Today’s billing process: Follow these 11 steps

February 1, 2016

There are several very detailed steps that we will combine into 11 separate functions that have to be performed in a prompt and accurate fashion in order to submit a clean claim and be paid in a timely fashion.

 

It goes without saying that the billing and collections process is very complicated. It’s a fact of life you must deal with.

In order to get paid for the services you provide, you have to jump through many hoops. The payment rules are complicated and precise. The entire billing process and collections process has to be equally timely and accurate. None of it works well without your participation. One way or another, the clinical part of the practice must interface with the administrative side of the practice to generate effective collections. If you ignore the problem or attempt to manage the problem through ESP or general “good thought waves,” you will lose money.

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The only real solution is to learn and deal with the process. Through established protocols, communication, and top-to-bottom training, you can minimize your lost clinical time and maximize your administrative effectiveness.

In this article, we address the reality of today’s billing process (see “4 decades of billing, collections: How times have changed" for magnitude of changes), providing a list of the steps required to submit bills and get paid for services in a fee-for-service environment. Your options for truly addressing these issues are much broader than the list we provide here but will have to wait for another day.

There are several very detailed steps that we will combine into 11 separate functions that have to be performed in a prompt and accurate fashion in order to submit a clean claim and be paid in a timely fashion. If you submit a “clean claim,” you will be paid-usually within 10 to 14 days. If the claim has erroneous information, is incomplete, or is not billed according to the payer rules, payment is delayed, usually by 45 to 60 days, if you get paid at all. The cost of dealing with a denied or rejected claim has been estimated to be about five times the cost of submitting a “clean claim.”

We use “clean claim” in quotes as the definition of a “clean claim” is not necessarily a claim that accurately describes all that you have done and the reason that you have provided the services, but more broadly refers to a claim that conforms to the payer’s rules. Judging lost revenue in the claims game is all a matter of perspective.

Let’s start the journey of billing. The steps may need to be changed slightly for different places of service and adjusted to conform to your practice management system.

Next: Make appointment and collect all demographic and insurance information

 

Make the appointment and collect all demographic and insurance information. Accurate demographic and insurance information is critical. To collect this, you need to have intelligent, committed, friendly, and experienced type “A” employees. Information must be collected and double-checked each visit.

The information collected must be entered accurately, efficiently, and routinely for each patient into the Practice Management Information System/Electronic Medical Record System (PMIS).

Evaluate coverage to include eligibility, deductibles, co-pays, coinsurance, need for preauthorization, pre-certifications, etc. Again, this needs to be checked at each visit. Coverage and policies may change and often without patient understanding. Check eligibility before each visit either online or via phone; it is not a guarantee, but it is better than hoping for the best.

Collect co-pay, coinsurance, and outstanding prior balances. Co-pays and an estimate of coinsurance prior to provision of service based on what is scheduled are appropriate and should be the target protocol. Additionally, a check for prior balances should have been done and communicated to the patient when the appointment is confirmed. The office should collect all balances due, reschedule, or make sure that there is an appropriate payment plan in place.

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Remember, payment plans that do not exceed charges will never result in a paid-in-full account. Balancing appropriate care and financial responsibility is difficult, but it can be done. Assign a higher-level office person to discuss issues with patients who disagree. Ideally, the office structure should allow for a more private discussion. Many offices choose to leave money collection until after the visit is complete due to physical structure and the ability to clearly identify charges for services provided on that date. If you choose this method, your office will need to be diligent in follow-up for collections and handle large balances for many patients before allowing the patient to be rescheduled.

Next: Identify services provided

 

Identify services provided. The physician/physician assistant/nurse practitioner who provides a service is the most qualified to identify all services provided. This is best done by a pre-developed shortlist either in an EHR, “super bill,” or some electronic format. The performing provider checks off all services provided. Remember, 85% to 90% of visits are reported under a combination of one to four CPT codes from a list of 25 to 30 different codes. In short, most of what is done in the physician office is similar from a billing perspective from patient to patient.

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Communicate the services provided. If the protocol is to communicate all services provided by the clinician to the staff and allow the staff to determine whether the service is billable, the provider of the services will need to communicate any special circumstances for each service or require a note review by the billing staff to determine whether the payment circumstance warrants the use of a modifier. For example, did the E&M service meet the definition of a –25 modifier and should be charged in addition to a procedure?

Verify payer rules for all services provided. The billing staff will need to communicate with accounts receivable staff, if separate, to develop clear guidelines for billing services to each of your major payers. Monitor changes in rules through websites and EOBs.

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Submit claim. Double-check clearinghouse or PMIS for payer acknowledgement of receipt of claim.

Next: Count the money daily

 

Count the money daily. For payer payments: Review EOB for accuracy and coverage explanation, and match to bank deposits. Monitor electronic funds, credit cards, and checks for each payer and balance to stated receipts minus take-backs (if any) on a daily basis. Money collected from patients or received via mail or credit card will also need to counted, tracked, and deposited. Many have found that the lockbox and bank-directed collection, in addition to check scanners and credit card processing, work best.

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Do not leave one person in charge of all facets of money intake. Deposits need to match the PMIS and the bank records; each step of the process should be delegated to a different person if possible, and the bank is a good place to delegate payer collections via lockbox.

Take additional action as needed:

  • Resubmit, modify, or appeal claim if needed.

  • Collect appropriate additional amount from patient.

  • Write off bundled and other non-payable services.

Analysis and feedback. Communication is key in the process and, sadly, the most overlooked. Many times, physicians tell us they are being paid for services that were not billed as they thought or were not billed at all. Again, hope and ESP are not adequate in billing. Obtain reports monthly and review them. Some common reports we have seen in addition to accounts receivable and relative value unit reports include monthly production reports (CPT counts per month), denial reports, unbilled encounters, and lag time.

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Note that not all PMISs are created equal; you will need to determine what your system can do and what it cannot do. You can add supplemental reporting to virtually any system, but it may be cost prohibitive. Remember, a mistake that is made once can be corrected. A mistake made over and over again will not only be costly and hard to correct but could lead to broader consequences.

Next: Compliance and billing/collections SWOT

 

Compliance and billing/collections SWOT (strengths, weaknesses, opportunities, and threats) analysis. Each office should have a detailed compliance plan that checks for errors and details correction processes. In addition, since the process is so complicated, each office should periodically have their entire process reviewed in depth to determine the office’s strengths, weaknesses, opportunities, and threats.

Summary

Every office and every billing department develops its own personality, knowledge, and expertise. Everyone is absolutely sure that they are correct, or they would change what they are doing.

Unfortunately, many times someone has misinterpreted a rule or has missed new changes that cost the practice thousands of dollars. We have seen that most practices are too busy and do not have time to drop back and review or plan for changes they know need to be made. Some are taking shortcuts that they think are fully justified but cost the practice money.

The billing process is moving too quickly to allow things to just hum right along. Every office needs to adopt a philosophy of continued improvement and include an external periodic checkup from top to bottom. In the end, the billing process is a part of any healthy practice and those who wish to stay in practice will constantly and consistently deal with it.

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The information in this column is designed to be authoritative, and every effort has been made to ensure its accuracy at the time it was written. However, readers are encouraged to check with their individual carrier or private payers for updates and to confirm that this information conforms to their specific rules.

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