Measure the Cost of Billing and Improve Your Bottom Line

Dr. H. James Harrington has been involved in quality and performance improvement projects since the 1950s. He is credited with the following statement, “Measurement is the first step that leads to control and eventually to improvement. If you can’t measure something, you can’t understand it. If you can’t understand it, you can’t control it. If you can’t control it, you can’t improve it.” ¹

Healthcare has explicit and complex reimbursement guidelines for most in-office and in-facility procedures, yet the most perplexing problem is how to measure the cost of billing the procedure, reworking a denial or writing-off any uncollectable charges.

Challenge

How do you – a provider, a billing company or a clearing house – apply edits to claims so that you or your client base are paid correctly on the first claim submission without incurring additional expenses of claim re-submissions?

Solution

In an article by Carl Mays II titled “Medical Billing Services Must Use Scrubbers” over 90% of the claims submitted after using a claim scrubber got paid on the first submission. A claim scrubber will reduce your outstanding accounts by 40-50 days. ¹

Claim scrubbers or editing engines, can be programmed to be as simple as checking for required fields on an electronic claim by alerting the claim submitter to missing or empty fields – these types of edits are commonly referred to as technical edits.  Complex editing or compliance edits utilize a more robust coding and billing engine can edit for medical necessity, unbundling, bundling, utilization and code and modifier validity checking.

A claim editing engine can be customized with rules which target reimbursement requirements that are specific to a region, a payer or even your practice.  Rules can be built to prevent common or complex denials. Editing engines prevent incorrect claims from being submitted to a payer which will be denied incurring additional expenses to re-work and re-submit a claim.  Edit engines allow for corrections to the claim before it is submitted to a payer and can be used at any provider workflow level.

 For instance, the diagram below is an example of a typical workflow for a patient encounter, at each stage an edit engine can assist the staff to check for medical necessity, apply regulatory and compliance edits and then perform a final analysis of the claim before the claim is sent to the payer automatically and in real time. The engine can provide reports for analysis by edit, provider, or offending code for measurement and education of staff.  Not only can this solution be implemented at the practice level, it can also be integrated with a clearinghouse, practice management or EHR system.

Patient Encounter and Claims Editing

At the Pre-Encounter stage – LCD/NCD checking occurs upfront where the ABN can be signed. During the Encounter stage – coding, regulatory and utilization edits are deployed.  At the back-end stage, before the claim is submitted to the payer, a final edit of the entire claim is done utilizing claim history, to review and allow for corrections. Claim reporting features allow for detailed provider claim analytics.

Context ⁴ Healthcare offers an array of edits that reflect your patient encounter workflow at each stage and offers not only real time editing and correction but can be integrated into your practice management system.  Analytics and dashboards are also a featured that allows you to view and measure your success rate.  Some of the edits include:

§  Unbundling

§  Re-bundling

§  Service over-utilization

§  Inappropriate and unnecessary services

§  Modifier appropriateness

§  Procedure/diagnosis attributes

§  Procedure to diagnosis relationships

§  Code validity

§  Data integrity

§  Customized Edits

§  ICD/CPT/HCPCS combinations

§  LCD/NCD

§  CCI

§  Medicare/Medicaid

§  Payer specific

§  Recovery Audit Contractor (RAC) issues

Let us help you measure and improve your bottom line today.

1. http://www.littlethingsmatter.com/blog/2010/08/23/you-cant-improve-what-you-dont-measure

2. Carl Mays II-http://www.claimcare.net/medical-billing-blog/bid/5473/Medical-Billing-Services-Must-Utilize-Scrubbers

3. Partners in Profitability How to choose the right clearinghouse for your practice- Navicure Whitepaper

Medical Necessity: Thin Line between Not Knowing Coverage and Fraud

Overview:

Determining what is “medically necessary” can be confusing since medical coverage policies are constantly changed by payers and health plans. What a physician defines as medically necessary may not be consistent with a health plan’s coverage policies. A physician who knowingly bills for services which are not medically necessary can be prosecuted for fraud by the Office of Inspector General (OIG). Violators face penalties of up to $10,000 for each service, an assessment of up to three times the amount billed, and exclusion from federal and state health care programs.¹

The Centers for Medicare and Medicaid Services (CMS), pays for medical items and services that are "reasonable and necessary" for a variety of purposes. By statute, CMS may only pay for items and services that are "reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member.” CMS has numerous  policies, including National coverage determinations (NCDs) and Local Coverage Determinations (LCDs),  that describe coverage criteria.² These policies may include a combination of CPT, HCPCS, and ICD codes, along with modifier usage and utilization guidelines. Other payers have their own coverage policies that may or may not follow CMS guidelines and depending on a patient’s coverage, multiple payer policies may need to be reviewed to determine medical necessity. 

Even if a service is determined to be "reasonable and necessary," coverage could be limited if the service is provided more frequently than allowed under a CMS coverage policies and its utilization guidelines.² Not only do providers have to determine the medical necessity requirements but they must also determine the frequency of the services or supplies and pharmaceuticals that are included in the policy and make an accounting of such services or supplies.

Claims for services which are considered not medically necessary will be denied by CMS. However, if CMS determines through an audit that services were medically unnecessary after payment has already been made, it is deemed an overpayment and the billed amount must be refunded with interest. Moreover, if a pattern of such claims are established and the physician knows or should know that the services are not medically necessary, the physician may face large monetary penalties, exclusion from the CMS program, and criminal prosecution.

Options

Your best option is to know your coverage policies but with ever changing codes and requirements this self service approach can be a daunting task. The office manager, biller and ancillary staff are already overwhelmed with administrative tasks. Accessing coverage policies for multiple payers may be impossible before a patient’s office visit or procedure is performed and determining medical necessity afterwards would leave a physician or patient paying for a potentially expensive service.

Solution

ClaimsEditor®  a medical claims editing solution offers Medical Necessity code combinations and utilization edits that  can assist your practice not only in being compliant with coverage policies but to proactively assist in pre-audit checking for fraud. Avoiding fraudulent claim patterns will not flag your practice in payers’ system, however with ClaimsEditor® you can easily see your error patterns using: interactive dashboards, reporting, sorting and triggers such as by provider, cost or edits.

Medical Necessity data can also be used to identify potential patterns of billing errors and overpayments in post-payment claims also. Both pre and post-payment claims can be run through Context’s claims editing software. Our solution flags a claim if a service is not medically necessary. The “edits” include overutilization, incorrect ICD/CPT &HCPCS combinations based on policies.

Medical Necessity information for payers can be accessed through Context’s online solution or by incorporating our data files into your own billing or EHR software. Clients have used our medical necessity products to access medical necessity information when patients are scheduled for procedures and services and seamlessly integrating components into their software and workflow. Medical necessity can be determined before a procedure is performed or a service rendered avoiding un-billable charges.

Call us today and let us show you how we can help you be successful with your Medical Necessity challenges.

1.    http://www.physiciansnews.com/law/802.miller.html  Nancy W. Miller Esq.

2.    Wikipedia - Medical Necessity Medicare

ICD-10 Delay: Extra Time to Supercharge Your ICD-10 Knowledge

In a recent Physicians Practice blog entry by Marisa Torrieri¹, ICD-10 transition and implementation was noted as one of the biggest stressors for physicians. The blog entry discussed a survey given to 394 physicians and practice managers by an EHR vendor where 85% of the respondents ranked the transition to ICD-10 and 5010 as one of the top issues impacting their practices while noting that this also affects healthcare employees in the ambulatory arena in different ways.

Physicians fear that ICD-10 will reduce time spent with their patients as they will be more focused on utilizing the new coding system and coding to a very specific code rather than focusing on the patient themselves. Some fear that they may end up shortening the patient visit or seeing fewer patients in a day.

Practice managers on the other hand are stressed over productivity, increased workloads, training on the new coding system along with implementation and coordination of new technology.

Billing managers are concerned with how the new ICD-10 changes will affect the workflow of claims and reimbursement in general.

Customized superbills:

The Centers for Medicare & Medicaid Services (CMS) delayed the October 1, 2013 implementation of ICD-10 to a proposed October 1, 2014 ³ and this may give practices the much needed time and opportunity to actually get hands-on training and practice utilizing the new coding system. 

Few directions are provided on how to customize code sets to eliminate time spent searching through several thousands of codes a practice may never use. The key will be customizing your ICD-10 code sets and data itself. It is unlikely that you will be utilizing most of the approximately 68,000 diagnosis codes.  

You can customize your super bills to your specialty using ICD-9-CM to ICD-10-CM Diagnostic code mapping for specialties such as Anesthesia and Cardiology by utilizing Context⁴ Healthcare’s Linkage Libraries in CodeLink^® Pro. Create and build-a-bill (your super bill) to your specifications to provide real hands-on ICD-10 coding practice for you and your staff. CodeLink^® Pro will allow you see what your new ICD-10 codes will be for your specialty. Also, it will allow you to customize code notes or favorite most used codes to build-a-bill – your new super ICD-10 bill.

Transition challenges mitigated:

A recent ICD-10 survey performed by the Workgroup for Electronic Data Interchange (WEDI), reported that one in five of the 2,597 providers surveyed were expected to complete ICD-10 readiness assessments with half of responding providers stating that they did not know when the assessments would be finished.² Health plan leaders reported that one in five of the 661 plan respondents indicated they had either not started or were less than one quarter of the way complete with their gap analysis. Only one in six of the 418 vendors participating in the survey had not even started preparing their products for the ICD-10 transition.

Let Context⁴ Healthcare show you how to make the transition from ICD-9 to ICD-10 seamless and effortless with CodeLink® Pro. As a healthcare software vendor, we offer ICD-10 products tailored to your specialty such as build your own Super Bill allowing you and your staff hands on ICD-10 practice, ICD-9 to ICD-10 cross-walks and code search ability by key words or indexes.

Context4 Healthcare, Inc. announces agreement with Employer Plan Services, Inc. to provide databases for Usual, Customary & Reasonable Fee Data

Naperville, IL & Houston, TX - March 27th, 2012 - Context4 Healthcare, Inc. announced today that they have added Employer Plan Services, Inc (EPSI) of Houston, TX to our successful client base. EPSI will be utilizing Context4 Healthcare Usual, Customary & Reasonable health payment benchmarking databases which will include Medical, Dental, HCPCS, Anesthesia and Outpatient Facility.

“We are pleased to become part of the Context4 Healthcare family”, says CFO Chris O’Sullivan of EPSI. “It was very beneficial to understand that Context4 HealthCare is a strategic partner of SunGard and their integration with the SunGard iWorks GBAS claims system to load the data is seamless”.

“We are pleased that EPSI have selected us as their strategic partner and we look forward to working with them for many years to come” said Mark Earles, President and CEO of Context4 Healthcare. “EPSI provides benefit design and administration services to employee sponsored health plans in a very complex and challenging market. Our health payment benchmarking solutions will empower EPSI’s mission of providing value added partnerships to its clients”.

About Context4 Healthcare, Inc.

Headquartered in Naperville, IL, Context4 Healthcare, Inc. develops software solutions to solve complex medical claim coding, claim editing and reimbursement challenges. Context’s software and data products enable healthcare providers and payers to reduce claim errors, denials and claim-handling costs. Privately held, Context4 Healthcare is not affiliated with any payer or provider organization. More than 3,500 physician practices, hospitals, insurance carriers, third party administrators and managed care organizations currently use Context4 Healthcare products. Learn more at http://www.context4healthcare.com/

About EPSI

Since 1978, EPSI’s goal has continued to be the best in our Industry. We are the employee benefit company that provides cost-effective solutions as third-party administrators, brokers and consultants. We believe our existence depends on the continued satisfaction of our clients. As EPSI continues to enhance capabilities and provide alternatives to the changing benefits environment, we manage more than 1,000 benefit plan designs, while covering over 250,000 participants regionally and nationally. Client industries range from chemical manufacturers and industrial distributors to national retailers, non-profit organizations and municipalities. Learn more at http://www.epsibenefitsinc.com.

The Game Changer: Why CMS is Abandoning its Pay and Chase Model of Payment

Problem for CMS
The Centers for Medicare & Medicaid Services (CMS) is working hard to reduce improper payments by developing a new method of detecting inappropriate billing and payment before claims are paid alongside the current method of post-payment audits of providers.

Why is this important to providers? Legislation requires that most Medicare claims be paid within 30 days which traditionally has meant that CMS paid out claims before investigating them – what officials call the "pay and chase" model. CMS is under increasing pressure to move away from this model to a more proactive and preventative approach that scrutinizes providers claims before they are paid. Providers’ claims will now be analyzed and audited before a payment is made for services, therefore affecting revenue flow on a daily basis. ¹

Several features that are included in this pre-payment review methodology are: rigorous review of medical necessity and documentation, prior authorization certifications and physician reimbursement. CMS will incorporate a Predictive Analysis Model to prevent fraud and abuse which will utilize a claim pre-payment edit method. The predictive analysis may use a methodology that would include alerts for physician practices that routinely charge the highest amount for a procedure in a given zip code. High risk claims are flagged by the editing algorithms for providers who routinely over utilize certain services or items based on claim histories. As claims move through the CMS predictive analysis system, it will build profiles of providers, billing patterns, and utilization assigning risk scores to each provider. Providers with high risk scores will be flagged and their claims will undergo greater scrutiny. ²

Predictive analysis has been used in other business segments for a long time such as by lenders and credit card companies. Ever wonder how Amazon recommends items to purchase? Amazon uses predictive analysis data mining based on what you have bought before. Ever wonder why you were denied purchasing gas at a gas station three states away from home? Predictive analysis flagging potential fraud based on where you reside. One busy afternoon of shopping at the mall – or a whole day of shopping at the mall – warrants a call from your credit card company to check if the one doing all the spending is you. Predictive analysis is predicting you have had enough of treating yourself, with spending limits flagged and challenged at the point of purchase. This same method of predictive analysis has been applied to medical claims as of July 1, 2011 in 10 states that have the highest risk of waste fraud and abuse and will be rolled out to an additional 10 states by October 1, 2012.³

Problem for Providers
These types of payment pattern models cause a profound impact on physician practices as they struggle to keep up and adapt to reflect compliance with CMS guidelines, the looming ICD-10 changes and the ever more demanding meaningful use criteria of Electronic Health Records (EHRs) already burdening physicians.

How does a busy practice prevent improper payment and interruptions to revenue flow? As CMS moves to pre-payment claims review, physician practices are best served with utilizing a claims editing solution that also incorporates medical necessity checking with documentation alerts. The solution should also have the charges validated as being covered, non-covered and at Medicare Par and Non-Par rates.

While CMS has indicated that certain patterns determined through predictive modeling will be flagged and investigated, very little information is available regarding what those patterns or targets may be, therefore it is also a priority to be able to change and create edits quickly in a claims editing software as CMS alters any of its analytics metrics.

One suggestion is that providers should monitor their own claims for patterns and outliers that may raise a red-flag for CMS. Providers should be prepared to explain and demonstrate why such patterns and outliers exist. By applying pre-payment edits to the front of the practice workflow using a claims editing solution much can be accomplished before the claim is transmitted to CMS. Pre-payment denials can be avoided and the likelihood of additional audits can be decreased.

Solution
A solution that fits the prepayment schema is ClaimsEditor^®. Edits are displayed with messages and alerts and reports are provided that parallel CMS, RAC, OIG and the Fraud and Abuse predictive modeling. High cost services, or equipment by provider can be identified through your claims information. See what you‘ve been missing and how we can help you stay on your game at http://www.context4healthcare.com.

1. CMS Manual Pub 100-20 One Time Notification , dated February 24, 2012, Transmittal 1049 CR 7669
2. US Department of Health and Human Services Strategic Plan Fiscal years 2010-2015
3. CMS Small Business Jobs Act of 2010

Health Trends in 2012 – What’s in a Number

Medical cost trends are expected to rise from 8.1% to 8.5% in 2012.

As cited in the article titled “Behind the Numbers Medical Cost Trends for 2012-Health” Health Research Institute 2011, medical cost trends are expected to rise from 8.1 % to 8.5 % in 2012.

Medical cost trend is the projected increase in the cost of medical services and is used for setting premiums for health insurance plans. About 33 percent of all benefit cost is attributed to physician services, while inpatient hospital costs are second at around 31 percent and outpatient hospital services are 17 percent. Prescriptions are at 15 percent of medical cost and the remaining 4 percent are costs associated to services such as Home Health, Skilled Nursing Facilities and medical equipment.

This increase is influenced by the unit cost inflation, changes in unit prices of medical products and services that may be affected by the economy, inflation and new technology. Changes in the volume of services or utilizations are another driver that may increase medical costs and may be affected by demographics, advertising and the use of technology.

For consumers, providers and payers, it is important to know what the cost of a service, equipment and new technology will be for each year, as health plans prepare to set their yearly insurance offerings to employers.

Finding out what other providers of medical services and equipment are charging can be a daunting task. Each year new services and their related procedure codes and fees need to be established from a variety of data points.

One way to access this cumulative data is to obtain the fee of the service or medical equipment from Context 4 Healthcare. Based on Geozip - Usual, Customary and Reasonable Fees (UCR), Physician Fee Reports, as well as Medicare Par and Non Par fee for service are available in a single data source. Armed with knowledge that represents cumulative data, correct decisions can be made to price medical services and equipment.

400th Usual, Customary, & Reasonable Client, Lone Star TPA Calls Upon Context 4 Healthcare

Context 4 Healthcare, Inc. announced today that they have added Lone Star TPA of Tyler, TX as their 400th client utilizing its Usual, Customary & Reasonable health payment benchmarking databases.

“We are pleased to have added Lone Star TPA as number 400.” said Mark Earles, President and CEO of Context 4 Healthcare. “Lone Star TPA provides benefit design and administration services to employee sponsored health plans in a very complex and challenging market. Our health payment benchmarking solutions will empower Lone Star’s mission of providing value added partnerships to its clients.”

“Attaining our 400th UCR client is an important milestone for Context, but it is our ability to create and maintain successful client partnerships that is crucial to our success”, added Earles. “We look forward to serving Lone Star TPA for years to come.

About Context 4 Healthcare Inc.

Headquartered in Naperville, IL, Context 4 Healthcare, Inc develops software solutions to solve complex medical claim coding, claim editing and reimbursement challenges. Context’s software and data products enable healthcare providers and payors to reduce claim errors, denials and claim-handling costs. Privately held, Context 4 Healthcare is not affiliated with any payor or provider organization. More than 3,500 physician practices, hospitals, insurance carriers, third party administrators and managed care organizations currently use Context 4 Healthcare products. Learn more at www.context4healthcare.com .

About Lone Star TPA

Lone Star TPA distinguishes itself through experience in the self-funded industry, integrity, responsive service, integrated technological solutions and commitment to client satisfaction. Learn more at www.lonestartpa.com .