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4 Current Billing & Coding Issues for ASCs From Michael Orseno of Regent Surgical Health

Michael OrsenoAmbulatory surgery centers are no strangers to operating on slim margins, but as healthcare reform transforms the industry it has become even more imperative to operate under best practices and minimize the chance of any lost revenue.

Michael Orseno, revenue cycle director at Regent Surgical Health, shares four important billing and coding issues for ambulatory surgery centers to consider and master. 

1. Identify claims denials trends. Prompt, accurate billing — with attention paid to implants and bundled codes — will lead to a decrease in payer denials and Days Sales Outstanding. The first step to eliminating claims denials is reviewing the management information system’s (MIS) rejections and denials report regularly.

Common errors on the front-end of the billing process include inputting incorrect patient information such as the payer ID number and omitting patient information such as Jr. or Sr., which will lead to the rejection of claims. Incorrect use of modifiers is a common back-office issue which also gives rise to payer rejections. "When surgery centers get coding sheets back, someone needs to be mindful of procedure code modifiers. Payers use different modifiers for the same procedure, for example a -50 and LT/RT, so billers need to be aware of which payers require which modifiers," says Mr. Orseno.

Building custom edits in both the MIS and clearinghouse that will kick back claims prior to them being sent to payers is one strategy to decrease back office rejections. Regent centers use HST Pathways and ZirMed, a company that provides services to automate the revenue cycle process, both of which allow for custom edits. In order to prevent front-office rejections, management should implement policies and procedures the addresses the specific errors on the rejection report.

2. Verify patient insurance. Regent Surgical Health centers have collaborated with ZirMed. "Our centers are instantly able to verify patient demographics and payer information either individually or the entire day at a time in batch mode. A query is sent within HST Pathways and it brings back the payer information directly into the patient's chart. This has increased efficiency across the board in all of our centers," he says. "We estimate that this has saved about 10 to 15 percent of time, which allows our front office staff to focus on contacting the patient to review insurance information and arrange for payment of any out-of-pocket expenses."

2. Obtain proper procedure authorization. Many new procedures performed in ambulatory surgery centers require authorizations. More staffing and time is needed to obtain proper authorization, but doing so correctly is important. Even with the proper authorization, insurance companies do not guarantee payment. Mr. Orseno recommends always going through the process of due diligence and getting all of the necessary authorizations prior to surgery. While some companies will accept a retro-authorization, it's best not to leave it to chance and end up performing a procedure for free.

4. Prepare to handle increased patient deductibles. Ambulatory surgery centers often require an upfront payment for procedures, but Mr. Orseno points out that the upfront amount is often arbitrary and not always based on what the patient will actually owe. "When surgery centers do this they may end up spending an enormous amount of time at month’s end processing patient refunds. This staff cost often negates the increased revenue from up-front collections," says Mr. Orseno.

To avoid the expense of processing an increased number of patient refunds, Mr. Orseno suggests reviewing your payer contracts. A careful review will reveal how much reimbursement to expect for a particular procedure. If checked against a patient's deductible and co-insurance, which is determined during insurance verification, a more appropriate upfront payment can be set. A good revenue cycle specialists should be able to quickly calculate this amount and relay it to the patient. Though this process adds a couple more minutes of staff time per patient, it will decrease your accounts receivable thereby decreasing your Days Outstanding.

It may take time for patients to adjust to upfront costs. "Three to five years ago a $3,000 patient deductable was rare, but now we are seeing deductibles as high as $7,000," says Mr. Orseno. It is incumbent upon us providers to educate the patients if we want to succeed financially. Ten years ago patients winced at having to pay a co-pay upfront, but through effective education and communication, it's now a concept they are very familiar with. "I believe the same will happen with up-front payment of deductibles and co-insurance. It’s an uphill battle," he says, but patients are learning quickly.

More Articles on Coding and Billing:
Coding & Reimbursement for Spinal Surgery in Surgery Centers: Q&A With Carolyn Neumann
CMS Launches Web-Based ICD-10 Implementation Guide
ICD-10: The Coder's Perspective

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