Monthly Archives

March 2017

medical coders

Medical Coders – The Front Line of Your ASC’s Reimbursement

By | Revenue Cycle Management | No Comments

Prior to the advent of electronic claims submission – mandated by the administrative simplification portion of the Health Insurance Portability and Accountability Act of 1996 – many claims submitted by ambulatory surgery centers (ASCs) were coded by business office personnel who either relied upon information from superbills provided by surgery center providers or their own hands-on expertise.  Today, however, submitting medical claims without the benefit of professional coding expertise can negatively impact your ASC’s reimbursement.

If your ambulatory surgery center employs certified professional coders (CPCs), you’ve positioned yourself well.  However, it’s important to ensure their approach is not only outpatient driven, but ASC centric.  ASC billing is unique and has become increasingly complex with movement of high acuity cases from inpatient settings to ambulatory venues. 

Here are some ways to establish a strong team of certified professional coders for your ASC:

Hire smart.

Certified professional coders are bound by the code of ethics established by their credentialing organization. Their certification denotes implied trust.  In other words, you can assume certified coders comprehend the anatomy, physiology, and techniques used in a variety of specialties.  Insist on high levels of CPT, ICD-10, modifier, and HCPCS accuracy.  Put coders through the paces before you hire them.  Have them code sample cases (remove all PHI beforehand) that have been performed in your center and send them to an external auditor to assess coding accuracy.

Perform routine coding audits.

Gauge and manage coding accuracy by auditing often.  Internal and external audits identify educational opportunities and ensure upcoding (billing procedures beyond what is documented) and undercoding (not billing procedures supported by documentation) from plaguing your accounts receivable.

Ensure provider documentation is comprehensive.

Medical coders are not diagnosticians!  Their role is to provide the insurance carrier with a claim that accurately describes the patient/physician interaction. ASC medical coders depend on the information documented within the operative report to establish appropriate billing codes.  When medical necessity denials occur, this can be a sign that the information initially provided in the claim and supporting documentation does not adequately substantiate the billed charge(s).  Therefore, when coders approach physicians to request additional information, they are not impugning the physician’s expertise.  They are likely seeking one or more of the following: 

  • ICD-10 diagnosis codes which require a higher level of specificity and must be incorporated into the postoperative diagnosis.
  • More specific procedure headings that sufficiently support the CPT codes billed.

Coders are trained to rely on the information contained in the body of the report.   If the headings state something that is not reiterated or fully supported in the body of the report, they are not allowed to bill those codes.  To assist them in capturing all billable codes, ensure the narratives in operative reports contain the details necessary to communicate as much as possible about the encounter.

Ensure your coding team knows about new service lines you want to offer.

If your facility is thinking about expansion into new specialties or considering adding high acuity cases, provide ample notice to your coders so they can adequately prepare for these types of cases.  They will need to access additional tools to ensure the correct codes are used to describe the services provided. Further, they’ll want to research how to effectively maximize reimbursement of multiple procedures without improperly unbundling the codes.

Confirm implants will be separately reimbursed.

Forward the vendor cut sheets to your coding team as soon as you begin shopping for emerging technology or new implants.  Coders are not solely exclusive to your back-end billing process.  Involve them early and often.  They can crosscheck medical policies on the front end to prevent facility losses.  

Require your coders to routinely review carrier guidelines and familiarize themselves with payors’ reimbursement habits.

A seasoned ASC medical coder is familiar with carrier guidelines and payors’ reimbursement habits.  Third-party payor expectations are often outlined in your insurance contracts and supplemented by carrier-specific billing manuals. Require your coders to review these often.  Using the correct combination of form type and modifiers will mitigate the risk of claim denials.  Increase your output of clean claims by giving coders access to these tools early.

Make continuing education a priority.

Certified coders are required to amass a defined number of continuing education credits annually to maintain their certification designation.  Support their efforts by routinely enrolling them in courses that bolster their knowledge.  Consider allowing them to obtain specialty-specific certification.  Continuing education and familiarity with Medicare, Medicaid, and commercial medical policies can increase clean claim submissions and reduce preventable payment lags.

Certified coders are key to ensure clean claims and maximum reimbursement are generated for cases performed at your ASC.   Since the ambulatory surgery center is a niche industry, it is important to employ experienced CPCs who are willing to learn the nuances of the ASC billing process.  Collaboration between your coders, ASC leadership. and operations team, fosters an efficient claims process that will enhance profitability.


Bethany Bueno – Director of Billing Operations

ASC Materials Coordinator

Your ASC Materials Coordinator May Be Your Greatest Asset in Controlling Medical Supply Expenses

By | ASC Management | No Comments

Medical supplies are one of the most significant expenses incurred by an ambulatory surgery center (ASC).  In fact, they may run as high as 10 to 20% of your net revenue.  Your ASC materials coordinator is on the front line when it comes to controlling medical supply expenses.  The more knowledge the person who fulfills this role has regarding business operations and budget expectations, the better equipped they are to serve your facility well.

Here are seven ways to actively engage your materials coordinator:

1. Include your materials coordinator in the budget process.

Their assistance can provide you with valuable insights about what to anticipate for the coming year – annual increase expectations from vendors and potential cost savings measures, for example.  Involving them in the process early affords them an opportunity to embrace your expectations, then operate within the guidelines of the budget.

2. Ensure material coordinators maintain an up-to-date item master.

Updating your item master is an ongoing process.  When new supplies are added, ask your materials coordinator to ensure they aren’t duplicating previous entries.  Have them compare the item pricing with the order confirmation and/or invoice to verify the most current price is loaded in your inventory system.  Set an expectation for consistency in nomenclature to assist with item searches and reporting.  Provide a big picture perspective – a clean, up-to-date item master provides accurate case costing reports necessary to make sound business decisions.

3. Utilize just-in-time inventory.

Ask your materials coordinator to limit stock items on your storage shelves to basics and items that can only be ordered as a case unit.  Have them check with your distributor to determine which items are sold individually.  To effectively handle order or delivery delays, plan on keeping several days of inventory for fast-moving items on hand.  Order enough supplies to cover procedures until the next delivery date but avoid overstocking your shelves.  While overstocking may meet a materials coordinator’s desire to reduce time spent placing and receiving orders, it creates an unnecessary increase in expenses that doesn’t directly correlate to case volumes.  Again, providing the big picture perspective to your materials coordinator can create buy-in to just-in time inventory methods.

4. Involve material coordinators in your preference card process.

Consider allowing them full access to physicians’ preference cards including permission to change items reflected there.  If you are uncomfortable with this, ensure they have access to a clinician authorized to make those changes on the material coordinator’s behalf.  This access ensures preference cards are updated when ‘old’ items are replaced with ‘new’ items.  Up-to-date preference cards assist your clinical team to efficiently pick supplies for the facility’s cases.

5. Provide education to your materials coordinator on payer contracts, especially those that reimburse for implants separately.

Because materials coordinators are responsible for ordering implants, they need to understand when implants are included in your facility’s procedure reimbursement and when they are reimbursed separately.  Creating a ‘cheat’ sheet of payers with implant reimbursement information can help guide them in their purchasing process.  Armed with this information, your materials coordinator can assist with surgeon education on the cost of implants and payer reimbursement.

6. Ensure your materials coordinator has a refined process for receiving and invoicing supplies.

Having the following process for your materials coordinator will provide inventory control and accurate financials –

  • Enter receipt of supplies from packing slip into inventory module.
  • Review the invoice against the purchase order (PO) and packing slip to confirm receipt of invoiced products.
  • Compare invoice pricing to the facility’s inventory item master.
  • Code the invoice for accounting.
  • Input the invoice number into the inventory or patient accounting system.
  • Close the PO once all items are received and invoiced.
  • If your facility prepares financial statements based on accrual accounting, provide an open PO accrual log report to your accountant at the end of each month. Doing so will ensure the current month’s supply costs are accrued for with the current month’s revenue and expenses.  This also helps your materials coordinator stay on top of open invoices.  Having this list provides your materials coordinator an opportunity to call vendors to request delayed invoices thereby avoiding late payment fees or account holds. 

7. Have your materials coordinator perform an annual physical count at year-end.

If inventory has been managed properly during the year, and there have been no significant changes in your business, the inventory adjustment from the previous year should be minimal.  If specialties were added, there may be an increase in on-hand inventory to cover supplies purchased for the new specialty.

Involving your materials coordinator in the ASC’s business operations and budgeting processes could contribute significantly to your center’s bottom line. The key is to provide them with clear expectations and explain how their daily activities impact your vision for the upcoming year.  Then, empower them to make decisions that positively impact your surgery center’s finances.  


Kelli McMahan – Vice President of Operations

High Deductible Health Plan Members

When is a Self-Pay Arrangement a Good Prescription for High Deductible Health Plan Members?

By | Payor Contracting | No Comments

Recently I was asked what ASCs could do to assist patients who can’t afford to pay for a procedure that’s covered under their high deductible health plan (HDHP).  If you haven’t faced this question yet, brace yourself!  The findings of the Kaiser Foundation and Health Research and Education Trust’s 2016 Annual Survey suggest you will soon.

Kaiser’s survey indicates four out of five patients who arrive in your facility are likely covered by a high deductible plan.  It further reveals that deductibles on employer sponsored health insurance policies rose 12% in 2016.  This is four times faster than premiums increased.  The average deductible for single coverage is almost $1,500 with many plans exceeding that amount.  Since 150 million Americans have coverage through their employers, expect to see patients with high deductibles more often.[1]  

I negotiated a contract with a payor on behalf of a client and was pleased the end result was exceptional reimbursement for the ASC.  However, one of the facility’s surgeons was approached by a patient who had insurance with that payor.  To my surprise, the surgeon was not as impressed with the reimbursement as I was.  He was concerned the payor’s contract made the ASC cost-prohibitive for his HDHP patients.  Talk about unintended consequences!  

Since I contributed to creating the problem, I had a stake in finding ways to minimize the adverse effects for the ASC and its patients.  One way was to educate patients on their right to opt-out of insurance and create a self-pay arrangement.  If you are wondering if your ASC and its patients could benefit from a self-pay arrangement, consider the following:

  • What limitations does your ASC need to be aware of prior to pursuing this route?
  • When can your ASC recommend to a patient that it may make sense for them to opt-out and enter into a self-pay arrangement?

What limitations does your ASC need to be aware of?

Review your contracts to determine which ones call for direct billing.  Most, if not all, contracts with insurance companies require providers to directly bill the insurer for covered services provided to their members.  

Federal regulations now allow patients covered by health plans the right to opt-out (typically for privacy reasons).  As Wall Street Journal clarifies: “Cash prices are officially aimed at the uninsured, but people with coverage aren’t legally required to use it.”[2]  If they opt-out, they choose to pay a provider in full on or before the day of surgery and relinquish the privilege of the provider billing the insurance company on their behalf.  

Some precautionary measures your ASC should be aware of include:  

  • Does your contract have a “most favored nation (MFN)” clause?  A MFN clause essentially restricts your ASC from accepting lower payment for a service from anyone other than the payor that mandated the clause.  In other words, your discounted rate for self-pay patients cannot be lower than what the insurer with the MFN status pays your ASC.  Fortunately, MFN clauses are not common these days.  But if they’re overlooked, this condition could present a problem if you deeply discount ASC fees for self-pay patients.      
  • Your patients need to be informed they can’t avoid paying their deductible under their HDHP. If the patient opts to seek care under a self-pay arrangement, an insurance claim will not be filed.  This means the amount they remit under the self-pay arrangements is not credited to (applied against) their deductible.      
  • Once a patient opts out of insurance, they cannot expect the ASC to bill the insurance company at a later date. By that point, it is likely the claim would be outside of timely filing requirements and subject to denial.

The primary message is “do your homework.”  This starts with knowing the terms in each of your insurance contracts and, when necessary, seeking legal opinion about your options.  Further, find out if there are laws in your state that override federal regulation.  Typically, the most restrictive laws will dictate your self-pay pricing.

When can your ASC recommend a self-pay option?

It makes sense for a patient to elect self-pay when:

  • The patient expects to be responsible for paying the ASC the full amount due under their HDHP.
  • The patient’s deductible is high and their health is such they do not anticipate reaching their deductible during their plan year.
  • The amount the patient will pay under your ASC’s self-pay policy will be substantially less than they would owe if you submitted the claim under their HDHP. Remember to take into consideration the contracted rate (allowable), not merely the fee you bill to the payor.  
  • The patient is able to pay for services in full, via cash or cashier’s check, on or before the day of surgery.
  • The patient is willing to sign a form electing to opt-out of insurance and enter into a self-pay arrangement.
  • The patient, for privacy reasons, wishes to withhold releasing their medical records to their insurance carrier.

Ensure patients who opt-out, specifically sign an “election to opt-out of insurance” clause on your self-pay form.  

By acknowledging this clause, the patient is stating they understand:

  • They have chosen to opt-out of their insurance.
  • Your ASC will not be filing a claim with their insurance company.
  • If the patient were to file a claim on their own, there is no guarantee it will apply towards their deductible. This is because the patient chose not to use insurance.

At the time of scheduling, it can be difficult to predict all the procedures that will be performed when the surgery actually takes place.  For that reason, add a disclaimer to the election form alerting the patient to the possibility of an alternate procedure and/or additional procedures being performed. Ensure they accept responsibility for paying the difference between the quoted price and the actual price after the “time of service” discount is applied.

Also, it is important to clarify upfront that receiving the discounted self-pay price is contingent upon payment being made on or before the date of service via cash, money order, or cashier’s check.   If your ASC opts to accept payment from the self-pay patient via credit card, consider adding a 3% credit card processing fee to your cash price.  Doing so will incentivize self-pay patients to pay with cash, money order, or a cashier’s check.

Finally, your ASC should not send any claims to the carrier for the opt-out episode of care, nor provide a claim form to the patient for claim filing purposes. Instead, incorporate all charge and payment information into the opt-out self-pay election form.  This precautionary measure may deter opt-out self-pay patients from sending a claim to their insurance company.   


Dan Connolly – Vice President of Payor Relations and Contracting

[1] The Kaiser Family Foundation and Health Research & Education Trust. “Employer Health Benefits,” 2016      

[2] “How to Cut Your Health-Care Bill – Pay Cash,” The Wall Street Journal, February 2017

 

Changing Banks

Time for Your ASC to Consider Changing Banks? What You Need to Know

By | ASC Governance, ASC Management | No Comments

The threat of rising interest rates in the banking industry came to fruition in November 2016.  If your ASC has not taken advantage of refinancing its debt at a lower rate, your days to do so may be numbered.  Unfortunately, if the refinancing of your outstanding notes also includes a change in bank relationships, significant forethought is required to ensure the process does not negatively impact your business operations.

It is best to use a team approach to manage this process.  Team members could include administration, revenue cycle management, managed care, accounting, accounts payable, materials management, and human resources.  The process may take several months to manage safely and effectively, so plan accordingly.

First, have your team identify all aspects of your business that changing banks will impact.  Here are some areas to consider:

Accounting, Accounts Payable, & Materials Management

  • Transfer of deposits between accounts and/or lockbox
  • Current bank credit card
  • New bank credit card
  • Automatic lease payments
  • Online banking fees
  • Automatic vendor payments

Human Resources

  • Payroll
  • 401(k) withdrawals
  • HSA withdrawals
  • Automatic employee benefit provider payments

Revenue Cycle & Managed Care

  • Electronic fund transfer (EFT) payments
  • Lockbox
  • Online bill pay
  • Merchant services accounts

Next, delegate responsibilities to team members for each aspect of your business.  Responsibility and delineation of duties may look something like this:

Administration

Administration may be the best department in your organization to oversee the process.  Arrange bi-weekly calls with all stakeholders to enhance communication.  Have an agenda with specific items to accomplish before the next meeting to maintain project organization and oversight.  Prepare owners for potential disruption in cash flow. Discuss precautions, such as keeping extra cash on hand, to proactively manage worst case scenarios. 

Managed Care

Coordinate a strategy with revenue cycle management to communicate with payers about the change in payment remittance.  It may not be in your best interest to notify all payers at once that you have changed banks.  Stagger payer notifications.  When funds begin to flow through the new account from a given payer, proceed with notifying the next payer.

In advance of changing banks, and based on the schedule developed in conjunction with revenue cycle management, begin notifying key commercial payers via email the ASC’s plan to change the lockbox or EFT address.  Provide the following information based on the contract requirements:

  • The old remittance address
  • The new remittance address
  • The effective date of change – build in a 10-14 day delay between the notice and effective date
  • An updated W-9
  • Submit all information on your ASC’s letterhead as an attachment to your email notification

After you have received confirmation from each commercial payer that the new lockbox or EFT address has been loaded into their system, ask your revenue cycle management team to recommence billing.  At that time, you can begin dropping claims reflecting the new remittance address.

Revenue Cycle Management

Work with your managed care representative to develop a schedule for notifying payers of the change in bank.  Once you gain user access to the new bank account, confirm it meets your needs to perform associated collections activities.

If using a lockbox, determine the size required.  Obtain the new lockbox address.  Complete the lockbox application form, selecting documentation delivery and storage options that meet your needs.  Then, complete the automated clearing house (ACH) transfer form with your facility’s online payment vendor.

 Once you receive the new lockbox address:

  • Update the lockbox address in your patient accounting system.
  • Change the lockbox address on your electronic and/or paper statements.
  • Complete a forwarding order with the US Postal Service to the new lockbox address.
  • Obtain a copy of a voided check required to complete many EFT change forms.
  • Review current EFT payers and timing (effective date) of EFT changes.
  • Complete third-party payer applications online and via paper.
  • Monitor both accounts to confirm when EFT changes become active in the new account.
  • For payers who are not delivering payments via EFT direct deposit, complete a W-9 form and send to them with a request to correct your remittance address in their system.
  • Monitor both accounts to confirm EFTs, credit card deposits, and all other payments are moving from the old account into the new account.
  • Ensure lockbox activity at the previous bank ceases.
  • Apply for a merchant account with your new bank. Review your merchant account contract to determine how to terminate merchant services at your old bank.  Then, terminate services with the old bank to ensure credit card payments are deposited in your new account.

Human Resources

Have human resources determine which employee benefits are directly linked to your current bank account.  Armed with this information, schedule transfer of funds to your new account.  The list may include, but not be limited to, payroll disbursements, 401(k) contributions, medical/dental/vision insurance premiums, health savings and flexible spending account transactions.

Accounting, Accounts Payable & Materials Management

Accounts payable and materials management must collaborate with accounting and administration to verify bills are paid from the proper account and the account has sufficient funds.  Ensure autopay accounts are updated to reflect the new bank account information.  If a bank credit card is in use at the facility, coordinate a schedule for terminating the old card and activating the new card. 

Keep in mind your old bank account will likely remain open for six months or longer while all required transfers take place.  Bank fees will continue to be charged until the account is closed. However, following the process outlined above will assist you in timely closure of the old account and reduction in associated bank fees.

There are many reasons your ASC may find itself in a position to change bank accounts.  Managing the process for your center with forethought will not only reduce disruption to stakeholders but ensure the advantages of doing so are clear to everyone.


Pinnacle III Leadership Team

Convalescent Care Center

Value Proposition: Adding a Convalescent Care Center to Your ASC

By | ASC Development, ASC Governance, ASC Management, Leadership | 2 Comments

If your ASC operates in a state that allows convalescent care centers, there are numerous benefits of adding one to your existing continuum of care.  We outline some of those benefits in this value proposition.  

Convalescent Center Value Proposition

In some states, an ASC may maintain a separately licensed convalescent care center as part of its service offering.  This separate licensure provides an ASC with the opportunity to keep most commercial patients beyond the standard 23-hour stay of a regularly licensed ASC.  The extended stay is granted for observation and pain control for more extensive outpatient procedures.  

The ASC is generally directly compensated for the additional recovery time in the convalescent center.  Compensation occurs in a variety of ways including hourly rates, per day rates, or increased consideration in global or bundled fee arrangements.  In addition, the ASC may be indirectly compensated by securing greater reimbursement from commercial payers on lower acuity cases.  This is because payors recognize cost savings occur when higher acuity cases safely move from a hospital to an ASC with extended stay capability.  

The primary advantage for an ASC with a licensed convalescent center is the potential to provide services to higher acuity surgical patients.  Orthopaedics and neurosurgery specialties benefit most from this advantage, specifically in total joint replacement and spinal surgery.

The types of orthopaedic cases requiring extended stay that are well-suited for an ASC connected to a convalescent care center are: 

  • Patella femoral arthroplasty
  • Total hip arthroplasty
  • Total knee arthroplasty
  • Total shoulder arthroplasty
  • Total ankle arthroplasty

These cases traditionally restricted both physicians and patients to an inpatient setting.  Although moving them to an outpatient setting represents significant savings for insurance carriers and patients alike, these higher acuity cases can provide a net revenue per case increase of 300-400% over traditional ASC orthopaedic cases.

Other types of extended stay cases well-suited for this arrangement are orthopaedic-spine and neuro-spine.  Specifically, the following:

  • Single and multi-level anterior and/or posterior cervical and lumbar fusions
  • Cervical and lumbar disc arthroplasty

Again, these spine cases may have traditionally restricted physicians and patients to inpatient settings.   Cost-savings for both insurance carriers and patients also occur when these cases move to ASCs with separately licensed convalescent centers.  The result for ASCs can be a net revenue per case increase of 600-700% over traditional orthopaedic cases and 250% above traditional spine cases.

Another advantage of these separately licensed facilities over inpatient hospitals and orthopaedic specialty hospitals occurs in payor contracting.  The value proposition for commercial payors, workers’ compensation, auto insurers, and the general public is significant.  A contracting advantage for surgeons in terms of future health care reimbursement may also be realized.  Future reimbursement will likely include, but not be limited to:  bundled payments, pay-for-performance, at risk contracting, clinically integrated networks, consumer-driven care, and price transparency.

Finally, having the capacity to accommodate higher acuity and higher paying surgical cases enhances surgeon and partner recruitment. With the saturation of “commodity” ASCs, an ASC with an adjoining convalescent care center offers the benefits of a mini-hospital. This is attractive to surgeons who may not otherwise be interested in using your facility, much less investing in it. 

What Value Does a Convalescent Center Represent for You?

Investigating convalescent care center licensure requirements in your state is a worthwhile endeavor if your facility is interested in performing higher acuity cases.  If your state allows these types of centers, conduct a thorough cost-benefit analysis to determine the feasibility of establishing one in conjunction with your ASC. 

If your state does not currently afford ASCs the opportunity to establish an adjoining convalescent center, consider these benefits, network with other facilities, then work together to rally legislative support for them in your locale.


Pinnacle III Leadership Team

Patient Payment Policies

Are Your ASC’s Patient Payment Policies Hindering Effective Collections?

By | Revenue Cycle Management | No Comments

According to a recent study by Kaiser Family Foundation, an increasing number of insured Americans report difficulty affording health care.[1]  Are you prepared for the impact your patients’ out-of-pocket costs will have on your facility’s cash flow?   Implementing patient payment policies and corresponding processes goes a long way toward effectively managing a growing financial class – patient responsibility.    

Are you familiar with your ASC’s patient payment policies?  Is your board supportive of those policies?  Does your staff follow the policies?  If you answered “no” to any of these questions, there’s work to be done.  Make sure you tighten the gaps.  Educate and train your staff on how to implement the policies effectively.  Your efforts will be instrumental in avoiding an increase in bad debt due to uncollected account balances.  You will also create a better patient experience with your ASC’s billing process.

Let’s review the components of strong patient payments policies and upfront collections.

Creating an effective collections process starts with determining when you need to receive payment from patients.  Best practice is to collect co-payment and deductible portions owed by patients before or on the date of service.  Post your policy at your front desk and in your waiting room.  For patients who do not have insurance (self-pay), secure payment in full on or before the date of service. 

Do your patient payment policies outline what should occur when patients indicate they are unable to meet the terms of those policies?  If so, what steps need to be taken by facility personnel?  Proactively discuss with your facility’s governing board the types of payment plans they are willing to extend to patients.  Furthermore, decide what mechanisms the ASC will use when individual patient payment needs conflict with established policies. 

Other things you can do to ensure successful upfront collections include:

  • Providing patients with an accurate estimate of their responsibility for upcoming care – review these details with them before their date of service.
  • Relaying the types of payment you accept – cash, credit cards, automatic withdrawal from bank accounts, online bill pay portal, etc.   Provide as many payment avenues as possible and make it easy for patients to pay.
  • Developing a well-defined policy for upfront collections. Statistics reveal patients are 90% likely to pay before their visit, 70% likely at checkout, and only 40% likely to pay after their visit.[2]
  • Training your staff to be comfortable with upfront collections – provide collections scripts, customer service training, and role playing opportunities to enhance their skills.

Before finalizing your policies, establish how you will deal with amounts that are billed to but not covered by insurance and are attributed to patient responsibility by third-party payors.  

Some questions to consider are:

  • How long will you wait for the insurance payment before you involve or bill the patient?
  • Will you bill secondary insurance?
  • Will you bill the secondary policy if this information is provided after you billed your patient?

Determine if you will bill exclusively when the secondary policy is submitted at the time of registration. Look at your statement cycle – statements issued once a month are no longer effective.  Consider the frequency of your statements and the number of statements you will send before referring patient accounts to an outside collections agency.

After determining your upfront collections policies, define what past due means for your ASC.  It’s surprising how many patient payment policies state past due accounts will be turned over to an outside collections service but do not adequately define the term past due.  Is it one day past the due date?  Is it ten days after the due date?  If you state accounts will be turned over to collections, follow through.    Establish a policy on how to handle scheduling of patients who were previously turned over to collections. 

Consider the following:

  • Will you collect all amounts owed from past dates of service before scheduling an upcoming case?
  • Will you collect the patient estimate in full with no payment options due to previous collections activity?

To address the questions above, consider a legal review of your policies.  This will confirm you have thoughtfully dealt with necessary items and considered how to handle any problems that may arise. 

Once you have a refined policy in place, post it in your waiting room and on your website.  Also, include it in your patient packets and review it in person with patients and family members.  Have patients sign the policy and any corresponding payment plan agreements, then provide them with a copy. Lastly, send the agreement to your billing department to assist with collection efforts.  Displaying and consistently following your patient payment policies will lead to better outcomes in your upfront collections. 

In these times of rising out-of-pocket health care costs, your ASC’s patient payment policies and upfront collections practices are important to the well-being of your ASC.  Review them frequently to ensure your upfront collections practices lead to an enhanced billing experience for patients and stabilization of your ASC’s revenue.


Carol Ciluffo – Vice President of Revenue Cycle Management

[1] The Henry J. Kaiser Family Foundation: “Data Note:  Americans’ Challenges with Health Care Costs,” 2017 

[2] McKinsey & Company: “U.S. Health Care Payments: Remedies for an Ailing System,” 2009

ASC Trends

New White Paper! Looking Ahead: 10 ASC Trends and Developments to Watch in 2017

By | ASC Development, ASC Governance, ASC Management, Leadership, Payor Contracting, Revenue Cycle Management | No Comments

We are excited to release our latest white paper – 10 ASC Trends and Developments to Watch in 2017.

We are still in the early months of 2017, but it is already shaping up to be an interesting year in health care — one that is likely to be a mix of uncertainties, challenges, and opportunities.

Fortunately for ASCs, they are well-positioned to thrive in the rapidly changing and evolving marketplace.  They may even be able to improve their position by planning for and effectively responding to trends and developments.

The 2017 trends and developments for ASCs identified by our leadership team include a forecast for strong industry growth, interest in adding new specialties, and continued migration of higher acuity cases to ASCs.

Changes in the relationship between ASCs and payors are impacting reimbursement especially in facilities who do not have strong revenue cycle management solutions.  Bundled payment programs and the growing number of self-insured employers continue to create marketing opportunities.

Unfortunately, the continued escalation of the financial responsibility borne by patients present revenue challenges.  And, a rise in cyberattacks has disrupted health care, bringing cybersecurity to the provider forefront.

Finally, educating patients, physicians, health systems, and payors on the value of ASCs remains a top priority. Raising this awareness is crucial to fuel the growth the ASC industry is primed to experience in 2017.

In summarizing what’s ahead in 2017 for ASCs, Trista Sandoval, our Director of Business Development & Physician Relations, said:

“One of our main strategies is to continue to focus on raising awareness of ASCs as a high-quality, low-cost option for care, and doing what we can to drive applicable outpatient cases to our ASCs. That may take the form of helping hospital systems build their own ASCs, educating patients through direct consumer marketing, or reaching out to physicians to build awareness of the ASC setting as a viable option for their procedures.”

Through such efforts, Pinnacle III’s leadership team believe ASCs will thrive in 2017.

To read the full report, download the white paper here: https://www.pinnacleiii.com/white-papers/ 


The Pinnacle III Marketing Team

ASC Medical Equipment

Purchasing ASC Medical Equipment Doesn’t Have to Be a Pain

By | ASC Development, ASC Management | 2 Comments

Purchasing medical equipment for a new surgery center or adding new equipment to your existing ASC can be daunting.  With forethought, however, the task is manageable and can be downright rewarding.  Here are some important considerations to keep in mind.

1. Buy only what you need.

How do you know you what you need?  Communication with your surgeons is key.  Review their preference cards.  Understand the kinds of cases they perform.  Discuss their equipment model and vendor preferences.  This information will arm you to shop wisely and negotiate well. 

If you’re in an existing center and a physician requests new equipment, identify what prompted the request.  Gather information on how the equipment will improve patient care.  Determine if new volume will be generated and understand what types of cases will be served by the equipment.   Calculate the anticipated return on investment.  If you need the equipment for rarely performed cases and it will take five years to recoup the investment, it may make sense to defer the purchase until the situation changes.

2. Negotiate.

It may not be in your ASC’s best interest to accept the first price a vendor provides.   Determine if you have opportunities for discounts based on aggregated purchases.  Is GPO pricing available?  Are there demo models on hand to purchase?  Is there package pricing based on the number of disposables you purchase from the vendor? 

Don’t be afraid to shop around to see if other vendors offer better pricing.  While your surgeon may be partial to a specific vendor, they may be willing to switch to an alternate vendor if cost savings can be realized.   

Be willing to look at refurbished equipment, especially for your workhorse items.  Once refurbished, these items can last another ten years.  Work with reputable refurbishment vendors when considering this option. 

You can also check for used equipment online.  Craigslist and eBay often have great pieces of equipment available.  Sometimes, the price you pay may be worth the additional risk you assume by shopping for these items online.

3. Trial new equipment.

There is an abundance of new technology on the market right now.  Ask your vendors to bring in new equipment for a trial period.  This will allow surgeons to test the equipment to determine if it meets their needs and provides the highest quality of care to their patients. 

It’s important to have facility staff involved in setting up the equipment.  This allows them to familiarize themselves with the equipment prior to its purchase. During the equipment trial, ask the following questions.  What effect does the equipment have on turnover times?  Does it provide any efficiencies?  The answers will aid in your purchasing decision.

4. Review warranty and service contracts.

If the equipment breaks, is it fully replaceable?  Does the vendor provide loaners to meet the facility’s needs while the equipment is out for service?  Does the warranty cover the first year of service?  Does receiving service from an outside vendor void the warranty?  These are all important questions to consider prior to the purchase.

5. Lease, finance, or pay cash?

When considering how to pay for your equipment, determine the life of the equipment.  What is your cash on hand? How much interest will you pay for the lease or loan?  What are the buyout terms at the end of the lease?  Consider both the short- and long-term impact of the purchase.

6. Delivery and installation.

Often, little thought is given to the delivery and installation of the equipment.  The size of your capital purchase dictates how and where delivery occurs.  If you have a loading dock at your center, indicate that on the purchase order.  If you don’t have a loading dock, ensure you specify the need for a liftgate.  You may think whoever is delivering your equipment will bring it inside and place it where you like.  This is not always the case.  If you need inside delivery and placement of your equipment, indicate this on your purchase order so the vendor can provide this information to the delivery company. 

Another consideration is the unpacking and disposal of delivery pallets.  Sometimes the equipment is delivered encased in pallets.  If you require disposal of this material, let the vendor know.  It is often necessary or helpful to ask your vendor to unpack the equipment for you.  This helps prevent any damage to the equipment and identify issues that may have occurred during transit.

7. User Competency.

To ensure employee competency with new equipment, schedule an in-service demo for your staff with the vendor representative.  Develop a competency document that employees sign-off on indicating they understand the correct use and function of the equipment.  Retain these documents in employees’ personnel files.

Making capital purchases is a vital step in your surgery center’s development. Optimize this process to address the ongoing maintenance and long-term sustainability of your facility.  Once you understand the nuances and address the considerations noted above, the process is easier to navigate successfully.


Lisa Austin – Vice President of Facility Development

CMS Emergency Preparedness Rule

What the CMS Emergency Preparedness Rule Means for ASCs

By | ASC Management | No Comments

The Final Rule outlining Emergency Preparedness Requirements for Medicare and Medicaid Participating Providers and Suppliers became effective November 15, 2016.  Ambulatory surgery centers (ASCs) are one of 17 providers and supplier types that must comply with and implement all regulations by November 15, 2017.  The purpose of the 186 page rule is to institute national emergency preparedness requirements and increase patient safety during emergencies.  It also establishes a more coordinated response to natural, technological, and human-caused disasters.

ASCs are required to meet the following four core elements for conditions of participation.  There is a fifth element applicable for integrated ASC health systems who elect to participate in a coordinated emergency management program.

Establishing and maintaining an emergency preparedness program that meets the requirements outlined in the rule, include but are not limited to, the following elements:

1. Develop and maintain an Emergency Management/Operations Plan. Review and update annually. The plan must:

a. Be based on and include a documented facility and community-based risk assessment using an all hazards approach.

b. Include strategies for addressing emergency events identified by the risk assessment.

c. Address patient populations served by the plan. This includes, but is not limited to, the type of services the ASC can provide in an emergency and continuity of operations such as delegation of authority and succession plans.

d. Include a process for cooperation and collaboration with local, tribal, regional, state and federal emergency preparedness officials’ efforts to maintain an integrated response during a disaster/emergency. Integration includes documentation of the ASC’s efforts to contact such officials and its participation in collaborative planning efforts.

2. Establish corresponding policies and procedures.

a. Must be based on the emergency plan, risk assessment, and communication plan.

b. Must be reviewed and updated at least annually.

c. Must minimally address the following elements: tracking sheltered or relocated patients and on-duty staff during an emergency, evacuation from the ASC, a means for sheltering in place, a system of medical documentation, the use of volunteers and other staffing strategies, and the role of the ASC in the provision of care and treatment as an alternate care site.

d. Additional specific requirements pertaining to policies and procedures are available in the Federal Register, Vol. 81, No. 180.[1]

3. Communications Plan

a. Must comply with federal and state laws. It needs to be reviewed and updated at least annually and include the seven elements outlined in the rule.  For more information on the seven elements, refer to page 165 via the hyperlink referenced below.

4. Training and Exercise Program

a. Develop a training program based on the emergency plan, risk assessment, policies and procedures, and communication plan. This should include initial and ongoing training on policies and procedures. Your training program should be reviewed and updated at least annually.

b. Maintain documentation of all emergency preparedness training and demonstrate staff knowledge of emergency procedures.

c. Conduct at least two exercises annually. One should be a community-based full scale exercise if possible. The other should be a facility-based full scale or table top exercise.

d. Develop a documented after action report and improvement plan. Implement improvement items identified and maintain documentation of same.

5. Integrated Health Care Systems

a. ASCs in a system containing multiple separately certified health care facilities that elect to have a unified and integrated emergency preparedness program must meet the five elements outlined in the Integrated Health Care Systems section of the rule.

Accreditation Status:

A facility’s accreditation status is a significant factor in determining the burden to an ASC in terms of both the workload and the associated costs required to meet the new CMS requirements.  The final rule calculates anticipated burden hours and cost estimates for each of the four core elements based on accreditation status.  ASCs accredited by the American Osteopathic Association/Healthcare Facilities Accreditation Program (AOA/HFAP) and American Association for Accreditation of Ambulatory Surgery Facilities (AAAASF) currently have minimal emergency preparedness requirements. Therefore, their anticipated burden is higher.  The Joint Commission (TJC) and the Accreditation Association for Ambulatory Health Care (AAAHC) accreditation standards contain more extensive emergency preparedness requirements. Although ASCs with TJC or AAAHC accreditation will likely incur some work to meet the requirements, their anticipated burden is lower than AOR/HFAP and AAAASF accredited facilities.

What are the next steps for your ASC?

  1. Review the section of the Final Rule that pertains to ASCs on pages 77-82 by clicking on the following link: https://www.gpo.gov/fdsys/pkg/FR-2016-09-16/pdf/2016-21404.pdf
  2. Schedule an initial meeting to start work on performing a thorough risk assessment (also known as a Hazard Vulnerability Analysis or HVA).
  3. Complete a gap analysis by cross-walking your existing Emergency Management Program with the final CMS rule to identify areas that do not meet the requirements. Your existing Emergency Management Program should include your Emergency Management/Operations Plan, response plans, policies and procedures, as well as your training and exercise program.
  4. Develop relationships with other ASCs and share your work with one another.
  5. Find local and national resources for the Final Rule at cms.gov.
  6. Take advantage of technical resources which can be found at https://asprtracie.hhs.gov/technical-resources. Click on “CMS Emergency Preparedness Rule: Resources at Your Fingertips” and refer to pages 15-16 for plans, tools, templates, and links to other resources.     
  7. Develop a relationship with your local hospital(s), public health agency, and the Office of Emergency Management. This may be accomplished directly and/or through your regional Health Care Coalition.
  8. Health Care Coalitions are currently evolving in Colorado. Contact your local Hospital Emergency Preparedness Coordinator, Local Public Health Agency, or Office of Emergency Management to determine how to get involved in your designated coalition.[2]

Julie Zangari – Emergency Preparedness Coordinator of Peak One Surgery Center

Michaela Halcomb – Administrator of Peak One Surgery Center 

[1] https://www.gpo.gov/fdsys/pkg/FR-2016-09-16/pdf/2016-21404.pdf

[2] A Health Care Coalition resource specific to Colorado is:  https://www.colorado.gov/pacific/cdphe/health-care-coalitions