Private sector changes: Flashback to HMO days

February 1, 2013

As the health care landscape shifts to meet the needs of ACA, it's beginning to look a bit like it did in the heady days of HMOs.

Reform of the U.S. health care system, particularly Medicare and Medicaid, has been dominating the national headlines as well as our own column of late. Meanwhile, the private sector has not been idle. The changing rules within private-sector plans are affecting payment and causing yet another financial headache for urology practices around the country, reminiscent of the old health maintenance organization (HMO) days.

While we cannot address all these changes, we will tackle a few of them here. As always, we welcome your feedback and encourage you to speak to us when you see us or e-mail us (ut@advanstar.com) with problems you see or solutions you’ve found so we can share them.

Review addendums carefully

One of the larger issues we are running into is the focus on non-payment of certain services provided in the urology office. Obvious to many has been the increase in the number of plans from insurers like Aetna, Cigna, United, and Blue Cross Blue Shield with exclusive contracts for radiology and pathology services. Many of your contracts include or have had addendums added to require that all lab tests (other than urinalysis in many cases) be ordered from designated lab partners.

As addendums to contracts tend to be dropped en masse or at time of renewal, a number of groups have not had the chance to review the changes and discover too late that they will no longer be paid for lab services. Appeals for reprocessing fall on deaf ears, and the practice is out the cost of the tests. The same is true for imaging services.

What can you do? To start, set up a system to clearly monitor your contracts. Build a file for each payer you work with and add a current contract to it. Include any addendum published to the file after it is read. After reading an addendum or reading through a contract or proposal, you may wish to consider exiting that plan. Analyze the impact to your practice based on number of patients, overall revenue, payment level, and lag time. If the payer does not represent a significant part of your revenue and you are busy, dump them. You can fill the slots with other, better payers.

Of course, this is a simplified way to analyze contracts. You may have to consider other aspects, such as plan participation for referral sources and hospitals you work with on a regular basis. A more comprehensive approach would include the development of a quick and standardized operational process for contract analysis.

Unfortunately, even the best proactive analysis of your contracts will miss some silent third-party administrators and other hidden contracts. Therefore, an action plan to communicate pattern denials on pathology or radiology codes needs to be developed that includes contact with payer, review of contract, and explanation of benefit appeal review. Remember that issues like this can be plan specific, so Aetna, for example, may pay you if the patient has a higher level plan and not pay you with a lower cost plan. Do not overreact; collect the data you need and implement protection plans.

Issues with guided referral

Another trend reminiscent of HMOs is that of guided referral or prior authorization referrals. More and more, we are seeing denials based on a lack of prior approval as noted on the referral. Although there is significant variation as to how this is implemented in different parts of the country, the biggest impact seems to revolve around HMO-type plans; both managed Medicare products and typical commercial products are being affected. These trends tend to result in non-payment for any non-evaluation/management code provided for a patient referred by a primary care physician.

As with your contracts, make sure you have a protocol for reviewing referrals. With paper charge tickets or superbills, many offices circle the services approved by the referral slip. Often, the urinalysis is allowed in addition to an office visit, but each payer should be checked to determine what is included in a standard referral for each plan type. With the electronic health record, a note can be added to check-in, or another protocol may need to be developed. Review your contracts and take note of which plans require referrals and the type of referral required. This process may be difficult to determine with a contract reading, so a call to provider relations with a written record of the discussion may save time.

Your billing team will need to be in sync to notify you of these types of denials. Your front office staff will need to make certain that they are carefully collecting demographics and checking benefits for each plan as they check in patients. Call for referrals as needed and make sure that you obtain any updates to referrals prior to providing services.

In most cases, the benefit eligibility check will provide you with the information that you need to make sure you are not providing services for which you will not be paid. This process of checking demographics and eligibility may require some additional training and should not be ignored. Although these eligibility systems are not perfect, they are usually the most up to date and should be used for each and every visit.

As we have helped practices develop protocols and processes to identify and react to the changing health care environment, we have found it necessary to add training and evaluation of staff. The best-laid plans do not ensure success. Execution of a great plan by supported, qualified, and trained staff is the best ticket to a successful practice.UT

Coding and Reimbursement
Ray Painter, MD, Mark Painter

Urologist Ray Painter, MD, is president of Physician Reimbursement Systems, Inc., in Denver and is also publisher of Urology Coding and Reimbursement Sourcebook. Mark Painter is CEO of PRS
Urology SC in Denver.