Practice Management Alert

Question: Our practice manager heard at a conference that we should be reviewing our individual payer fee schedules to see if we-re losing money on certain services our provider bills for. How should we do this? Plus, when we-ve done it once, how often should we reassess it? In today's medical economic climate, you need to find ways to ensure you-re billing and receiving every dollar your practice deserves while at the same time not overbilling your patients. If you-ve never done a simple analysis of your fee schedule, now's the time. Without a periodic assessment of your fees, you can't be sure you-re bringing in all the reimbursement you should be. Bonus: Analyzing your payer fee schedule will also help you determine which services are profitable for your office and which are not. For example, if you-re running an in-office lab and you find that you-re never fully reimbursed for lab services, you may want to switch to an outside lab. Tip: Your practice's fee schedule should be based on the costs incurred with delivering the services involved, says Barbara J. Cobuzzi, MBA, CPC, CPC-H, CPC-P, CHCC, director of outreach programs for the American Academy of Professional Coders in Salt Lake City. Watch for future articles in Medical Office Billing & Collections Alert on determining your cost of providing services to patients.
Quickly Assess Your Schedule Performing a thorough payer fee schedule assessment may seem like a daunting task -- especially since experts recommend doing an evaluation annually. Follow these five steps and your fee schedule reviews won't be quite as time-consuming and headache-inducing: 1. Identify the services your practice bills, ranking them from most frequently reported to least frequently billed. Enter the codes in order in a spreadsheet, listing all the procedure codes in column one. 2. List your current practice fee for each code in column two. 3. Fill in the reimbursement amount each of your contracted payers gives you for the codes in the subsequent columns. Use one column per payer. 4. Find the highest reimbursement amount, or maximum allowable, for each code from your payer data. List these numbers in the next available column. 5. For each code, compare your current fee to the highest allowable fee. Calculate the difference, and list that amount in the last column of your spreadsheet. For example, if your current fee for a procedure is $200 and your maximum allowable is $250, the difference is $50. That's $50 your practice is missing out on each time a physician performs that service for a patient enrolled with that payer because your fee is below the payer's fee schedule, Cobuzzi says. An easy way: If you take the top-20 codes [...]