August 25, 2008
10 Tips for Improving A/R
By Sheri Poe Bernard, CPC, CPC-H, CPC-P
Vol. 9 No. 17 P. 8
Medical office personnel have been slow to recognize the importance of identifying patients with consumer-driven health plans and are missing opportunities for easy collection.
A practice’s health can sometimes be measured by its accounts receivable (A/R). After all, if you are performing and reading a lot of imaging studies, the number of outstanding claims working their way through the system on any given day will be substantial. But it is also true that a high A/R can signal glitches in your processes, especially if accounts have been outstanding for more than 60 days.
Here are 10 tips that touch on nearly every aspect of the patient encounter and will help your radiology practice get paid on time:
1. Ensure that there are no surprises. Correct account management begins when the patient makes his or her very first call to the office to schedule an appointment. This is when the front desk should make queries regarding the payer to ensure the new patient’s insurance will cover the visit. If the patient doesn’t have insurance, he or she should be briefed on your practice’s payment policy. This ensures that no one is surprised during the first visit.
2. Do your homework. Once the front desk has a patient’s insurance information, including group plan and member number, practice representatives can confirm the patient’s enrollment in a plan before the actual patient encounter and can learn of any copays or deductibles that must be met. This will usually be done using online payer Web sites. If the practice is unable to confirm coverage, the patient should be contacted for further information.
3. Gather all the evidence. Once the patient arrives for the appointment, the real work begins. The front desk must validate all information gathered on the phone, beginning with the patient’s identity. Obtain photocopies of the patient’s driver’s license and insurance card. For established patients, it’s important to verify that no changes have occurred in personal or insurance information since the last encounter.
Keep in mind that Medicare requires the name on the claim to match the Medicare enrollee’s name exactly. Simple mistakes—if the private insurer’s group number has been transposed, the patient’s address is outdated, or the patient’s marital status has changed—can interfere with communication basics requisite to timely payments and add more than a month to the payment cycle.
One of today’s trends that is lengthening the revenue cycle is consumer-directed healthcare. According to America’s Health Insurance Plans’ Center for Policy and Research, the number of consumer-directed healthcare covered lives was 4.532 million in January 2007, and that number is expected to double in 2008. What does that mean to A/R? In consumer-directed healthcare, financial responsibilities shift toward the patient, who is provided with a high-deductible health plan and health reimbursement or savings account. In most cases, the employer funds the account and the employee draws from this account to pay medical bills. The fund is usually accessed through a debit card. This could be good for A/R, since payment for the services can be received at the time of the office visit.
But medical office personnel have been slow to recognize the importance of identifying patients with consumer-directed healthcare. Once the opportunity for easy collection is lost, the road to reimbursement is labyrinthine at best. Also, once the employer’s deposit in the fund is depleted, the employee pays out of pocket for a larger portion of healthcare services, usually 20% to 30% for everything except preventive services. Patients accustomed to a $20 copay experience healthcare sticker shock with consumer-directed healthcare, and this too delays payment.
4. Collect from the patient. If it’s a copay for a traditional plan, collect it up front. The administrative costs of billing a patient for the copay can consume the entire copayment, so anything you can do to avoid balance billing is worth the effort. For consumer-directed healthcare plans or other ones requiring the patient to pay a percentage, do your best to collect as the patient is checking out. With the intricacies of coding and reimbursement issues, this isn’t always possible, but see if changes can allow this practice within the framework of your office,
5. Document well. The key to prompt and full payment is correct and complete billing, and this is dependent on physician documentation. If the radiologist is performing tests for a referring physician, ensure that the referral includes information sufficient for documenting medical necessity. If it doesn’t, query the patient for further diagnostic information or contact the referring physician for more information.
6. Understand coverage controversies. Timing is everything. Regardless of how successful a procedure or test may be, performing it before it is covered by Medicare or other payers or performing it for reasons not covered by Medicare or other payers will end with nonpayment or protracted negotiations to get the payment. A good example of this is the current controversy over carotid stents. Know the Medicare rules and follow them; know the private payer rules and follow them, too.
7. Use professional billers and coders. Clean claim submission is dependent on knowing each payer’s rules for reimbursement, as well as the CPT and ICD-9-CM guidelines required for proper use of the codes. Hire a certified professional coder to do your coding and billing. These folks are required to earn continuing education credits that keep them abreast of new codes and rules. Whether they work in your office or for an outside billing agency, don’t cut corners on your coding staff. They are key to your practice, since dirty claims must be revised and those revisions can add months to the revenue cycle. Even if your practice is using a claims scrubber, you’ll want certified coders doing the coding. In addition to ensuring that more claims will sail through payer edits without a hitch, a coding professional will be adept at charge capture to get a payment for everything you do.
8. Befriend the payers. If you have a pleasant working relationship with your payers, you will find that many of your billing and claims disputes can be handled quickly over the phone. Keep a binder with payer contacts, including personal information and specialties. The more you do to befriend the payer representatives, the more they will do to help you when claims seem stuck in the system.
9. Know the law. Most states have prompt payment laws. Do you know yours? A simple review of explanations of benefits as they arrive in the office can alert you to payers who are not meeting the requirements of prompt payment laws. States may have regulations regarding the amount of time a payer has to contest a claim or make queries about its contents, as well as a timeline about what is a reasonable amount of time for the payer to make payment to the provider. Your state will have a process for filing a complaint against a violator of prompt payment laws but, generally, a gentle reminder of your expectations to the payer and the law will work to improve timelines in the future.
10. Set collections targets. If your business office has a high A/R or high aged receivables, set some targets and reward staff when the targets are met. Goals you may wish to pursue may include the following processes anywhere within the patient encounter:
• quicker generation of charges and claims;
• quicker and more standardized submission of claims;
• standards for posting payments upon receipt;
• standards for regular audits of claims;
• goal for payments per month; and
• goal for A/R balances.
Provide sufficient resources needed to accomplish the goals, from personnel to postage budgets. Don’t neglect the patient when your campaign is underway. Encourage patients to finance their balances through credit cards or banks. Similarly, maintain open communication with payers on your expectations and goals. A successful A/R campaign can set the stage for better processes moving forward, encouraging all players on the team to gather better information, communicate more effectively, and file cleaner claims and more timely.
— Sheri Poe Bernard, CPC, CPC-H, CPC-P, is vice president of member relations at the American Academy of Professional Coders (AAPC), the nation’s largest education and credentialing association for medical coders. The AAPC provides certified credentials to medical coders in physician offices, hospitals, and outpatient centers.