Keeping a Healthy Financial Practice
By Rachel M. Mitchell, CPC-H
Are there ever days when you feel that you are treating twice the number of patients than you have previous years but collecting less? With reimbursement levels decreasing physicians must increase productivity to make ends meet. You may be driven out of practicing medicine if you do not keep a healthy financial practice.
Studies have shown that the majority of physicians undercharge far more than they overcharge. One idea has been instilled into our heads that CMS (aka Medicare) is watching and waiting to find billing errors so that they may fine practices. An even greater issue is that medical practices in rural areas are subject to criticism for their method of charging since everyone knows everyone else in a small town. Physicians may feel pressured into undercharging for their evaluation and management services because they know most of the local residents on a personal level. Physicians must separate patient care from billing practices. The billing staff is employed to act as the buffer between doctors and patients. Physicians can take the heart out of the billing practice without taking the heart out of patient care.
Utilizing optimal codes for reimbursement will improve office income. Physicians have every right to code what is appropriate based upon their documentation. If a patient wishes to question their bill while in a treatment room, the answer is to direct them to the billing staff or office manager. Instruct the billing and coding personnel to make it a point to inform patients that their charges are determined by the documentation and treatment plan that they are given. Distance yourself politely from patient billing questions and let your account representatives take care of the grief.
Reducing overhead by cutting corners on office supplies, equipment rentals and staff will assist in keeping a healthy cash flow. Shopping for less expensive employee benefits and renegotiating insurance contracts for higher reimbursement are other options. All are constructive methods to improve finances.
Keeping a tight staff sounds negative when in fact, if you hire top of the line personnel, your office will be extremely efficient. The accounts receivable should be worked constantly. The longer a claim has been sitting at an insurance company, the less likely it will be paid. Account representatives must focus on aging accounts and resolve them quickly.
If every means possible has been exhausted to collect on accounts, consider hiring an aggressive collection agency that will report debt to patients credit history. Surprisingly enough, people will pay their medical bills if it effects applying for credit cards, homes or cars.
Here are some additional ideas on cutting costs and increasing revenue:
· Eliminate unprofitable services
· Market the profitable services
· Review the A/R on a weekly basis. Less than 20% of the receivables should be sitting in the over 90 day category.
· Review types of services performed. Set up a report that will tell you how many procedures were done month-to-date and year-to-date.
· Consider dropping payers who continuously decrease reimbursement without willingness to renegotiate.
Ms. Mitchell is the Billing and Coding Manager for Applied Medical Systems, Inc., an accounts receivable management company in Durham, North Carolina. Ms. Mitchell has over 10 years experience in medical billing, coding and consulting. For any questions regarding the above editorial you may reach Ms.Mitchell at (919) 477-5152 or at email@example.com.
This article is reprinted with permission from the March 2002 issue of M.D. News magazine.
This article is copyright © 2002 Applied Medical Systems, Inc.