7 Ways ASCs Can Increase Profits Quickly Without Additional Overhead
1. Understand the benefits of out-of-network. Many ASCs seek in-network contracts with insurance companies. However, insurance companies are profit-driven therefore these contracts are not likely to benefit the ASC long term.
"I have never come across an in-network contract that favors the ASC," says Mr. Maldonado. "Even if they believe they are getting a good deal, they don't have contracts from other ASCs to compare rates."
The perception of going in-network is that the ASC will be reimbursed quickly. The down side to that, however is that once contracted, the ASC must follow the insurance company's rules and fee schedules. Insurance companies are very good at delaying, underpaying, or flat out denying claims, says Mr. Maldonado. There are many profitable opportunities when billing out-of-network and companies like ANMM can help navigate the terrain.
2. Know the laws regarding health insurance claims. Health insurance claim laws can differ by state so it is important to stay informed. Federal laws, such as the Employee Retirement Income Security Act (ERISA) and the Patient Protection Affordable Care Act (PPACA) are in place to protect the patient, however few know or understand these laws and even fewer follow them.
"In many ASCs, the physician owners and administrators set up billing processes to conform to private health insurance company claim standards," Mr. Maldonado states. "However, if you are out-of-network, the rules you and the insurance companies have to follow are the state and federal laws. Insurance companies give a perception that ASCs must bill according to the insurer's rules, but that is not the case. There are specific legal procedures insurance companies must abide by to process claims correctly. ANMM has an internal law group (Lawyers) that submit claims. This process gives us a unique advantage to discredit unwarranted medical policies and ensure claims are processed according to the law."
3. Do not rely on insurance companies to provide accurate information. Do not depend on insurance companies to always reimburse claims correctly or provide factual information about a patient's plan benefits. For the best results, do the research yourself.
"There are occasions where I've seen claims denied because the insurance company said the patient didn't have out-of-network benefits, but when we analyzed the documents, they did," says Mr. Maldonado. "Always question what the insurance company says; don't take their word for it."
4. Educate patients on the billing process. Clearly educate patients about the billing process and what they should expect. Whether the claim will go in-network, out-of-network, or even self-pay, the patient should understand what they will be responsible for and when the payment is due. "At ANMM, we embrace a Socratic method of teaching. If you clearly communicate and educate the patient on what will transpire from the moment they show up at the ASC to the time when they receive the EOBs, the collections process will be easier," states Mr. Maldonado.
EOBs can be very misleading to a patient and tend to resemble a bill; when a patient receives an unexpected EOB or bill, they will call the physician's office or the ASC with their questions and concerns. It takes additional time and resources to deal with these issues, not to mention possible ill-feelings due to miscommunication. Effectively educating the patient will reduce unwarranted overhead expenditures.
"Some ASCs have liaisons that specifically meet with patients about their procedures and discuss payment responsibilities, among other things. Treat patients as if the ASC were a concierge practice and you'll get a much better reaction," recommends Mr. Maldonado. "The only person in the claims processing world that has any power is the patient. The patient is a client to both the ASC and the insurance company. If you can effectively educate the patients and use their legal rights when working with the insurance company, you can achieve appropriate reimbursement."
5. Embrace the new healthcare laws. While healthcare leaders were able to ignore the PPACA in the past, the time has come to face the changes and challenges head on. Despite the evolving political climate, healthcare reform will be implemented. Some initiatives have already been put in place.
"The next phase of healthcare changes is set to begin in 2014. I don't understand why administrators, physicians and anyone involved in the profitability of an ASC is not educating themselves on the law," says Mr. Maldonado. "Many physicians and administrators rely on their attorneys to educate them, but most attorneys don't know the most effective way to apply the knowledge to the ASC."
6. Revitalize the way you process claims. Take the knowledge you have about PPACA and update processes to optimize profit potential. "Oftentimes when I sit down with administrators, they have been taught one way their entire careers and when I come in with my process, it can be foreign to them," says Mr. Maldonado. "But even from one year to another, the medical world changes. The ASC must constantly re-evaluate their internal processes and never accept mediocrity."
Do not be afraid of change. Stubborn management or a leader unwilling to adapt may result in ASC failure. "ASC leaders must keep an open mind to new innovation and meet upcoming challenges constructively. If the leadership innovates and infuses their knowledge about laws and internal billing processes into the center, they will be successful and extremely profitable," says Mr. Maldonado. "The more profitable a surgery center is the better healthcare they can provide. I've seen a few ASCs that have profit sharing programs with employees and administrators, which creates a culture of hard work to provide great healthcare. Patient outcomes are better when ASC staff love coming to work."
7. Hire the right management team. Physician owners must hire a qualified business-minded administrator to lead their company innovatively, and place experienced people in staff positions to optimize claims management and increase profits. The success of the ASC is dependent on the practitioner to have a proactive mindset.
"ASCs are a business which must create profits, and you get what you pay for," states Maldonado. "If you hire an individual without a formal business education or a passion for forward thinking, it may cost the surgery center profits. The successful ASCs hire to their weakness, and their weakness is the insurance laws and claims process."
If you can't promote an internal expert, consider taking on a management company or outsourcing your out-of-network claims management functions.
More Articles on Surgery Centers:
6 Recent ASC Acquisitions
5 Strategies for Effective ASC External Benchmarking
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