A Shot in the Arm For Vaccines

July 24, 2008
Robert Lamberts, MD

There is no bigger expense with a lower return on investment for a medical practice than immunizations. Here are some way to maximize reimbursement.

Immunizations are no fun.

I’m not talking about the screaming child in the exam room. That’s just all part of the joy of treating little ones. No, I mean dealing with the management of immunizations within a medical practice. There is no bigger expense with a lower return on investment for a medical practice than immunizations. In fact, you can even lose money giving vaccines.

Why is this?

  • Inventory -- Next to payroll, immunizations are the number one overhead line item in our office. Vaccines range from $10-$200 each, and they are purchased in large quantities. If you choose to administer vaccines, you must stock enough to ensure availability when needed. Some need refrigeration, others need freezing temps. Some are seasonal (flu shots), or given sporadically.
  • Reimbursement -- Overstocking wastes both product and money. Most payers barely reimburse beyond the vaccine’s cost, so any wasting nearly eliminates profit. Plus, if a vaccine is not covered by insurance, the patient must pay. Count on recovering less than 100 percent in these cases. New vaccines (Gardasil or Zostavax) are very expensive. There’s always a transition time between patient demand and insurance reimbursement. In the interim, billing is a challenge.
  • Complex scheduling -- This is especially true for pediatric vaccines. The schedule is constantly changing, and new combinations come out regularly. Keeping up with what is due for any given patient is challenging.
  • Documentation -- Most states now keep a vaccine registry for children. Practices must record immunizations in both their own records and the state registry.
  • Compliance -- Although most practices want all their patients vaccinated properly, some patients and parents balk.

While there is no way to overcome all these issues, you can still improve the chance that reimbursement will be higher than cost by:

  • Negotiating -- A small increase in reimbursement for a vaccine will calculate to a big difference when applied to your total population.
  • Pre-authorizing -- Check insurance eligibility before administering. If a patient is not covered, then ask for payment up front.
  • Coding properly -- Administration fees are generally paid for; therefore, they should be charged nearly all the time. You can also charge for counseling patients who want more information about the vaccines.
  • Documenting -- This is necessary for both coding properly and saving time in the future. Support your billing for counseling with the associated medical record. And, a well-documented immunization record will make it much easier in the future to efficiently and accurately give vaccines when needed.
  • Capitalizing on opportunities -- Even with small profit margins, higher volume will yield a higher profit. This means that whenever a patient comes to the office, note whether he is due for an immunization. If so, offer it.

Robert Lamberts, MD, is a primary care physician with Evans Medical Group in Evans, Ga. He is board certified in internal medicine and pediatrics, and specializes in the care of adults, pediatrics, diabetes, high blood pressure, asthma, preventative medicine, attention deficit disorder, and emotional/behavior disorders. He serves on multiple committees at several national organizations for the promotion of computerized health records, for which he is a recognized national speaker. He can be reached at rob.lamberts@gmail.com.