collecting. Once again a good billing system should be able to produce a daily report of patients who owe co-pays and other co-insurance balances. Also, a strict patient “payment at time of service” policy and giving payment alternatives to patients – cash, check or credit card lead to a more successful collection rate.
It is also important to have a system set up to collect on patient accounts that the collector has exhausted all efforts on. This could be an attorney who will take accounts and send out 1 or 2 letters and make a phone call on or an agency who takes similar action. Typically, most attorney offices or collection agencies take 1/3 of what is collected. You should not have to pay any additional fees to use an outside agency unless the case is going on for further litigation. In the end, patient balances up to $300 not collected by your outside source are usually written off as a bad debt because it can cost you more to take them to court and that is not always a guarantee of payment.
I usually recommend that patient statements go out at least once a month. For balances that are 100% patient balances I encourage that statements go out every 15 to 20 days in 3 cycles with a progressive note on those going out a second and third time stating on the third one that the account will be going on for further outside collection if the account is not paid in 10 days. I believe that if a patient does not respond to a series of statements they are not going to pay whether you send 3 or 300. The objective is to move quickly and not let the account age to the point where you may not be able to find the person and thus lose out on collecting options. Getting the account to your outside agency quickly increases your chances of collecting – two thirds of the payment is better than none.
Another very important factor in facilitating prompt payment of claims is to answer daily requests for information and daily denials immediately. My rule is that if you are receiving more denials in a day than you can handle in a day, you have a serious problem that must be rectified immediately in order to stop denials for repetitive reasons.
What is a denial? A denial is a written response from an insurance company in regards to a claim you submitted stating that the claim is not valid and will not be paid. It could be for several reasons. For example: patient’s insurance does not cover physical therapy, patient’s insurance not valid at time of service, claim was submitted over the filing limit, no authorization or referral in place at time of service or you are not a provider. Although some denials are flat out wrong – it will still take a phone call to straighten out the problem in order to turn the denial around and get paid and/or call the patient for assistance.
Don’t be confused between a denial and a request for more information. Many times you receive a request for more information – a copy of the doctor’s prescription, a copy of an explanation of benefits (EOB) from the primary insurance, or copies of notes. These are not denials – no one is saying you will not be paid – they are saying they cannot pay without the requested information. Many times the information can be faxed or emailed. If you answer the request immediately, chances are very good you will receive a check within a week, however a follow up call is a good idea to insure that the insurance company received the information and that a check is being processed.
A good way to keep current on your aging accounts is to run an accounts receivable report every week. This report tells you how old each account is. Typically, an accounts receivable report lists patient accounts as follows: current, 30 –60 days old, 60-90 days old, 90–120 days old and accounts over 120 days old. Many systems will let you change those aging categories to whatever you like.
All business owners should become familiar with and learn how to read their accounts receivable report. This report along with other financial reports from your system and checking the daily mail for denials will help you to uncover where you may be having trouble with payments. The goal here is to determine what accounts are aging but still collectible and those that are not. If you determine that some accounts are not collectible you must record the reason why to insure that revenue is not lost for that reason again.
Weekly meetings with your staff and asking direct questions regarding the status of patient accounts and insurance issues will also help to evaluate the skill level and productivity of your staff. For example, in your weekly meeting you should be asking questions regarding billing issues that are affecting reimbursement (number of units & coding), inconsistencies or a change in reimbursement, take-backs on accounts, number of denials, new insurance information that will affect reimbursement positively or negatively and specific problem patient accounts.
By reviewing your accounts receivable each week, you will be able to see accounts that continue to age and then you can ask questions as to the status of the account and how and when the account will be paid. You can also learn how to go into the system and randomly check patient notes to see that accounts are consistently being checked on. Your collector should have clear understandable answers to all your questions.
In the end, you should know ‘where your money is’.
Diane McCutcheon, President
DM Business Management Consulting Services, Inc.
Account Matters – Billing & Collection Services
4 Charlesview Road, Suite 4
Hopedale, MA 01747
P: 508-422-0231 F: 508-422-0234