BUILD A MEDICAL BILLING MACHINE IN LESS THAN A WEEK. isalus Healthcare. Page 1

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1 BUILD A MEDICAL BILLING MACHINE IN LESS THAN A WEEK isalus Healthcare Page 1

2 TABLE OF CONTENTS Introduction Page 1 Monday Page 2 Tuesday Page 5 Wednesday Page 7 Thursday Page 8 Friday Page 10 Wrap-Up Page 11 Page 2

3 INTRODUCTION Hi, and thanks for being interested in turning your practice into a Medical Billing & Practice Management Machine in Less than a week. DID YOU KNOW? According to a Milliman 2006 Study, a Medical Practice can save $42, per year by automating their medical practice with electronic transactions? It s true, and we can t wait to help show you how to put your practice on the path to success! In this free and power packed E-Book, we tell you precisely what steps to take each day of the week, within a single work week, to turn your practice into a thriving success. Caution, side effects of implementing these tactics include excessive practice happiness, increased patient care, and heightened profitability. Oh, and did we mention leaving early on Fridays? Milliman 2006 Study Manual Costs Electronic Costs Savings Per Transaction Transactions per Year Estimated Annual Savings Claims $6.63 $2.93 $3.73 6,200 $23, Eligibility Verification $3.70 $0.74 $2.95 1,250 $3, Specialty Care Reviews (Refferals) Health Services Review (Pre-authorizations) $8.30 $2.07 $6.22 1,000 $6, $10.78 $2.07 $ $ Payment Posting $2.96 $1.48 $1.49 4,340 $6, Claim Status $3.70 $0.37 $ $2, Total $42, Page 1 Page 3

4 MONDAY Ahhhhh, Good ole Monday Morning. Got your coffee? Check! Had your Monday morning chocolate doughnut? Check! Awesome, let s begin the process of turning your practice into a wild success story. TIP 1: SUBMIT INSURANCE CLAIMS SAME DAY We can t tell you how often we hear practice administrators and medical billing specialists tell us that they batch their insurance claims, and submit them to the payers once per week, or worse yet, once per month. That s enough to make most accountants fall down with chest pain because it s really not an advisable business practice for any company let alone small businesses like medical practices. Typically, when we ask medical billers why they re batching medical claims, the answers is some flavor of that s how we ve always done it. So why is batch billing such a bad idea anyway? Good question, and the answer is pretty straightforward: batch billing of insurance claims is a bad idea because it delays a practice s cash flow, and in small businesses, CASH IS KING! Medical practices need a financial buffer so that they can weather the storm in case of serious problems like ICD-10, an event causing payers to tell medical practices to apply for lines of credit to survive. The only way to build up a reserve cash flow is to get your medical claims out the door the same day as the patient encounter. HOMEWORK So, your first assignment is to change the process in your practice such that you begin submitting claims the same day as the patient encounter. If you want extra credit, you could begin measuring the time between the SOAP Note completion in your EHR, and the electronic claims submission date in your medical billing software application. Page 42

5 MONDAY - CONT. TIP 2: RECONCILE APPOINTMENTS AND CLAIMS Most Medical Practice Management Systems, Medical Billing Software Systems, and Electronic Health Records (EHRs) don t do a great job of making sure every patient appointment loaded in the appointment scheduling software turns into an electronic claim that will produce revenue for the practice. What s with that? These systems are, after all, supposed to help you manage your practice! Furthermore, many practices have no process at all for making sure appointments turn into claims. And unfortunately, if you re using a separate Medical Billing Software and Electronic Health Records system that are bridged together by two vendors, then there s no automated Appointment to Claims Reconciliation process in place because the systems weren t initially designed to work together. Nothing is more critical than making sure hard working medical providers get paid for their services. With all of the challenges the insurance carriers create to delay payments, the last thing you want to do is add to it with inefficient processes within the medical practice. Just imagine if (2) claims worth $100 each go unbilled each month. That costs the practice $2,400 per year in lost revenues, and believe it or not, that s probably a very conservative estimate for most practices.stimate for most practices. Page Page 53

6 MONDAY - CONT. 2 EASY FIXES a Apply a Manual Fix: Create a Microsoft Excel Spreadsheet or even a paper log with a column of all patients that showed up for appointments, and a second column of all patients for whom an electronic claim was submitted. Check this log daily, or at the very least weekly. b Select an EHR & Billing Software that Automates this: Good EHR & Billing Systems with well thought out designs will do things like automatically alert providers on their iphones to remind them to submit charge tickets, automatically remind providers in their EHR to finish SOAP Notes, and even create charts & graphs that show what percentage of appointments are billed out to the clearinghouse as electronic claims. Call your current vendor & ask them if they already have something like this, and if there s not a way to achieve this objective, you can either do it manually, or search for vendors that automate this for you. Page 4 Page 6

7 TUESDAY TIP 3: REBILL REJECTED ELECTRONIC CLAIMS SAME DAY Tuesday s here, and you ve implemented (2) very smart changes to your practice that will pay dividends to the practice for years to come. Pat yourself on the back. WHEEEW HEEWWW! Way to go. Now, let us move forward with another simple yet completely powerful tip for improving the financial performance of your medical practice. Most Medical Billing and Practice Management Software programs either have an integrated clearinghouse or they allow you to export electronic claims files to your computer so you can submit them to the clearinghouse. In either case, when you complete the charge entry process each day, and submit your electronic claims batches to the clearinghouse, there will always be some percentage of those claims that don t successfully pass all of the clearinghouse claims edits, and those are called rejected claims. Rebilling rejected claims consists of reviewing the error message provided by the clearinghouse, and fixing some aspect of the electronic claims file, then resubmitting it to the clearinghouse for processing. The problem is that many medical practices don t resubmit rejected claims every day which means that they are delaying their Accounts Receivable by not taking every possible step to get reimbursed as quickly as possible. Page 57

8 TUESDAY CONT. IMPLEMENTING THE PROCESS IMPROVEMENT a If you are uploading your claims to a clearinghouse that doesn t interface directly with your Medical Billing Software, you can simply login to your clearinghouse each day, filter your claims list to see all rejections, and rebill once you ve made the appropriate fix. b There s a much better option than using an external clearinghouse which consists of finding a Medical Billing Software System with an integrated clearinghouse that proactively alerts you when you have rejected claims, and allows you to do all of your billing within the system instead of having to live in two systems. Many of these systems actually provide practice-wide dashboards with colorful graphs throughout the software program so that all practice members can see what procedure codes (CPTs) are being rejected most frequently and why. This is a very convenient feature, and one that would possibly provide you with a Return on Investment (ROI) for an Electronic Health Records & Medical Billing Software program. Some healthcare providers may even opt to purchase a new system for such a feature because the financial implications are so significant to the practice. Page 6 Page 8

9 WEDNESDAY TIP 4: USE REAL TIME INSURANCE ELIGIBILITY VERIFICATIONS Hopefully, by now, you ve implemented (3) amazing changes to your practice & you re well on your way to turning your practice into a Medical Billing Machine! Each year, the American Medical Association publishes a Health Insurance Payer Report Card which includes, among other things, the percentage of claims denied each year by denial reason. Consistently, one of the most common denial reasons, sometimes even representing 50% of all denials, is inactive insurance benefits. This is a denial that could be easily solved by verifying that the patient has insurance & is eligible for the visit. Most medical practices understand the importance of verifying a patient s insurance eligibility before seeing the patient; however, many medical practices simply don t have the time or resources to call the insurance company every time they see a new or existing patient. There are a couple of easy ways to fix this problem, and it s well worth fixing because claims denials can cost a practice tens of thousands of dollars per year in revenue losses. The best way to fix eligibility-related denials is to use a Medical Billing & Practice Management Software system that allows you to verify a patient s insurance eligibility with a single mouse click. Why is this the best fix? According to the 2006 Milliman E-Transactions study, practices will save $3.73 per patient, or an average of annually $3,693.04, by using electronic eligibility verifications. This feature adds a lot of convenience, and while you could make the argument that the front-desk could simply call the insurance carriers to verify a patient s insurance eligibility, the inconvenient truth is that most of them are way too busy checking patients in & receiving co-pays to be on the phone calling payers. Thus, they simply don t make the calls. Remember, when you call a payer to verify a patient s insurance eligibility, you re most likely going to be on the phone for about minutes for a single patient. That pretty much rules out the calling option. Ultimately, using a vendor that allows you to verify benefits with a single mouse-click should save a practice thousands in lost revenues. Page Page 97

10 THURSDAY TIP 5: POST PAYMENTS USING ERA {Electronic Remittance Advice} This tip is a surprising one because while nearly all Medical Billing Software vendors allow you to accept ANSI 835 files (the techy name for the ERA file), there are still thousands of medical practices posting payments the old fashioned way by looking at a paper EOB (Explanation of Benefits), and hand-keying the payment into the software program. Not only is this incredibly time consuming and costly when it comes to labor costs, it s also often inaccurate because it s fraught with human data entry errors. For this reason, the most sophisticated & streamlined Medical Billing Experts are posting their payments with the click of a mouse using ERA technology. According to the Milliman Study referenced above. Posting ERAs instead of manual payments saves a practice just under $6,500/YEAR Page 10 8

11 THURSDAY CONT. TIP 6: SUBMIT PATIENT STATEMENTS AUTOMATICALLY WITH A STATEMENTS PARTNER This tip is about 2 things a) Office Efficiency b) Acceleration of your revenue cycle, aka, getting money in the door faster Most Practice Management Software and Medical Billing Software vendors will provide access to print-houses that have the ability to automatically print and mail patient statements to your patients. Keep in mind that much like printing claims in your office, the estimated cost of printing a patient statement includes the human labor cost of printing statements, getting those statements off the printer, putting them in envelopes, clicking the envelopes, putting stamps on them. Then, there s also the cost of the raw materials such as toner cartridges, envelopes, stamps, and paper. It s safe to estimate that similar to the Milliman cost savings chart annotated above, the cost of printing a single statement in the medical office is likely between $6-$7 per statement; however, there is a silver lining in that most Practice Management Software companies will pull the statement data for you, and print/stuff/mail the statement for anywhere between $.70-$.90 each. Multiply the cost savings on a per statement basis by all of the patient statements you send each month, and you ll quickly earmark this as one of the best changes you ve made to your medical billing process yet. Page 9 Page 11

12 FRIDAY TIP 7: PROACTIVELY RECALL PATIENTS OVERDUE FOR A RETURN VISIT If you have implemented the (6) previous tips, your medical practice is ready to soar, and you ve just created a recurring monthly financial dividend that will no-doubt pay for the duration of the practice s existence. Plus, you ve successfully made it to hump day, something worthy of celebration. Tip 7 is where patient care intersects with increased revenues. By tracking patient visits, and the coinciding CPT and ICD Codes used during each visit and on each claim, your practice can proactively determine which patients are overdue for follow-up visits. The beautiful thing about doing this is that it cannot only increase patient care delivery which will make all of the staff happy, but it can also inject your medical practice with increased revenues. a b c d Find a Medical Billing and Practice Management Software that automates this for you. Good Practice Management Software Programs will allow you to build a search query of the patients you would like to recall into your office by CPT/ICD code, and then print custom letters that can be mailed to the patients requesting them to show up for appointments. The nice thing about using a system that already has this build in is that it will be faster, more efficient, and more effective. Doing it manually is also an option. In order to do this, you would need a report of all patients that have visited your office within a certain time period along with their CPT/ICD visit codes. You could then type up letters in Microsoft Word, or another Word Processing Software, and mail these letters to the patients. Call them on the phone. Another option would be to simply create your list of patients that need to be recalled, and call them at home. The downside to this is that many medical practices do not have the resources to have an employee making phone calls to patients to recall them into the office. The last and potentially best option would be to combine letters a & c above, sending them recall letters automatically and having a staff member call to make sure they received the letter. By doing this, the chance of a patient returning would go up significantly. Page Page 12 10

13 WRAP-UP WELL, AS THEY SAY, ALL GOOD THINGS COME TO AN END! If you ve successfully implemented all of the Medical Billing best practices in this e-book, you re well on your way to turning your practice into a Medical Billing Machine. We really hope you ve found this guide helpful, and hope to provide you with more helpful tips soon. Page 13 11