• Industry News
  • Access and Reimbursement
  • Law & Malpractice
  • Coding & Documentation
  • Practice Management
  • Finance
  • Technology
  • Patient Engagement & Communications
  • Billing & Collections
  • Staffing & Salary

Payers and Cascading Payments: Tips for Your Medical Practice


Here is an easy and quick tip that will immediately increase your inflow with minimal time and effort from treating staff at your medical practice.

Over the past few years, we've all seen it. Insurance companies are moving towards a "cascading" payment scale, and I think it's their way of giving you all a pay cut without actually coming out and saying that.

It is critical that you identify within your payer mix, those insurance companies that follow this type of payment practice. I know that Medicare and Aetna cascades some of their codes, Blue Shield cascades all of their codes (most all plans now), and some workers' compensation plans also cascade. Once you identify your payers that cascade, you will need to know what you are reimbursed for your CPT codes for each of those payers. Your billing department can help you identify this and create your rate sheet if you do not already have one.

Keeping these in mind, think about how many of these patients you see daily, weekly, and monthly. Think about this now: Do you know if you are charging your most expensive code, first? Your answer needs to be “Yes!” Let me show you a few Blue Shield scenarios that might help you review with your billing department to make sure you are on the right track. In these scenarios, first code pays at 100 percent; second code pays at 80 percent; third and fourth codes pay at 40 percent.

• Let's use REHAB Codes as an example – think about this:

1. 97110x2, 97530x1, 29530x1 (where 97110 pays $25.75 per unit, 97530 pays $29.75 per unit, and 29530 pays $61.34 per unit) By placing them in this order, you will be paid $82.79 for that visit.

2. 29530x1, 97530x1, 97110x2 (where 29530 pays $61.34 per unit, 97530 pays $29.75 per unit, where 97110 pays $25.75 per unit) By changing the order, you will be paid $105.74. That's a difference of $22.95 for one visit! Think about if you see this patient two times to three times per week, or 12 times per month what that can do to your inflow with very little effort on your part.

So, let's say you see 10 to 15 patients per day whose payer mix includes one that cascades, and if you can save yourself $20 to $25 per visit by simply changing the order of your coding, this could yield you $200 to $375 more per day in inflow or $4,200 to $7,875 per month. Can you use that much extra inflow right now?

Be sure that you are communicating with your billing department to see if their software will sort these for you from most expensive to least expensive. If the software does not, be sure to ask if it re-sorts how you write them down, or enter them yourself. We do not want your focused efforts to take a loss.

Take a look now at your rate sheet and you should know the percent of your payer mix (how many patients are Medicare, private payers, workers' compensation, cash, etc.) and do a quick analysis. Once you make this change and follow up with your billing department to ensure your codes are in the correct order, watch your inflow slowly increase. It will be worth the small effort it takes to change your focus in this area.

Also, learn your payer mix, and how they reimburse you for your services. Know what they need to have from you to make reimbursement decisions and know their tips and tricks that yield you the maximum amount. You deserve it!

Find out more about P.J. Cloud-Moulds and our other Practice Notes bloggers.

Related Videos
The fear of inflation and recession
Payment issues on the horizon
The burden of prior authorizations
Strategies for today's markets
Syed Nishat, BFA, gives expert advice
Doron Schneider gives expert advice
David Lareau gives expert advice
Krisi Hutson gives expert advice
Krisi Hutson gives expert advice
Krisi Hutson gives expert advice
Related Content
© 2024 MJH Life Sciences

All rights reserved.