Efficiently Managing Underpayment to Increase Practice Collections

1
(No Transcript)
2
Efficiently Managing Underpayment to Increase
Practice Collections
What is Underpayment in Medical Billing? An
underpayment in medical billing refers to a
billing situation where practices are expecting
higher payments for delivered services while
insurance carriers have paid a lesser amount for
the same services. Usually, denials arise due to
incorrect patient information while underpayments
stem from incorrect billing prices. Underpayments
are tricky since insurance carriers wont let you
know they arent paying you the full contracted
amount. In your contract, insurance carriers
might have already mentioned that they will pay
the billed amount instead of the contracted
amount. They can pay the lesser of the two and
are not obligated to give you the amount you
couldve received. As underpayments are not
highlighted as denials, their lasting effect
could severely affect your bottom line.
Efficiently managing underpayment will definitely
lead to an increase in your practice collections.
Managing underpayment fairly straightforward
process and spending time tracking your payments
will be worthwhile down the line. Common Reasons
for Underpayment Insurance carriers always look
for a reason to deny claims. Careless billing
makes it easy for them to highlight your
inefficiency resulting in denied or partial
payment. Some of the top common reasons for
underpayments
3
Efficiently Managing Underpayment to Increase
Practice Collections

• are as follows
• Old billing schedule Practices keep on billing
  various procedures as per the old fee schedule.
  Providers or billers unaware of the revised fee
  schedule enter a lesser charge amount than
  insurance carriers allow.
• Fear of payer audit Practices always try
  everything to avoid external payer audit
  requests. Due to fear of payer audits, their
  billing team keeps on charging the same amount
  year after year.
• Missing information Billers sometimes leave out
  critical information that supports the claims.
  Early in the scheduling process, note what
  documentation is needed to receive full
  reimbursement.
• Insurers miscalculating payment In the case of
  therapy service, insurance carriers might come to
  different monetary conclusions. You can appeal in
  such a case by maintaining detailed notes
  regarding the sessions and segregating billable
  vs. non-billable hours.
• Contract misinterpretations Confusing contract
  language in healthcare legal agreements can lead
  to differing interpretations. During contract
  disagreements, legal intermediaries may be the
  only viable solution.
• Healthcare practices actually consider their
  contracts with insurance companies as a binding
  commitment.

4
Efficiently Managing Underpayment to Increase
Practice Collections
Its unfortunate to reveal that if given the
opportunity, insurance carriers are ready to pay
10 to 14 percent less than their contracted rates
to practices. For the financial sustainability of
your practice, its important to be proactive.
Some of the common processes for efficiently
managing underpayments are listed
below. Efficiently Managing Underpayment Find
out the Fee Schedule You wont be able to
pinpoint underpayments if you dont know what you
deserve to be paid. You can request all insurance
carriers with which you participate to provide a
current fee schedule. Rather than asking for a
fee schedule for all procedure codes, you can ask
for the fee schedule for your practices top 50
procedure codes. Most insurance carriers may
ignore your request. The good news is that
Medicare and Medicaid reimbursements are
publically available the Centers for Medicare
and Medicaid Services (CMS) offer a fast and easy
online look-up tool for Medicare. Most states
also post their Workers Compensation rates
online. Commercial reimbursement, however,
remains a challenge. Read Remittances
5
Efficiently Managing Underpayment to Increase
Practice Collections
Getting a fee schedule for procedure codes is
just the first step. Now, you need to set up a
review process to ensure that you get them 100
percent of the time. True, your staff could
manually compare each incoming Explanation of
Benefits (EOB)/ Electronic Remittance Advice
(ERA) against the insurance carriers rate
schedule. Once you start reading electronic
remittances you will be able to pinpoint even a
single underpayment. Follow up on underpayments
with the same vigor and tenacity as you would a
denied claim. Remember that like denials,
underpayments should be identified on a line-item
basis. Dont accept reimbursement for one line
item as payment in full. Inspect by line item,
not by the encounter. Get Help Its challenging
for providers to keep track of payer-wise billing
guidelines and reimbursement policies. As
providers are busy in patient care, getting help
from medical billing company could be beneficial
for your practice. Medical billing companies are
aware of billing industry updates so they can
guide to avoid underpayment. As they are working
with various other practices of the same medical
specialty, following billing guidelines and
avoiding underpayments is easier for them.
6
Efficiently Managing Underpayment to Increase
Practice Collections
Healthcare practices annually lose revenue that
gets written off as contractual adjustments when
insurance carriers underpay according to the
contractually allowed amount. Medical Billers and
Coders (MBC) identifies and corrects such
underpayments, incorrect adjustments, and zero
payments from all insurance carriers. To know
more about our complete billing and coding
services, email us at info_at_medicalbillersandcoder
s.com or call us at 888-357-3226.