Outpatient Care

MIPS impacts how doctors get paid. Are you ready?

The April 2015 signing by President Obama of the Medicare Access and CHIP Reauthorization Act (MACRA) effectively changed the healthcare game for individual clinicians working in physician practices. The MACRA legislation repeals the existing Sustainable Growth Rate (SGR) reimbursement formula and replaces it with a new Quality Payment Program (QPP) with two tracks: The Advanced Alternative Payment Models (APMs) and the default Merit-based Incentive Payment System (MIPS). A new Medsphere resource takes a closer look at MIPS, which will subsume existing EHR incentive programs.

While the popular misconception is that MIPS has replaced Meaningful Use, this is far from the case. How, then, are things different with MACRA and MIPS? The biggest change is that MIPS effectively alters performance measures for payment reimbursement related to EHR use as outlined via four categories:

  • Quality
  • Advancing Care Information (ACI)
  • Clinical Practice Improvement Activities (CPIA)
  • Resource Use

The Centers for Medicare & Medicaid Services (CMS) measures physician performance in each category and compares it to a predetermined national performance threshold. Data is then used to make adjustments to Medicare Physician Fee Schedule (MPFS) payments, creating incentives for those who score above the national threshold and penalties for those who score less.

Do you know what you need to know to ensure high scores, proper reimbursement and incentive payments? 

Click on MIPS to access Medsphere's resource and learn more about the new federal regime.

Are you ready for the oncoming wave of revenue cycle change?

A few weeks ago, I offered up 10 best practices for successful revenue cycle management. Any practice that implements these regular behaviors will be on a more stable financial foundation. The truth, however, is that things are changing rapidly in healthcare, which is news to exactly no one. So, on top of these 10 recommendations, you also have to manage changes that impact revenue. 

The impact of the Affordable Care Act (ACA) on the insurance market, for example, means deductibles and out-of-pocket expenses are going up for many insured patients, which increases the importance to your practice of collecting payment right after the patient walks in the door.

"The chance of collection drops by 50 percent once the patient is seen," Michael Orseno, director of revenue cycle management with Regent Surgical Health, told Becker’s Hospital CFO. "Focus on hiring competent staff to obtain the correct insurance information and collect out-of-pocket costs up front. It is worth every dollar to pay competent staff to collect every dollar you are owed."

As a HIMSS Revenue Cycle Improvement Task Force whitepaper explains, “Historically, healthcare providers … have designed their revenue cycle systems and processes around business-to-business (B2B) relationships  … with the shift in the marketplace to consumer-directed healthcare (CDH) and the 2010 signing of the [Affordable Care Act (ACA)], providers are now ill-equipped to efficiently handle the expected dramatic increase in consumer payments.”

So, how many dollars are we talking about as healthcare transitions from B2B to a focus on consumers? Potentially, enough to bankrupt many practices. The HIMSS Task Force predicted out-of-pocket expenditures would grow by 68 percent from 2007 to 2015 as the ACA gained traction.

According to medical markets research organization Kalorama Information, direct payments to providers by patients will continue to grow by about 9.5 percent annually and reach $608 billion by 2019.

The expectation is the technology will help make revenue cycle more efficient, but even if you have the technological tools to enhance revenue cycle management, remember that best practices and policies are the keys to making those tools work. The old adage holds here just as it does anywhere—technology + efficient, functional processes enhances function; technology + dysfunction just creates more dysfunction.

Adds Jeff Noonan, senior director for global services firm Alvarez and Marsal's healthcare industry group, "I've seen organizations that have great operations and great culture utilizing ancient technology, but they make it work. But, I have never seen bad operations make great technology work."

Another modern complicating factor is that both payers and providers are crossing over into the other’s domain. Providers are starting up health plans; payers are investing in provider networks. How will this alter the revenue cycle? We don’t know, as Carrie Pallardy explains in Becker’s Hospital CFO, which leaves physician practices with best practices as basically the only way to prepare for an unknown future.

If it seems like revenue cycle management tasks are sapping your practice resources, consider outsourcing, especially for coding and billing.

"As hospitals and physician practices grapple with intense pressure to optimize revenue cycle management processes, outsourcing has emerged as a powerful solution to the challenges of a rapidly changing healthcare model," said Black Book Managing Partner Doug Brown.

An experienced revenue cycle outsourcing team can perform activities like reviewing the payer mix and reimbursement profile for payers much more quickly than your back-office staff. For practice decision makers, detailed reports defining the insurance payer mix are invaluable when it comes time to make critical contracting decisions.

What you don’t need now is another layer of complexity on top of the numerous changes you already face. But revenue cycle management perhaps warrants more attention simply because more efficiency in this area pays for investments elsewhere.

Until healthcare in America becomes something other than a business, healthcare providers have to focus intently on the bottom line. If you put your practice on a firm but nimble footing, changes will seem more like gentle waves lapping at the shore than an inundating tidal wave.  

Mordy Pelleg is the founder and president of Medsphere's MBS/Net division, a proven provider of essential tools and services necessary to effectively manage physician practices. 

Are you leaving money on the table that your practice needs?

For clinicians working in the complex American healthcare system, getting paid for every single procedure, service and visit has always been something of a challenge. Yes, fee-for-service medicine created a fairly linear relationship between effort and remuneration, but even in that scenario many hospitals and practices have teetered on the edge of solvency, in part for lack of efficient billing practices.

Indeed, in a poll conducted last year by Cardinal Health, decision makers said reimbursement is the number one problem facing health systems today.

Now healthcare is moving toward a quality-based payment model that equates compensation with value, leaving fee-for-service in the rear view. Especially for organizations that struggled to bill comprehensively before, what might be the impact of this change now?

The truth is, we don’t yet know. As Carrie Pallardy writes in Becker’s Hospital CFO, “What healthcare revenue cycle management will look like once the value equation is finally deciphered remains to be seen.”

Still, the same practices and principles that applied to fee-for-service revenue cycle management will endure moving forward, even if they become doubly important. If you effectively bill now, you will be better prepared for future dynamic changes to the system.

10 basic revenue cycle best practices

  • Scheduling is the first line of defense and accurate demographics and insurance information are essential. Confirm that the patient has coverage and understands co-pays are expected at the time of service. Identify self-pay patients and make them aware of the payment policy.
  • Attempt to collect outstanding patient balances when speaking with the patient on the phone, or make sure they are aware that payment will be expected the next time they visit.
  • Designate a pre-certification and authorization lead staff member to obtain approvals for diagnostic testing or procedures to avoid denials and thereby loss of revenue.
  • Ensure accurate and comprehensive medical records to document billable services. From an insurance standpoint, if it’s not documented, it didn’t happen. EHRs, now commonplace amongst physician practices, help tremendously by lowering the duplicate patient record rate, which the Healthcare Financial Management Association says improves the accuracy of information.
  • Verify the capture of all billable charges, confirm that they are coded to the highest specificity, and bill patients in a timely manner.
  • Correct claim errors that create denials quickly and efficiently; even better, designate a staff member responsible for this task. If recurrent errors become a trend with a particular provider or staff member, make sure they are aware of the correct process or procedure.
  • Post payments in a timely manner to hasten the revenue cycle process. Use electronic remittances as often as possible and establish a threshold for small balances that are automatically written off.
  • Audit insurance follow-up reports to maximize reimbursement. Insurance companies have different timely filing restrictions; auditing this report will help avoid financial losses.
  • Monitor accounts receivable on a regular basis. Assign a staff member to review reports and establish benchmarks for the collection process.
  • Send patient statements on a pre-determined regular schedule. 

What you probably noticed is that the keystone of revenue cycle management success is effective communication. The frontline staff has to be gentle and caring, yet persistent, resilient and unyielding. Do you already have people on staff with strong personalities and the ability to communicate effectively without being abrasive? Build many of these best practices around those people and chances are good your revenue scenario will improve. 

Mordy Pelleg is the founder and president of Medsphere's MBS/Net division, a proven provider of essential tools and services necessary to effectively manage physician practices. 

Practice Management: Look for these 10 essentials when evaluating IT solutions.

If you’re looking for greater efficiency, effective operations and increased billing, practice management systems (PMS) are proven to meet those requirements.

But not all solutions are the same. If you’re shopping for a PMS, make sure you get the functionality that truly makes your practice better by looking for these ten characteristics:

  • Eligibility: You should be able to check a patient’s insurance coverage in real-time, on the spot, providing active coverage details for any date and place of service.
  • Multiple Billing Accounts: A patient may be identified just once in a PMS but could still be seen in the practice for different diagnoses attached to multiple guarantors. Make sure the solution enables more than one billing account for each patient.
  • Fee Schedules by Payer: Your PMS should be able to maintain a fee schedule, contracted or not, for any or all insurance payers of interest.
  • Claim Scrubbing: The ability to scrub claims prior to transmission to the clearinghouse will result in a higher first-time acceptance rate and faster claim turnaround.
  • Drilling Down: A robust PMS system will enable the ability to drill down through the data, allowing users to quickly access and retrieve needed information without having to open and close multiple forms.
  • Practice Messages: Information is essential to an efficient practice. Identify a PMS that gives you the ability to quickly disseminate messages to all system users.
  • Flexible Reporting and Exporting Capabilities: Yes, reporting tools are a must have, but those tools should also be flexible enough to group, filter and format on the fly and easily export to a third-party reporting tool.
  • HL7 Interface: Interoperability is a must to enable connectivity with hospitals, nursing homes, and labs
  • Payments/Adjustments posted on date of service: The PMS system should post all payments and adjustments for a specific service date, not just to an account balance. Services should be managed by date so that each service rendered during a visit can easily be billed, re-billed and released.
  • Automated RCM for Patient A/R: The ability to move accounts receivable through an automated revenue cycle management (RCM) tool is essential. Users should be able to view collection activity by the age of the receivable and payment criteria, and automate the collection process with notes and letters to the patient.

You can probably find PMS systems out there with more functionality than this set of core capabilities, but with each added bell and whistle the price goes up. Remember that the goal is to find a solution that improves practice efficiency and billing; at a certain point more functionality tends to overwhelm the user and detract from the very things the system is intended to enhance.

Balance your practice budget with the functionality you want and can afford, but make sure these 10 must-haves are included in chosen solution. 

Mordy Pelleg is the founder and president of Medsphere's MBS/Net, a proven provider of essential tools and services necessary to effectively manage physician practices. 

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