Managing receivables starts with the contract
Managing receivables starts with the contract
Know what you are supposed to be paid
Successful management of accounts receivable (AR) starts when you negotiate a contract with a payer, says Elizabeth Woodcock, MBA, FACMPE, an Atlanta-based consultant with the Medical Group Management Association (MGMA) in Englewood, CO.
"The AR process doesn’t start with the insurance follow-up clerk. It starts with whoever signs the insurance contract. It’s important to start looking at [AR] from the beginning," she says.
If you don’t know how much you’re supposed to get paid, you won’t know when you aren’t paid the proper amount, she points out.
For instance, Woodcock says she worked with one practice, which had a carrier that automatically downcoded a particular procedure. The practice didn’t catch it for a while because it wasn’t on top of what should have been paid. "It happens all the time. People don’t know what they are getting paid or how much they are supposed to get paid," she says.
If a physician agrees to a health plan contract, he or she needs to understand the terms of the fee schedule, the reimbursement rate, and whether the fees are high enough to cover the costs of each procedure, advises Dan Steck, director of the MGMA Consulting Group.
A group should frequently review its explanation of benefits to see what the health plan has paid and compare it to the fee schedule. "Health plans have so many different contracts and pay schedules that they may be paying a practice less for some things and more for others," he says.
If a discrepancy occurs, it’s probably due to a complicated system, rather than an outright attempt to underpay you, Woodcock says.
Remember that at insurance companies, one group negotiates contracts while an entirely different group adjudicates claims, and their communication may not be good.
If the claims adjudicators don’t know the terms of the contract you negotiated, they’ll pay you what they pay everybody else, a procedure that could shortchange your practice, she adds. That’s why you need to keep a close tab on any mistakes they may make, Woodcock says.
Many practices complain that insurance companies won’t give them the information on how much they are supposed to be paid. If this is the case, make a list of your top 20 codes and request information about those from the insurance company.
Insurance companies that won’t send reimbursement information on all 7,500 CPT codes will give you information on a limited number, Woodcock says. "Most practices can capture 50% of their revenue stream in 20 codes."
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