"Data, data, data. That's the key."
So says Deron Schriver, executive administrator of The Women's Healthcare Group in York, Pa. In an atmosphere of fluctuating reimbursements, shifting patient insurance coverage, and the uncertain impact of health reform on private practice, quality data to inform decision making is more important than ever, Schriver says.
When he joined the 6-physician OB/GYN practice nearly five years ago, he found that it was being underpaid by most payers, compared to the going rate at the time. "I think our payers really knew they were getting a good deal with what we had in place," he says.
But after a little cleanup and some reorganization, Schriver says the practice is caught up, has its data readily available and constantly monitored, and there has definitely been a reaction from payers.
"I've noticed it is getting difficult each year to get the increases we are looking for," he says. "There is a lot of push back and a lot of offers and counteroffers taking place in our negotiations."
But Schriver notes that as far as reimbursements, the practice is "very pleased" knowing "it has been a little tough out there."
"I'd say the rates we are getting are keeping us financially strong, regardless of what we are seeing with the economy, so we are pleased about that," he adds. "However, we are noticing the environment out there is getting more difficult from a reimbursement standpoint."
This is evident in our 2010 Fee Survey Schedule. Looking at national averages for commercial reimbursement for new and existing patient visits, the average increase in payments by commercial payers is only 1.4 percent from the prior year. Government reimbursement continues to lag commercial rates, although by narrower margins.
The complete data are found on the following pages, along with some analysis. More important, though, is advice from the experts on how to put your practice ahead of the average.
For the most part, commercial payers are still above national Medicare reimbursement rates, except when it comes to longer visits with patients. The 99204, 99205, 99214, and 99215 visits are all being reimbursed, on average, 18 percent below Medicare, with the 99205 a whopping 28 percent lower. The 99213 midlevel established office visit is reimbursed by commercial payers at $68.27, up 4.1 percent from 2009 — the biggest leap among all E&M codes — and slightly higher than Medicare's $66.74 payment, which itself is up 8.1 percent from last year.
In fact, all Medicare reimbursement rates for E&M codes are up an average of 7.4 percent. Congress and the president avoided a double-digit Medicare cut in June, replacing it with a modest increase in average rates of 2.2 percent. But draconian cuts in Medicare seem to be on the table at all times, and Congress was wrestling with a prospective cut of 21 percent as this issue was going to press.
So with the likelihood that whatever is done at the federal level will be mirrored among private payers, it is more important than ever that practices look hard at the data when it comes to the dollars coming from three key sources: commercial payers, the government, and patients.
You can find tips and advice on how to work with patients on what they owe by reading "Getting Patients to Pay."
Here's some help in getting paid more for the work you are already doing at your practice and some things you might be able to tweak to boost revenue.
Get in the mix
Part of Schriver's job is evaluating payer mix, the amount of practice revenue tied to each insurer. Each month he reviews a report generated by his practice management system showing the percentage of charges for each payer and related collections.
"You need to know how much of a share each payer has of your business, and use that to your advantage from a negotiation standpoint and from an overall contract management standpoint," Schriver says.
Reed Tinsley, an accountant and business adviser to practices, says payer mix evaluations are vital to identifying two key issues: vulnerabilities and opportunities. Evaluating your payer mix identifies potential problems for your practice — suppose there is a major change in reimbursement from one of your larger payers? You can also identify payers who may not be worth working with at all, and those too big to dump but whose low rates cry out for renegotiation.
With data in hand, Tinsley advises practices to be proactive and start improving relationships with those managed care plans. Many practices believe that such discussions will be fruitless, but "you have to try," he advises. Even if you can't negotiate better rates on the first try, he adds, "at least you will come out of those discussions knowing what it will take to improve your reimbursements down the road. You go back to your office, strategize on what it will take to improve and start making those improvements."