revenue strategies in rural health clinics-making the most...

Revenue Strategies in Rural

Health Clinics- Making the Most

of Your Resources and Time

Deborah HolzmarkSenior Manager

Physician Services Consulting Group Dixon Hughes PLLC

dholzmark@dixon-hughes.com

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Agenda• Why is it getting so hard?

• Making the Most if It – Patient Collections and Time of Service Collections

– Managed Care Contracts

– Provider Production and Compensation

– Coding– Coding

– Technology

– Work Flow

• Motivation Guidance

• Questions to ask….

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Why?

• Market Consolidation

– Fewer payors = less competition

– Lowering of the reimbursement bar

• Managed Care Maturation

– Added complexities– Added complexities

– Medicare Advantage Plans

• Reimbursement Deterioration

– Changing edits

– Lower flat reimbursements

• Limited revenue enhancement opportunities

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35%

40%

30%

35%

40%

45%

All small firms (3-199

workers)

All firms

Percent of insured workers with a

deductible of $1,000 or more for single

coverage

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16%

21%

10%12%

18%

22%

6%8% 9%

13%

0%

5%

10%

15%

20%

25%

2006 2007 2008 2009

All large firms (200 or more

workers)

Uncollected Patient Balances• Why are all these dollars being written off?

(by each physician)

– Uncollected Copays

– Uncollected Coinsurance

– Deductibles for surgeries

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– Deductibles for surgeries

– No Coverage

– ER call cases

– Timely Filing

– No Authorization

– Many $$$ were from patients WITH insurance

Unexpected Adjustments

$40,000

$50,000

$60,000

$70,000 $66,175

Unexpected Adjustment Comparison Source : January - June 2009 Billing Manager Report

Adds up to an estimated $100,000 in lost revenue over one year

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$-

$10,000

$20,000

$30,000

$40,000

Timely Filing Uncollectible Deceased/no

est.

Small Debt No Auth. BC Indigent Provider Not

Cred.

$22,453

$7,871$6,194 $6,000 $3,149 $2,924

Time of Service Collections

• Why is this so important to track?

– Medical Bills – bottom of the priority list

• Folks will first pay the essentials

– “Wealth Without Risk” by Charles Givens

• Page 21-22 – don’t pay your medical bills – interest free

– Patients feel it is a RIGHT not a privilege

– Consumer Driven HealthCare

– We enable this behavior

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Time of Service Collections

• Most practice AR is patient responsibility =

about 50% over 120 days and older

– Old payment plans

– No statement accounts

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– No statement accounts

– The “black hole”

• The longer it ages…the less likely we will ever

collect

• The “best” collect payment at time of service

75%-90% of the time…

Real Time Claim Adjudication

• Just imagine…

– Adjudicating a claim at the time of service

– Handing the patient their EOB at check out

– Collecting their responsibility– Collecting their responsibility

– Never shows up on the AR

– No letters or phone calls

– No statements

– Patients & Staff are happier

Trend your TOS Efforts

$100,000

$110,000

$120,000

$130,000

Comparison Time of Service CollectionsSource: PM Reports

$40,000

$50,000

$60,000

$70,000

$80,000

$90,000

$100,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Prior Period 2007 Current Period 2008 Linear (Current Period 2008)

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Claims Management Benchmarks

Submission

• Daily

• Electronically at least 90%

• Charge Entry –

Lag Times

• Charge Entry –Submission < 72 hours

• Service to Charge Entry < 48 hours

Denials

• < 5% on 1st

submission

• Appeals Filed within 5 days of posting

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Claims

Management

The Physician Billing Process: 12 Potholes to Avoid in the Road to Getting Paid 2009 Edition Walker, Woodcock, Larch & MGMA Best Practice Survey 2008

Claims Management Benchmarks

Scrubbing

• All Claims

• Verify Eligibility 90%

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QA Audit

• 5% per team member per month

Missing Charge Audit

• 10% of claims per month

Claims

Management

AR Aging

• AR Aging Buckets – look at by Payor

– What does it tell you?

• If your dollars are aging in a consistent manner comparable to peers

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comparable to peers

– What impacts this number?

• System aging parameters

• Collections Activities

• Bad Debt

• Payor Delays

• Appeals

AR Aging

71%

53%

72%

50%60%70%80%

Benchmark Comparison A/R AgingSource: PM Reports & MGMA Better Performers Survey 2008

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12%5% 3% 7%

33%

6% 5% 3%7% 5% 4%

13%

0%10%20%30%40%50%

0-30 31-60 61-90 91-120 120+

Benchmark Aug 2006 April 2008

Managed Care Contracts

• Many practices sign what

comes across the desk

• Most do not renegotiate

annually – and this hurts us ALL annually – and this hurts us ALL

• Large majority do not have fee schedules

loaded – how plans make millions…..

• You would be surprised at how many practices

have charges below fee schedules…

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Payor Report Card

Gross Collections Adjusted Collections AR Days AR 120+

% Payor Mix

Current

% Payor Mix

Prior

Period

Hassle

Factor

(A-F)

Payer 1 38% 115% 42 10% 17% 12% C

Payer 2 36% 69% 79 35% 1% 1% D

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Payer 2 36% 69% 79 35% 1% 1% D

Payer 3 29% 97% 56 22% 2% 3% D

Payer 4 51% 85% 51 18% 13% 17% C

Payer 5 32% 84% 40 9% 3% 3% C

Payer 6 18% 105% 63 8% 61% 61% B

Production and Compensation

• Perception and Reality

– I am working harder than I did last year! Benchmark Comparison

Net Charges Per Physician

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$4,261,499

$5,477,642

$4,277,944

$-

$1,000,000

$2,000,000

$3,000,000

$4,000,000

$5,000,000

$6,000,000

MGMA Estimated Total 2008 Annualized 2009

Production and Compensation

• Scheduling – Have their been changes in scheduling templates?

– Has EMR implementation impacted scheduling?

– How long until the next available appointment for a new – How long until the next available appointment for a new

patient?

– How long until the next available appointment for an

existing patient?

– What are the parameters for closing to new patients?

– How do you deal with urgent needs?

– What are the hours of availability?

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Production and Compensation

• Incentive aligned?

– Equal shares

– “eat what you kill”

– Modified “eat what you kill” – Modified “eat what you kill”

– Straight production/RVU/other methods

• The changing model- lifestyle over income

• Compensation and part time physicians

• Compensation and nearing retirement physicians

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Coding

• Since 1996 Centers for Medicare & Medicaid

Services (CMS) has implemented several

initiatives to prevent improper payments

before the claim is processed. The overall goal before the claim is processed. The overall goal

of CMS’ claim review programs are to reduce

payment error by identifying and addressing

billing error concerning coverage and coding

made by providers

• This is just the beginning…

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Coding

• May 2008 Medicare FFS Payments Report-

Shows that 3.7% of Medicare dollars paid did

not comply with one or more Medicare not comply with one or more Medicare

coverage, coding, billing or payment rules.

This equates to $10.2 billion in Medicare

overpayments and underpayments annually

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Coding

• The old and new faces of government audits:

• RAC- Recovery Audit Contractors

• CERT- Comprehensive Error Rate Testing

• Carrier/FI- Medical Records Reviews • Carrier/FI- Medical Records Reviews

• Pre-Payment Reviews- National Correct

Coding Initiatives, Medically Unlikely Events

• MICs- Medicaid Integrity Contractors

• Private Payors- Fraud and Abuse Units

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Coding

• Moving from reactive to proactive

– Your risks have increased significantly!

– Internal data audits

– Internal documentation audits – Internal documentation audits

– Internal billing audits

– Strong billing policies and procedures

– Peer review and response to offenses

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Coding

• Medicare CERT appeals

– The never ending history

– LCD issues

– Medical Necessity trumps all – Medical Necessity trumps all

– Where oh where are the records?

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Technology

• EMR and the stimulus package

– Costs versus benefits

– “meaningful use”

– True process change versus EMR dump – True process change versus EMR dump

– The real costs associated with EMR

– Moving rapidly into the second phase of utilization

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Technology

• PM Systems

– Reporting capabilities

– Reporting expertise

– Can you truly manage without data? – Can you truly manage without data?

– The Training Soapbox

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Workflow

• The copier story

• The long long walk • The long long walk

• The segregated pods

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Workflow

• The big opportunities, can you find them?

– Live the experience!

– Moving resources to the patient – pushing not

pulling pulling

– Touching things once

– Everything at my fingertips

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Motivation Guidance

• Incentive Plans

– Statistics?

– Who is included?

– How much $?– How much $?

– How often?

– Other ideas?

– The best things in life are….

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Questions to Ask….

• What are your “unexpected adjustments” and what would they represent if you could turn them into $$

• What are your most common denials? Do you know your denial rate?

• Can you verify eligibility electronically?• Can you verify eligibility electronically?

• Are your fee schedules loaded?

• How much are you collecting at TOS?

• Is your financial policy clear and provided to the patient?

• How do you handle discounted/free services? Is it consistent?

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Questions to Ask….

• Ask your staff – “How do you know if you are doing a

‘good job’?”

• How much are you recovering from your collection

agency?

• What are the most common reasons you turn things • What are the most common reasons you turn things

over to collections?

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Questions to Ask…

• Where is production today compared to this time

last year? Do I understand what is

positively/negatively impacting this?

• What is my biggest risk in a coding audit? Do my

providers really understand the rules?

• What is the best way I am using technology?

• What is my biggest challenge in technology?

• When was the last time my staff had training on the

PM system?

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Questions to Ask…

• Does our floorplan and workflow

support/improve patient satisfaction?

– Provider satisfaction?

– Limit the steps patients make? – Limit the steps patients make?

– Limit the steps staff makes?

– Provide privacy?

– Make the staff and providers more efficient?

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Questions?

Deborah Holzmark, RN, MBA, CPHQ,

MCS-P, CMPE MCS-P, CMPE

dholzmark@dixon-hughes.com

828.775.3687

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