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4 Steps to Make Billing More Profitable
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Many medical practices are suffering an unprecedented reimbursement crisis. Since 2004, payments for all E&M codes have dropped from an average of $102.59 to $73.48, according to Physicians Practice (see chart).
Not only have collections declined, but the time required to get paid has stretched dramatically. Over 17% of the A/R for an average PT practice is beyond 120 days. Not only does this create cash flow problems, an unpaid claim that is 180 days overdue has less than a 1% chance of ever being paid.
This means the average rehab practice delivers almost one fifth of its services for FREE!
The payer-provider relationship has grown increasingly adversarial and one-sided in most cases. Here are four steps that can help you bring this relationship back into balance and protect the future of your practice.
Step 1: Join a Billing Network
A billing network unites many practices together to create efficiencies and leverage a single practice can't match. The network develops a shared knowledgebase of all payer encounters involving its members. This detailed information allows the network to accurately track payer performance and compliance and develop billing rules to optimize collections.
This means the billing network's knowledgebase can quickly flag trends by payers to deny or underpay certain types of claims. It can compare how different payers are reimbursing the same claims in various parts of the country. And it develops claim scrubbing rules to minimize the chance of denial before the claim is even submitted.
A single practice could never generate enough payer data to gain these valuable insights. For example, the BillNetPRO billing network has amassed over 2,000,000 rules that it uses to scrub every claim it processes.
Step 2: Move to SaaS Billing
Many practices are finding that traditional billing software simply isn't designed for today's fast-changing, highly competitive payer environment. High startup costs force many organizations to settle for less than the best solutions. Then there are even higher upgrade and maintenance costs to keep up with changes in billing rules.
Most systems offer limited functionality -- in fact it's hard to find anyone who is happy with their billing software. Web-based Saas (Software as a Service) billing systems solve many of these problems.
Low startup costs. A SaaS solution is typically billed on monthly, pay-as-you-go terms, so there are no prohibitive startup costs. It runs on a standard web browser connected to the Internet, which eliminates the costs of servers, networking and IT support.
Better functionality. Bypassing the IT structure of a practice not only makes a SaaS solution more affordable, it also standardizes the operating environment for the system developer. This leads to better functionality and reduces the likelihood of bugs and glitches that often occur in even longstanding software products. Also, the low entry and exit cost of SaaS provides greater incentive for the service provider to deliver an outstanding product.
Always up-to-date. With a SaaS agreement, you are always using the latest version of the software every time you log on. All upgrades and support are typically included in a monthly SaaS subscription.
Connect multiple sites efficiently. If your practice has multiple locations, a SaaS system converts the Internet into your personal network. There's no need for complicated workarounds like Citrix, or inefficient workflow methods that delay claims processing. All of your locations can access the billing system and share critical data.
Step 3: Outsource claim follow-up
A small in-house billing department simply doesn't have the resources to take on insurance companies effectively. A large medical billing network is able to bring in many dedicated billing specialists who can focus on specific payers or claim types. They can literally follow up with payers around the clock. Drawing on the extensive data from a billing network knowledgebase, they can follow up on claims more aggressively and effectively.
As a result, a large team of claims specialists will typically help you:
- Bring in a greater average reimbursement for your claims;
- Collect on a higher percentage of claims;
- Get you paid in fewer days.
As mentioned above, reimbursement delays not only slow your cash flow, they actually reduce the chances that you will be paid at all. This makes it even more important that you profit from a dedicated organization of claims specialists.
Step 4: Integrate All Your Practice Systems
When you integrate your scheduling and documentation systems with your billing, you eliminate the valuable time wasted on duplicate data entry. You also ensure that every scheduled visit is documented and billed...every treatment rendered during that visit is captured in full...and every claim matches the documentation. By closing the data loop in your practice, you can increase your practice revenue dramatically -- perhaps as much as 20%!
All signs point to the reimbursement crisis growing even worse in the years to come. Efficient, effective billing that levels the playing field with payers is critical to your practice. You can't make a living -- or deliver the best patient care -- without it.
Did you find this article helpful? Let your peers know about it on one of these forums...
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