Tips to Better Practice Management

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Tips to Better Practice Management

• Creating a Health Practice

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• Managing a medical practice is hard work!
• The practice of medicine is both an art and a
  science that is constantly evolving.
• So too are the rules involving insurance
  payments, claims filing procedures and other
  aspects of managing the practice
• Our communities where medicine is practiced are
  also continuously evolving.

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• In this climate of increasing economic,
  regulatory, and demographic pressures, its more
  important than ever to streamline processes and
  work effectively.
• There are some simple things you can do to make
  life easier. Weve compiled a list tips to better
  practice management, gathered from experts who
  have lived these challenges and consultants who
  work with practices to increase productivity,
  affect the bottom line and retain the right
  employees.
• As youll see from reading them, simple changes
  often can have a profound effect on your ability
  to manage within the health care environment.

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Managing Your Accounts Receivable

• Enter Fee Schedules Into Your Computer To
  Monitor Reimbursement
• One way to assure you are getting reimbursed as
  your contracts with major payers say you should
  is to monitor your reimbursement from these
  payers. Mary Le Grand, a consultant and coding
  specialist with Karen Zupko Associates, Inc.
  suggests that you enter your payer fee schedules
  into the computer to allow staff to easily spot
  when a payer reimburses below schedule or applies
  the wrong discount. If your system does not allow
  payment schedules to be entered, create an Excel
  spreadsheet showing your major payers, high
  volume CPT codes, and expected reimbursement. If
  you do not have payment schedules for your high
  volume payers, survey your payers for your high
  volume procedures. Try to obtain fee schedules
  for at least 80 of your volume

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Watch Out For These Common Errors When Creating
Claims

• Learn from collective wisdom about what not to
  do in submitting claims. Some of the most common
  errors in submitting claims are missing or
  incorrect patient subscriber number, different
  name and address for patient from what the
  insurer has, missing physician tax ID or Social
  Security number, diagnosis that is not coded to
  the highest level of specificity, and illegible
  claims, says Sarah Larch of University Physicians
  Inc.
• Set up a process to check for these common errors
  on all claims and save yourself some grief.

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Create Meaningful Reports

• One effective way to get better A/R stats is to
  share data about your business operations with
  everyone in your office. But that means creating
  reports that are meaningful and communicate the
  situation precisely. Dont overwhelm employees
  and physicians with too much detail about your
  cash flow and claims history. Use graphs to
  illustrate key points. Remember that people have
  different learning styles and try to accommodate
  different styles in how you present data (for
  example pictures vs. words). Explain all
  abbreviations and definitions used, pull out
  trends so they are clear and understandable to
  your audience, and issue reports on a regular
  basis so that your office will come to expect
  them and know what to look for, advises Sarah
  Larch of University Physicians Inc.

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Audit Your Payers For A Healthy A/R

• You should develop an audit process to see which
  payers need your attention to keep your A/R
  healthy. You can collect 96 to 98 of your net
  charges if you set up your audit process the
  right way. First, look at those payers that are
  slow to pay. Anything more than 60 days in A/R
  should definitely be given attention. Then, look
  at what percent of your business these payers
  represent. Then, look at whether they are paying
  you 100 of the fee schedule, or whether they
  are trying to get by with paying you less. Set up
  a database to keep track of these data elements
  and stay on the back of the payers who arent
  living up to their contract. The more information
  you have to take to them to justify your
  complaints about slow pay or inadequate money,
  the more effective you will be in your efforts to
  get them to pay you what they have agreed and in
  a timely manner. If you cant monitor all payers
  effectively, start with the ones who represent
  the largest share of your business.

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Develop A Threshold for Contracts

• One of the secrets to healthy accounts
  receivables is auditing your accounts to make
  sure youre getting paid in accordance with what
  the contract stipulates. But equally important, a
  healthy A/R begins with contracts you can live
  with. Develop thresholds beyond which you will
  not sign any contract, advises Terri Welter. Pay
  attention to the details of all contracts and
  make sure that if the insurer does indeed pay you
  as stipulated in the contract, you are being
  adequately reimbursed. Otherwise, youre better
  off not signing the contract. Your decision will
  be based on how much market share a payer
  represents, of course, but your group should
  decide what you are willing to tolerate before
  you go into negotiations.

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Avoid the OIG, Send ABNs

• Make sure your Medicare patients are notified of
  their payment responsibility through the Advance
  Beneficiary Notice and audit your practice to see
  that ABNs are sent when they need to be. Keep
  copies in your patients chart.

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Motivate Staff To Improve Cash Flow By Developing
Benchmarks

• How can you motivate your office to improve cash
  flow and collect more? First, establish key
  indicators, recommends Mark Farrington, a
  consultant with KarenZupko Associates. If
  measurable standards result in improving your
  billing and collections, those elements become
  benchmarks for staff. Remember that billing and
  collections isnt the responsibility of only the
  billing and collection staff. Front-end staff and
  clinical staff can make a huge difference in how
  much and how quickly you collect. For example,
  key indicators for registration staff might
  include the number of rejected or delayed claims
  due to inadequate information taken during
  check-in or lack of authorization, the number of
  statements returned due to bad addresses, and the
  percentage of co-payments collected. Clinical
  staff might be measured on how regularly they
  turn in their charge slips and how complete the
  information is.

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Enhance Collections by Managing Charge Slips
Right

• Heres a simple tip to speed up your collection
  efforts from Betsy Nicoletti of Helms Company
  of Springfield, Vermont Your physicians can
  assure more money is collected faster by always
  telling the billing office what services were
  performed and the correct diagnosis of the
  patient directly after seeing the patient. In
  most offices, says Nicoletti, the check out clerk
  has to track down information for the charge slip
  more than a few times a week. Sometimes the slip
  gets put into a folder for later follow-up and
  the charge may not get entered into the computer
  system right away. Make sure physicians carefully
  complete charge slips and track slips that are
  returned to physicians with questions so you can
  see where the weak spots are in your system for
  reporting charges. Also, monitor hospital and
  other out of office services to see whether
  physicians are submitting their charge slips on a
  timely basis. If a charge slip is sitting in a
  physicians pocket, it obviously isnt getting
  paid.

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Take A Look At Your Medicare Business In Light of
New Reimbursement Schedule

• As Medicare continues to ratchet down payments,
  practice expenses are exploding. Malpractice
  premium hikes, a continuing trend of employee
  health insurance increases,
• and a need to retain talented employees with
  competitive salaries put the pressure on.
  Jennifer Bever of Karen Zupko and Associates
  (http//www.karenzupko.com) says it is important
  to define
• Which commonly provided services are affected
  most by Medicare cutbacks.
• What the expected impact on revenue is.
• Whether the practice can absorb the decrease by
  tightly managing expenses.
• Bever recommends you start with these steps Run
  a payer mix report to determine how much of your
  business is Medicare-based. Take an inventory of
  your commercial managed care contracts. How many
  are based on Medicares payment methodology?
  Apply the expected reduction to revenues from
  Medicare and those commercial carriers adopting
  the new payment rates. Add in expected revenue
  from other payer sources to calculate total,
  projected revenues for the following year. Now
  review expenses from this year. Can you absorb
  the decrease in revenues by tightening down
  expenditures? Develop a task force to brainstorm
  ways to cut costs.

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Benchmark Your Billing Office Against Better
Performers

• To benchmark the performance of your billing
  office, measure yourself against better
  performers as reflected in data gathered by the
  Medical Group Management Association in a recent
  survey of medical practices. How long are your
  bills in accounts receivable? Better performers
  have 49 of their A/R that is 0 to 30 days old,
  17 that is 31 to 60 days old, 8.5 that is 61
  to 90 days old, and 5.3 that is 91 to 120 days
  old on average. They have only 17 over 120 days
  in A/R on average. If they can meet these
  benchmarks, your office most likely can too, but
  it may require some reengineering of your
  collections processes.

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Dont Let Your Patients Off The Hook

• Stacey Haynes and Carolyn Duncan of BKD in Kansas
  City (www.bkd.com) advise that when collecting
  patient balances, begin with the largest accounts
  first. Determine what steps your office will take
  at accounts that are 60 days, 75 days, 90 days
  and 120 days old. Set your computer to drop a
  bill to the patient within three days after
  posting the insurance payment. Send a second
  notice 30 days later. Fifteen days later you can
  send a collection letter. When negotiating a
  payment schedule with the patient, have a
  bottom-line, smallest amount acceptable for
  payment policy have the patient sign a contract
  and explain the exact agreement to the patient.
  Track patient payments each month. Follow up with
  letters and calls if the patient misses a
  payment.
• Heres a sample letter payment agreement from
  Haynes and Duncan
• This letter confirms your (monthly/weekly)
  payment agreement you made with us to resolve
  your unpaid account. You agree to pay ____ to be
  received in our office by the ______ of each
  month. The first payment will be due _____. We
  agree that no interest will be charged as long as
  the terms of the agreement are met. If there is
  either a problem with the amount of the payment
  or the beginning date, please notify us
  immediately. No further collection action will be
  taken as long as the agreed upon payment is
  received. Additional charges you may incur are
  not subject to this agreement.

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Your Scheduler Can Play An Important Part in
Creating A Healthy A/R

• Dont discount the importance of the person who
  schedules office appointments in collecting A/R,
  say Stacey Haynes and Carolyn Duncan of BKD, LLP
  in Kansas City, Missouri (http//www.bkd.com).
  Your scheduler obviously should know the reason
  for the patients visit, the patient contact
  information, whether the patient expects the
  practice to fill an insurance claim, and the name
  of the patients insurance company. But the
  scheduler also should know what insurance
  programs the provider participates in, what
  companies require referrals and for what
  services, what services need prior authorization
  or patient re-certification, and what co-payments
  the insurance plan requires. Thats a lot of
  information and requires appropriate training for
  your scheduler.
• Armed with the right information your scheduler
  can help you collect. First, the scheduler can
  advise the patient who doesnt have insurance
  that payment is expected at the time service is
  rendered. Second, the scheduler can get the
  person the right information about responsibility
  for the bill before the patient even sees the
  doctor. Third, the scheduler can make it clear to
  the patient that the practice expects to be paid.
  When the scheduler calls to remind the patient of
  the appointment, he or she should know whether or
  not a referral is required and if it is, get it
  (which can avoid claim denial later on), and
  whether the patient has an outstanding balance,
  and if the patient does, politely remind the
  patient that payment will be expected at the time
  of the appointment.

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Take A Collection Quotient Exam

• 1. Our practice collects cash equal to or greater
  than 90 of the collectable (net charges).
• 2. Our practice verifies insurance eligibility
  prior to every ambulatory care service.
• 3. We verify eligibility and obtain
  pre-authorization/referrals as needed for all
  inpatient services.
• 4. We know when co-pays are due and collect them
  at time of service.
• 5. We collect cash each day.
• 6. Our staff is well-trained in registration and
  insurance requirements.

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• 7. We have management reports that enable us to
  review the quality of our staffs registration
  data.
• 8. The staff believes the registration data is
  accurate and high quality.
• 9. Our claims are rejected by payers less than 10
  of the time.
• 10. Our practice offers credit cards as a payment
  option at all sites and on patient statements.

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• 11. Both staff and physicians know what contracts
  we have and what the critical elements of those
  contracts are to ensure compliance and
  appropriate reimbursement.
• 12. Our patient statements are easy to read and
  informative.
• 13. Our days in A/R are in line with best
  practices.
• 14. Our practice has cash controls in place to
  ensure all money is accounted for each day.
• 15. Our practice captures the referring physician
  for each service provided.

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• 16. We review all patients accounts for previous
  balances due prior to their appointment and
  inform patients.
• 17. Our payment posting staff tracks rejections
  and provides feedback to front desk staff.
• If you marked any unknowns, find out the
  answers. Then count your no answers
  10-17--dramatic improvement in cash possible,
  4-9--significant improvement possible, 1-3-- some
  improvement possible