The Lifecycle of a Medical Claim: Identifying Practice Problems

Have you ever stopped and counted how many opportunities for improvement your practice has when looking at the lifecycle of a single claim? I've counted 60. Yes, that many areas that can go really, really right, or really, really wrong. Some are at the clinic level, while others rest in the hands of your very capable billing company. Just one of these areas can delay payment for months!

In this article, we will touch on identifying practice problems within the lifecycle of a medical claim. By taking the much needed step back, your perception surrounding the business aspects of your practice will change significantly and for the better.

Let's start by looking at the activities related to the initial patient phone call who wants to be seen in your office for an appointment. Whether or not this is an established patient, or a new referral, this is a critical phone call. Did your office staff confirm the patient’s date of birth and spelling of their last name? Did they obtain all of the necessary insurance information required to verify eligibility and benefits? Have their insurance benefits changed since the last time you saw the patient?

How many times have you either had to turn a patient away once they took the time to get away from work, their family, or other responsibilities only to be told that their insurance will not cover the appointment? Perhaps it has played out differently, and you go ahead and take the chance, see the patient, only to find one to three months later that they are not covered under their insurance for the procedure, or codes you used? Based upon the patients insurance, you may or may not be able to pass that balance to the patient with hopes that they understand and will pay for your services rendered. Most often you are forced to write off this balance increasing your clinic error rate, leaving you unpaid for your time, and decreasing your business' value.

There is hope. By taking the time now to identify these potentially lethal areas, you can stop the bleeding out of your hard-earned money, and can start to realize the potential of your established business. It is more critical now than ever to find these weak areas. Insurance companies thrive on the ignorance of your office staff, and your billing company, regardless of how well they perform. They are making money off of your patients, and you.

Carve out a few hours and sit down with your staff. Go through every area internally where a decision is made regarding a single claim. Work on your internal procedures to ensure mistakes no longer happen. Do the training necessary for those who are not familiar with the procedures.

A few examples of areas you can look at today are:

• When information is typed into your software system, is there someone available to double-check the data entry? Oftentimes, even a small misspelling or mixing up numbers from the patient’s insurance card will get you a denial.

• Does your front office staff take a few minutes to explain the pre-verified insurance benefits to the patient? Is prior authorization needed? Let's face it, patients do not understand their benefits, and insurance companies are changing them up so often, it can get very confusing.

• Did your staff collect the co-pay, co-insurance, or deductible at the end of the appointment? This alone will increase your revenue overnight. You get to keep 100 percent of the money collected, rather than pay your billing company a percentage to collect what could rightfully be yours.

• Is the physician the patient is scheduled with on all of your practice's insurance contracts? Often times, you will find that a claim is denied or paid at the out-of-network rate simply because a physician is not on your contracts or certified through the insurance company. There are so many insurance companies that are adding very specific plans that do not fall under your current contract.

• Once the physician has seen the patient, you then need to submit codes to your billing department. Are the codes you are submitting payable by the patient's insurance company? Do you have a paid CPT spreadsheet by specific insurance company to see which code has the higher reimbursement? In most cases, you can increase your pay per visit significantly if you utilize a tool like this.

Starting with these five areas, you can easily and quickly see progress in your business' bottom line and for a minimal amount of effort. You owe it to yourself and your practice to start identifying.

Next week we will take a look at how you can evaluate your current resources in order to implement the necessary changes.

P.J. Cloud-Moulds runs Turnaround Medical AR Recovery, a consulting firm focused on helping physicians realize the potential of their private practice. She has nearly nine years experience identifying and implementing tested technique to turn around a company's bottom line. E-mail her here.