The Never-Ending Battle for Timely Reimbursement

The Never-Ending Battle for Timely Reimbursement

BY CARYL A. SERBIN, RN, BSN, LHRM

The procedure is over. The operative note dictated. The claim sent electronically within 48 hours of the procedure. Everything seems to be moving toward collecting the reimbursement in a timely manner. Then it happens ... an Explanation of Benefits is received with no check attached. The third-party payor tells us they can find no patient with this identification number in their database. In most cases, this means you must re-file your claim. This is just one example of what most billers and collectors deal with on a daily basis.

We’ve all heard the term “days in A/R.” This is a measurement of the average amount of time a billed charge remains in accounts receivable (A/R) before it’s collected. Every day that a claim sits uncollected in your receivables, your center is losing money. Every collection attempt that must be made because of errors made by your center’s billing department or the payer’s reimbursement division, costs you money. Let’s use an example of a claim sent to a payor whose contract indicates they are to pay 80 percent of billed charges. Billed charges were $5,000; this means the payor owes the center $4,000 (provided the patient has paid co-payment and deductible). Average hourly wages, benefits, and supplies cost the center approximately $5.59 per 15-minute interval multiplied by each person working the claim.

In this example, the payor waits the full time allowed by the contract to send a denial (45 days). This means that the collector has already followed up one or two times before the denial is received. Whatever is needed is corrected and the claim is resubmitted. Another 45 days and two more follow-ups go by before payment is received. This means that there were five or six attempts at collecting this reimbursement at a total approximate cost of $27.95. This does not include the 45 days of lost interest in your money market account which amounts to approximately $12.54.

This total expenditure for just one overdue claim amounted to more than $40. This claim was only 45 days late; think about how much a claim that is still outstanding after 90 or 120 days has cost the center. Multiply that by an average of 50 denials per month — the cost of collections is significant.

To try to make collections a shorter and more economic process, we have compiled a collection of collection hints; some are pre-surgery or pre-billing, others are post-billing and still others are post-denial.

1. Financial education or counseling of patient’s pre-surgery, including collection of co-payments and deductibles, is an important part of the collection process. All collectors know it’s usually easier to collect these monies upfront than it is after the fact.

2. Check and recheck the following before sending your claim:

• Proper spelling of the patient’s name
• Name on claim is the same format as on insurance card, including middle initial
• Accuracy of identification number including prefix, suffix, etc.
• Correct claim address
• All necessary information included on claim, including special payor-specific requests
• Invoice or operative note is attached, if applicable

3. Start follow-up process 15 to 30 days after claim submission. Use a manual or computer “tickler” system. During the first 60 days, follow up twice per month.

4. When following up, try to reach a “real person” and request reason for delay, request processing time, get a definite payment date.

5. Know your state’s rules on prompt payments and remind the payer when necessary.

6. Touch all accounts at least every 30 days.

7. Call delinquent accounts by payor. This allows the collector to make one phone call to discuss all outstanding claims with that payor regardless of age.

8. Promptly send additional information if requested.

9. Document in detail.

One of the most important tools in collections is a denial log. Every denial received should be recorded in the log in the appropriate category. This helps you determine trends, either yours or the payors, and make corrections. It also allows you to pinpoint where employees may need reinforcement or education. Some categories you may want to include are:

• Wrong patient information — name, ID, date of birth
• Form errors — insurance company or ASC
• Clearinghouse errors
• Wrong insurance, network, claim office
• No pre-authorization
• Non-ASC procedure
• Non-coverage, benefits expired
• Coding error
• No accident information
• Additional information

Every collector is aware of the importance of reports on your accounts receivable. Measure the A/R by payor, physician provider, specialties, and age, and analyze for trends such as timely filing, timely reimbursement, etc. These reports can indicate areas where you may not realize you are having problems. For instance, increased non-payment by a specific payor may reveal they are having computer problems; non-payment of implants may be carrier- specific or procedure-specific and indicates an area that needs to be followed up. There are so many reasons and non-reasons for non-payment or wrong payments on claims, the list is almost endless. However, the cost of collection is a formidable one and every effort must be made to try and curtail these expenses. Hopefully these hints will assist you in this endeavor.