Could your practice be making more money? The experts say yes. Here are some places to look to find revenue your practice is missing.
Could your practice be making more money? According to healthcare consultants Deborah Holzmark and Doral Davis-Jacobsen, the answer is definitely yes. Holzmark and Davis-Jacobsen of the accounting and consulting firm Dixon Hughes, identified a list of “rocks to look under” - common oversights made by practices that could be costing them dearly - for attendees of the MGMA 2010 convention Tuesday.
Today’s physician practices are busier than ever, so it’s hard to find the time to review practice systems and processes. But with reimbursement deteriorating, managed care maturation, and less competition among payers, it’s also getting harder all the time to keep a practice in the black. Practices can’t afford to let money slip away due to inefficiencies and unexamined processes, Holzmark and Davis-Jacobsen said.
So where to look for missed financial opportunities?
Consider bad debt recovery; adjusted collections; time-of-service collections; managed care contracts; provider production and compensation; coding errors and processes; technology; and work flows.
Concerning bad debt, Davis-Jacobsen said, “It’s important to ask the question why are all these dollars being written off by each physician?” Though there are number of reasons she noted, including patient lack of insurance coverage, timely filing issues, lack of required prior authorization, and ER call cases, Davis-Jacobsen focused on uncollected copays as the most easily correctable problem.
Many people assume that the majority of write-offs are for uninsured patients, Davis-Jacobsen said. But in reality, a higher percentage of missed revenues are generated from unpaid copays of fully insured patients - money your practice could easily be collecting, and should be.
Davis-Jacobsen pointed out that for many patients medical bills fall to the bottom of the priority list for payment, after other bills are paid and groceries purchased. So it’s crucial to institute a good time-of-service collections policy and procedure.
“We enable this patient behavior,” Davis-Jacobsen suggested, by allowing patients to walk out of the practice without paying their copays and deductibles. She says practices need to change their mindset about time-of-service collections because when a patient walks out the door without paying his copay, there’s less than a 50 percent chance the practice will get that payment. Miss three $20 copays a day, and the practice would lose more than $15,000 a year.
Holzmark and Davis-Jacobsen said that 100 percent time-of-service copayment should be your goal. Start by getting the patient’s current insurance information at the time the appointment is scheduled, so coverage can be determined before the patient arrives.
Also, take advantage of the real-time claims adjudication that most payers are now offering. With real-time claims adjudication the patient’s claim can be submitted online while the patient is seeing the doctor, so an accurate EOB waiting for him at check-out. So the practice not only gets the copay at the time of the appointment, but any other deductible or money owed, which saves the practice the time and money spent sending multiple statements, making phone calls, and sending the patient to collections.
Holzmark and Davis-Jacobsen also suggested a technology growing in popularity among practices, but long-used in other industries, what they called “hotel-style payment.” The receptionist swipes the patient’s credit card at check-in. The front desk deducts the copay and gives the patient a note outlining any expected further charges. The patient’s credit card information is stored in a program built for this process, and when the EOB comes back, the card is charged and the practice sends a receipt to the patient. Just make sure the patient knows that this will happen. It’s easy for the patient and the practice collects efficiently and completely.
Holzmark and Davis-Jacobsen advised that as you examine your processes for lost revenues and implement new initiatives, you involve your staff. Track your efforts to improve areas like bad debt and time-of-service collections and make the results public among your staff as motivation. After all, your staffers are the ones actually collecting the money from patients and that can be a difficult job, so letting them know you appreciate their efforts goes a long way.
Abigail Beckel is managing editor for Physicians Practice. She can be reached at email@example.com.
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