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Revenue Cycle Management Archives - Page 2 of 2 - Pinnacle III

Mar 30
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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

Mar 14
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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

Feb 24
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ASC Revenue Cycle

Assessing the Health of Your ASC’s Revenue Cycle through Benchmarking

By Revenue Cycle Management No Comments

Carol Ciluffo, Vice President of Revenue Cycle Management for Pinnacle III, is featured in an ASC Focus column. ASC Focus is the official magazine of the Ambulatory Surgery Center Association.

The article, titled “Benchmark Your Revenue Cycle,” is published in the February 2017 issue.

Carol discusses the following topics in the column: the importance of monitoring revenue cycle health, various benchmarks ASCs can consider tracking, how benchmarking can identify opportunities for improvement, and the need to embrace benchmarking results.

To access the article, click here (ASCA membership required).

For more ASC revenue cycle management best practices, please visit some of Carol’s original posts in our blog:

Benefits Approval in ASCs: Pre-Authorization & Pre-Determination Vastly Differ

Billing Solutions: Forensic Collections – Lost Revenue Found

Put the “Revenue” in Revenue Cycle Management from Your Most Important Source: Your Patients

To Audit or Not to Audit – That is the Question

Implant and Supply Reimbursement Blunders Nearly Every ASC Commits

Feb 22
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Lockbox Banking

Is Lockbox Banking Right for Your ASC?

By Revenue Cycle Management No Comments

Do you receive payments in the mail from your patients?  Are these payments deposited the same day they are received?  Do you have enough staff on hand to properly process these receipts and adhere to best cash handling practices?  How much time does it take your staff to file or scan the payment documentation that needs to be retained?  If you are struggling with any of these issues, lockbox banking may be a benefit to you.

Lockbox banking is a process in which patients submit payments to a special post office box instead of to your ASC.  Your bank has couriers pick up mail from that box and deliver it to them.  Bank personnel open the mail, scan, and deposit the payments directly into your bank account.  You obtain earlier access to your money and are provided payment information in an electronic format.  These paperless files are then used to post information to your patient’s accounts.

There are pros and cons to consider before proceeding with a process change.  Here is a list of advantages and disadvantages that may help you determine if this payment processing strategy is right for you.

Advantages:

  • Earlier access to your money (typically one to three days)
  • Streamlined payment processing
  • Payments retrieved directly by the bank, reducing possibility of office theft
  • Bank scans all documentation directly into your account
  • Customized remittance processing designed to meet your needs
  • An evolving service that adopts new, improved imaging technology
  • Lockbox location can be chosen close to your facility to shorten mail and receipt time
  • Frees up office resources to handle other tasks

Disadvantages:

  • Service fees
  • Quality of training and supervision of lockbox bank employees

How do you decide if lockbox processing is right for your office?

  • Perform a time study on your in-house payment process and the associated process costs (staff, supplies, check scanners, mileage/liability for in-person deposit deliveries).
  • Quantify the number of payments and associated payment documentation you receive.
  • Calculate the value of your average payment received via mail.
  • Compare the costs of your current in-house process to your lockbox processing option.
  • Determine if the fee is negotiable.
  • A high volume of small payments may not be worth the cost.
  • Compare the cost of the service to the benefit of earlier access to funds.
  • Confirm the bank’s security policies to guard against the potential for theft internally and by third party courier vendors.

By performing due diligence, you will be able to determine if lockbox bank processing will create efficiencies in your front office and safeguard vulnerable ASC receivables.  This includes freeing up valuable staff resources, eliminating manual processes, and tightening security of the payment receipts.  At the very least, it is worth exploring the opportunity.

Carol Ciluffo – Vice President of Revenue Cycle Management

Feb 02
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Benefits Approval

Benefits Approval in ASCs: Pre-Authorization & Pre-Determination Vastly Differ

By Revenue Cycle Management No Comments

Understanding the difference between pre-authorization and pre-determination of patient benefits is valuable knowledge for ASC front office personnel to possess.  These distinct approval processes are easy to confuse, leading to improper documentation prior to patients receiving health care services.  As a result, claims for services performed get delayed or, worse, outright denied.  Understanding the definitions of these approval processes allows ASC personnel to accurately determine the proper course of action prior to commencing patient care. 

Pre-Authorization

Pre-authorization is a required process.  It determines a patient’s benefits coverage and secures authorization and/or approval from a payor for a proposed procedure before the patient receives the desired care.  

Pre-authorization does not guarantee reimbursement of the services that will be performed.  However, it provides important information regarding a patient’s unique benefits including their eligibility status and potential out-of-pocket expenses.  Not obtaining authorization prior to rendering treatment could result in non-reimbursement by the payor.  

Once authorization is complete, an authorization number is issued.  Adding the authorization number to the claim upon submission is a vital step to avoid unnecessary denials.  In circumstances where a claim is denied based upon lack of medical necessity, having an authorization number bolsters the contents of a provider’s appeal letter.

Pre-Determination

Pre-determination is a process that allows a provider to seek approval from the insurer for proposed services or treatment based upon medical necessity.  It is recommended when the planned procedure is considered experimental, investigational, or cosmetic.  Consult your carrier’s medical policies to identify services that fall into these categories.  It is also wise to obtain pre-determination forms (or letter requirements) from specific carriers to ensure you properly submit the information required to conduct their review. 

The insurer’s medical staff evaluate the pre-determination request against the carrier’s medical policies to determine whether the proposed procedure should be approved or denied.  Approvals and denials, in the form of a letter, are sent to the patient and health care provider(s).  This letter should be on hand prior to rendering services to the patient.  The process can take several weeks to complete.  Pre-determination approvals are not a substitute for the eligibility and verification of benefits process. 

Conclusion

Each payor’s prior approval process is different.  It is important to know the managed care provider’s policies as well as the medical procedures which require prior action.  Understanding the subtle differences in these approval processes helps your facility avoid costly errors on front-end documentation. Remember, it is never as simple as calling the insurer and being told, “no authorization is required.”  Conduct due diligence.  It is very likely the approval of a patient’s procedure falls under one of these two categories.    

Carol Ciluffo – Vice President of Revenue Cycle Management 

Dec 22
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Billing Solutions

Billing Solutions: Forensic Collections – Lost Revenue Found

By Revenue Cycle Management No Comments

If you suspect your existing billing solutions service or internal business office isn’t managing your accounts receivable well, you are likely concerned about uncollected revenue.  Perhaps you recognize that acting quickly may allow your facility to recover lost income.

To obtain the objective data you need to make an informed decision about next steps, enter forensic collections mode.  Your goal?  Leave no stone unturned.

During your search for this potential uncollected revenue, include these activities:

  • Analyze the A/R and payor mix. Look for sizable changes or significant swings in outstanding balances.  Ensure you thoroughly examine patient balances.
  • Investigate write-offs including bad debt adjustments. Are the write-offs consistent with the reimbursement terms outlined in your payor contracts?
  • Examine billed charges. Review payors being billed.  Are your secondary payors being billed after the primary payors have paid?
  • Inspect implant billing and reimbursement. Compare the results to your contracts.  If separate reimbursement is allowed for implants, are you billing them accurately and receiving full payment?
  • Determine when the last fee schedule increase occurred. Are your billed charges keeping pace with your contractual reimbursement?

Here are a few examples of what my team and I have discovered while in forensic collections mode.

  • Our analysis of workers’ compensation claims revealed payments equaled 100% of billed charges. This rarely happens which lead us to dig deeper.  We compared the state’s work comp fee schedule to the facility’s charge master.  The state’s fee schedule was much higher than the facility’s charge master which hadn’t been updated since 2006.  We promptly notified the payors (per their contract requirements) that an increase to the facility’s fee schedule was scheduled to take place in 30 days.  Consequently, the facility realized an immediate increase in work comp revenue.
  • A review of Medicare claims revealed when a secondary insurance was active but not being billed. We queued up all claims within timely filing and billed them to the secondary payors.  The results were an increase in payments to the facility, a decrease in bad debt, and correction of balances erroneously being transferred to patient responsibility.
  • We reviewed ortho cases where implants were being used. Our analysis revealed the facility never billed for implants.  We discovered facility personnel knew their contracts allowed for implant reimbursement when claims were filed with supporting documentation.  However, they were unable to obtain implant invoices from their hospital partner thwarting their efforts to pursue payments on implants.
  • A review of patient balances revealed patients had not received statements in more than seven months.
  • In our review of claims denials, we discovered claims were never appealed. Payor payments were merely accepted.  The balances between the billed charges and the allowed charges were written off without first confirming their accuracy with the contract terms.
  • When changing patient accounting systems, a facility turned their entire A/R over to a collection agency. If they had opted to work that A/R themselves, hundreds of thousands of dollars could have been easily collected.
  • Facility contracts were not loaded into the patient accounting system. With each passing year, contracts and fee schedules changed but the cash poster’s memory did not.  Explanation of benefits (EOBs) were not compared to contracts.  Amounts received were accepted, correct or not.  Remaining balances were written off.  Credit balances were never refunded.

The examples go on and on.  It doesn’t have to be this way.  Audit early and often.  Be willing to dig a little to uncover potential problems and fix them.  When you do, your reward is a nice increase in your net revenue per case and happier investors!

Carol Ciluffo – Vice President of Revenue Cycle Management

Nov 29
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ASC Revenue Sources

Put the “Revenue” in Revenue Cycle Management from Your Most Important Source: Your Patients

By Revenue Cycle Management No Comments

Patients are quickly becoming the top revenue source in ASCs which presents unique challenges.  The days of “send me a bill” or “let’s bill your insurance and see what they pay” are long gone – at least they should be if you expect a steady flow on your revenue stream.

With the growth in high deductible health plans, your facility needs to develop and maintain a strong up-front collections strategy.   A patient’s out-of-pocket costs for their portion of a health care procedure can easily exceed their monthly mortgage payment.  An unforeseen medical procedure can place a significant burden on them.    

Although the situation can seem dire, all hope is not lost!  There are several things ASC personnel can do to proactively position your facility to collect the allowed reimbursement – from insurance carriers and patients.

Let’s start with insurance reimbursement.  When scheduling a patient for a procedure, ideally ASCs should:

  • Be in-network with the insurance carrier. If operating in an out-of-network situation, confirm out-of-network benefits are available to cover the planned procedure(s).
  • Confirm the scheduled procedure is allowed by the patient’s plan.
  • Verify the patient’s plan eligibility and benefits.
  • Obtain prior authorization, if required, for the procedure and implants.

Tools available to assist you with gathering patient specific information include payor web portals and eligibility information through EDI clearinghouses or patient accounting software. 

Using these invaluable tools enhances efficiency in the authorization process.  Take the information you confidently rely on and create your own tools to summarize your unique insurance contract details to serve as easy references for ASC personnel.

Employ features in your patient accounting system to alert facility personnel to nuances that are likely to be encountered.  For example:

  • Enter your fee schedules or grouper rates. Ensure this information is updated when your contracts change or renew.
  • Create reminder pop-up notes to alert schedulers to the need to secure authorizations for specific CPT procedure codes. If this feature is not a component of your current software system, establish your own list of CPT codes requiring authorization and sort it by payor.

Front desk personnel need to be able to calculate a logical estimate of patient financial responsibility and convey that information in understandable terms to their customers.  Information obtained during verification and authorization is necessary to accurately calculate patient estimates.  Identify the following patient specific details:

  • Their annual deductible and how much is remaining to be paid,
  • Their co-payment and/or co-insurance responsibility,
  • Their out-of-pocket maximums, if those limits have been met, and
  • Their in- and out-of-network benefits.

After you’ve collected patient specific details, determine what coverage is available based on your facility’s contract with the payor.  Begin by determining if the procedure scheduled to be performed is allowed in the ASC setting.  Then document the following:

  • Allowable amounts for each procedure code,
  • Multiple procedure limits and/or reimbursement reduction parameters,
  • Case rate caps,
  • Methodology for pricing and reimbursement of implants,
  • Carve-out rates, and
  • Other pertinent contract details.

Don’t overlook the information contained in payors’ newsletters.  This is where they outline policy and reimbursement changes, pre-certification requirements, packaged coding lists, annual fee schedule and grouper updates, etc. 

You should now have the information required to create a useful financial responsibility estimate for the patient.  Review your estimate in detail with the patient prior to the procedure.  Avoid assuming your patient knows the amount of their outstanding deductible or how much they will owe.  Be sure to reinforce that, although you have provided them with the most accurate estimate possible, they are responsible for any amount their insurance doesn’t cover.  Make sure to answer all their questions to the best of your ability and obtain their signature on your financial responsibility policy.

Once the financial responsibility estimate has been reviewed with your patient, it’s time to collect their payment.  Patients are more likely to remit payment at the time of service.  Once they’ve left your ASC, the chances of collecting from them are significantly reduced.  Try to avoid asking, “How much can you pay?”  Instead inquire, “How will you pay for your portion today?”  Improve your ability to collect payment by offering a variety of payment options – cash, HSA or FSA debit cards, credit cards, or automatic bank transfers.  If the patient is unable to submit payment at time of service, consider offering them a low interest health care loan or short-term payment plan.  It is in your ASC’s best interest to only do so, however, if upfront collection options have been exhausted.

If you must offer a payment plan option, have a solid policy in place and adhere to the defined parameters.  Your payment plans should be straightforward and manageable.  Remember to obtain the patient’s signature on the payment plan agreement, then follow the outlined terms.

Review your facility’s upfront collections processes, tighten them up, coach your staff, and work with your patients to create clarity regarding their financial obligations.  Doing this will ensure you maximize collections from your ASC’s top revenue source – your patients.

Carol Ciluffo – Vice President of Revenue Cycle Management

Oct 28
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Audit

To Audit or Not to Audit – That is the Question

By Revenue Cycle Management No Comments

Uncover the black holes in your revenue cycle management processes that impact your ASC’s bottom line.

Do you know what you don’t know?  Many revenue cycle management companies assess their services based on key performance indicators (KPIs).  Accounts receivable (AR) days, collections, bad debt, net revenue per case, days to bill, and days to pay are usually at the top of the KPI list.  While KPIs can provide you with a high level view of what is happening with your business, other seemingly minor items can result in uncollected revenue that may go undetected.  This is why auditing is crucial.

Auditing is a time consuming, daunting task.  Those being audited may feel it is punitive.  However, this necessary evil reveals a lot about the efficiency of your revenue cycle management processes.  Let’s look at the bright side of what you can discover while auditing and how your findings can result in process improvement that typically increases your bottom line.

There are many areas to audit – patient registration, coding, charge entry, denied claims, AR follow-up, and collections to name a few.  Routinely and randomly auditing your internal processes allows you to identify gaps that need to be closed, provide additional employee education when needed, ensure your payors correctly load your contracts in their systems, tighten your patient collections process, and so many more.  Let’s look at some of these in more detail.

Registration Audits

Accurate patient registration is the first step to a clean claim.  Routine auditing of registration errors will shed light on struggles being faced at your front desk.  Medicare Advantage Plans routinely trip up front desk personnel who may register the insurance carrier as Aetna rather than Aetna Medicare.  A key point to share with your front desk team is to consider the age of the patient to determine if he or she is a candidate for Medicare coverage.  Also, spend some time looking at copies of insurance cards with your front desk.  Create a notebook of insurance card samples and review them routinely, highlighting areas on the cards that will lead to proper insurance registration.

Another common registration error is registering a young child as the policy holder.  If the patient is not the policy holder, the date of birth of the policy holder will be required to file a clean claim.

Finally, ensure your front desk is taking advantage of online payor tools to verify eligibility and benefits, file requests for authorization, and determine the remaining deductible on each patient’s plan.

Coding Audits

Internal and external coding audits are an essential undertaking.  External audits supply an additional level of compliance and accountability for your coding services.  The external audit results can support internal audit findings or identify areas needing focus that your internal audits may have overlooked.  An external auditor can provide a non-biased, objective audit for you.  Internal audits provide a benchmark to compare to your external audits.  They also help you recognize when additional coder and/or physician education is needed to maintain compliance or secure proper reimbursement.

In your endeavor to obtain maximum allowed reimbursement, ask yourself the following questions.  Are you capturing all available procedures and billing them properly?  Are special modifiers required by individual payors recorded accurately?  Do your diagnosis codes reflect the greatest level of specificity?

Cash Posting Audits

Cash posting audits serve many purposes.  The accuracy of cash posting determines the need for the following:

  • Appeals on underpaid claims
  • Fee schedule increases
  • Payor contract updates in your patient accounting system
  • Additional education to employees on payor contracts and terms
  • Patient statement accuracy
  • Proper journal coding of adjustments
  • Timely credit balance reconciliation
  • Additional education to employees based on your audit findings

Denial Audits

Auditing your denials can be telling.  Are your employees filing timely appeals?  Timely filing requirements, similar to those applied to claims submission, also come into play with appeals.  Do your employees know what they are appealing and why?  If they don’t, unnecessary time is spent appealing denials that will not be successfully overturned.  Some examples are:

  • Filing an appeal on a code bundled into another procedure
  • Filing an appeal on a code that required a pre-authorization which was not obtained
  • Filing an appeal for medical necessity without reviewing the payor’s coverage policy of the procedure
  • Filing an appeal outside the timely filing limits set on the appeal
  • Filing an appeal of an implant payment when separate payment for implants is not allowed per the payor contract

Final Notes

Getting everyone involved in process improvement fosters buy-in and improves your chances of successfully tackling specific issues; but you can’t stop there.  You have to conduct routine audits to make sure old processes or bad habits don’t resurface.

Your time is valuable – make it count!  Determine where your pain points are and begin auditing there.  Share audit results with your employees.  Resolve the issues.  Celebrate the successes and the failures.  Those “failures” lead to correction of issues and improved processes.  Your efforts will pay off in reduced errors and, ultimately, enhance your bottom line.

By Carol Ciluffo – Vice President of Revenue Cycle Management

Oct 04
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Implant and Supply Reimbursement

Implant and Supply Reimbursement Blunders Nearly Every ASC Commits

By Revenue Cycle Management No Comments

Obtaining reimbursement for implants and supplies represents something akin to successfully navigating a minefield.  You know the lay of the land and presume the payors you hold insurance contracts with do too.  After all, you both possess the same road map – your ASC contract which clearly (ahem!) outlines the reimbursement you’ll receive.  However, when you receive a denial from the carrier for the billable implant or supply, you quickly recognize your interpretations of the contractual terms differ.

While there are distinct differences between an implant and a supply, these terms are often used interchangeably which can lead to significant confusion – even within your ASC.   So, let’s start with some definitions.

Medical supplies refer to the non-durable disposable materials necessary to perform or deliver a health care service in a single episode of care.  These supplies can also be referred to as consumable medical supplies.

Medical supplies:

  • are disposable in nature
  • cannot be used by more than one individual
  • are primarily and customarily used to serve a medical purpose
  • are generally not useful to a person in the absence of an illness or injury
  • are items such as gloves, gauze, dressings, needles, syringes, saline, surgical trays, bandages, skin preps, and other supplies needed during the course of a procedure
  • are typically inclusive to procedure reimbursement and are not separately payable

Most health insurance plans contain exclusions for consumable medical supplies.  Typically, you will not be reimbursed for these products because they are considered integral to the procedure itself.  They are an assumed cost of the surgery.

A medical implant on the other hand, is classified as a medical device manufactured to replace a missing biological structure, support a damaged biological structure, or enhance an existing biological structure. Examples of implants are pins, rods, screws, plates, surgical mesh, ocular lenses, prosthesis, etc.  Many payors define a medical implant as a device or item that remains in the body for six months or more.

Medical implants differ from medical transplants in that they are man-made devices.  Transplants are composed of biomedical tissue. Examples of transplants are allografts, autografts, tendons (musculoskeletal grafts), or corneas.

These differences in definitions may affect your ASC billing reimbursements.

As you know, implants and supplies are expensive and the cost can vary widely from vendor to vendor.  If your employees do not understand which category these items (i.e., implant or supply) fall into, your facility could leave a significant amount of money on the table.

How do you know if you should be billing for an implant or a supply? Start with understanding what each payor contract considers allowable. Most plans contain exclusions for consumable medical supplies although there are some cases where a supply is allowable. A temporary pain pump – a short term drug delivery system for post-operative pain relief – is a great example. 

The Healthcare Common Procedure Coding System (HCPCS) classifies a post-operative pain pump under the “medical and surgical supplies” category. However, because this “supply” delivers an enhancement above and beyond the normal scope of the standard procedure – it may be considered billable by some payors. To secure reimbursement, the item should be mentioned separately in the surgeon’s operative (op) report. 

The op report can also provide clues to other items used in a procedure that might be eligible for billing and reimbursement.  For example, some medications purchased by the facility, such as Botox which is used in occipital injections for migraine headaches, may be reimbursed separately from the procedure when billed properly.  Your coders should be looking for these items in op report narratives and billing for them when applicable.

In large part due to technological advances, implant intensive procedures which were historically confined to inpatient settings are now being allowed in the outpatient ASC setting.  This means outpatient facilities should know when and how to bill for them.  Implants are not cheap and, if left unbilled, could result in a significant amount of lost revenue to the facility.

To ensure you are billing appropriately for implants and supplies that are atypical to a standard procedure:

  1. Audit preference cards to identify supplies normally used in different types of procedures.
  2. Determine which supplies and implants used during a procedure could be viewed as atypical.
  3. Involve your materials management staff in the process – they have specific knowledge of items being ordered for your center. Research these items and assess if they might be billable.  If so, ensure the supply is added to the case implant log and inform your coding and billing team so the proper HCPCS code can be assigned and billed.
  4. If all goes well, you efforts will be rewarded with money in the bank!

To illustrate, let’s say your ASC used temporary pain pumps (a supply) 25 times in the first quarter of the year to provide non-narcotic post-operative pain relief to patients reducing their use of opioids during their recovery process.  The invoice cost of this supply, ordered in a pack of five, is $275 per pump.  If your contracts allow cost plus 10% reimbursement on implants and supplies, your reimbursement would be $302.50 per case.  If reimbursement was allowed on every case, your facility would receive $7,562.50 in reimbursement for those temporary pain pumps alone!

Is this a time consuming project? Yes. However, the rewards far outweigh the initial time investment.  Make sure your ASC is getting the money it deserves for its procedures. Your hard work will pay off in the end.

By Carol Ciluffo – Vice President of Revenue Cycle Management

Aug 29
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Authorization Requirements

If I Obtained Authorization for the Surgical Procedure per Payor Requirements, Why Aren’t They Covering the Implant Costs?

By Revenue Cycle Management No Comments

Seems crazy that a payor would authorize a surgical procedure which included an implant then deny payment on the implant, doesn’t it?  Unfortunately, it happens more than you might think.  A payor’s pre-certification and authorization requirements often dictate that implants be pre-certified or authorized in addition to the procedures themselves.

If you feel like the pre-certification and authorization cards are stacked against you, you’re not alone.  The rules of the game can be difficult to follow especially when each payor has its own unique set of guidelines.

Here are some hints on how to play the game well.  The first step is to identify which procedures require implants.  Then research the following to secure maximum reimbursement:

  • Does your contractual agreement with the payor allow separate reimbursement for the implant or is it inclusive to the procedure?
  • If separate reimbursement is allowed, determine what Healthcare Common Procedure Coding System (HCPCS) code will be used on the claim that references the implant. Check the payor’s master pre-certification and authorization lists to see if the HCPCS code for the implant is present.
  • If the HCPCS code is listed, obtain pre-certification or authorization for both the HCPCS and CPT codes prior to performing the service.

For procedures involving implants – especially those requiring pre-certification or authorization – failure to do your research on the front end will likely result in non-payment of the implant.  Most payors do not provide retro authorizations (approval for the implant after the procedure has been performed).  And appealing the denial of payment will not change the outcome if you did not follow the payor’s authorization requirements.  Further, not adhering to requirements specified in the contract results in a write-off of the total charge – you are not allowed to balance bill the patient.

Winning the game is possible!  Identify the procedures your facility performs most often.  Know which procedures involve implants.  Be familiar with the pre-certification and authorization requirements outlined in your contracts.  Understand the reimbursement nuances of your top payors.  Being informed on the front end ensures the dollars you worked so hard to secure actually arrive on the back end.

By Carol Ciluffo – Vice President of Revenue Cycle Management