Practice Management Alert

Underpayment by a carrier is all too common, but never fear -- there's something you can do about it!

You can win: Beat underpaying third-party carriers at their own game simply by keeping all your fee schedules on file, says Annissa White, president of Healthcare

Management Consultants & Supply in Millburn, N.J. To identify and appeal underpayments, White recommends this simple, four-step trick:

1. Call and request the fee schedules from each of the insurance companies you contract with.

2. Set up a notebook that separates the fee schedules by specific carrier names (for example, Aetna Commercial and Aetna Managed Care will each have its own schedule and section). This notebook will provide you with an easy reference anytime you suspect an underpayment.

3. Compare what you actually got paid for a service against the contracted fee, so you can easily identify when a carrier pays you less than they're supposed to.

Note: Read your explanation of benefits carefully for provisions or mistakes that could cause underpayment.

4. Appeal underpaid claims by sending a copy of the carrier's fee schedule along with your appeals letter. Carriers will have a hard time arguing with a fee schedule they sent you that's printed on their own letterhead.

A fee schedule notebook will arm you to fight underpayments because carriers have "given you proof for your appeals," White says. You'll pack an extra punch by sending a copy of the carrier's fee schedule to prove without a doubt that they underpaid you according to their own contracted fees.

In addition, White advises her clients to do the following at least once a year:

Identify underpayments by taking your monthly A/R report and calculating the amount you should have been paid by each carrier based on the fees listed in your notebook.

Check those totals against the actual amount you received, and the difference is your underpayments for the month. The results you get will clue you in on which carriers need to be watched most closely for underpayments. In addition, you may be able to discern which codes are most commonly underpaid.

Of course, not all underpayments are caused by a negligent or crafty carrier deliberately trying to keep part of your cash. A variety of coding, bundling and other policy rules may come into play. However, keeping an eye out for underpayments is an easy way to find money your practice deserves.