Channel Sponsor - Coding/Billing/Collections

Sponsored by National Medical Billing Services | info@nationalASCbilling.com | (636) 273-6711

5 Tips for Collecting in Full From Out-of-Network Payors

Ambulatory surgery centers are at risk of losing revenue from performed procedures if the appropriate revenue cycle management principles are not performed and executed for out-of-network payors. Even if out-of-network claims are infrequent, ASCs can reduce their risk of denials or short pays by taking a few precautionary measures.

Ronald A. Duperrior, managing partner of Dallas-based Clarity Health, provides operational guidance to self-managed ASCs and their physician owners. He often handles out-of-network claims and has expertise for collecting reimbursements.

Here are Mr. Duperrior's five tips for successfully managing the out-of-network process.

1. Set reasonable rates. Problems can develop between ASCs and payors when a surgery center's charge master rate is too high. It becomes noticed and it is difficult to justify. Mr. Duperrior recommends knowing what is reasonable for your market and setting your rates two standard deviations away from the median or taking a multiple of what Medicare reimburses.

Payors know what others are submitting as charges within your geographical location, he says. If you are charging at an unreasonably high rate, you are asking for them to reject your claim because your rates are not customary and reasonable.

"It is not unreasonable to have your rates at the upper end of the scale," he says. "But don't be outrageously unreasonable. Two standard deviations can easily be justified. Perhaps your physician team is recognized with noteworthy accomplishments or has a unique education [or] your center has purchased equipment considered to be advanced technology … This is justifiable. Setting a charge master 10 standard deviations to the right is unreasonable, and you will be often challenged."

It's the responsibility of the surgery center to charge fair rates with a reasonable profit margin that does not exploit the patient or the out-of-network payor.

2. Know your rights. Each state has a state operating manual in which the state dictates to payors its insurance regulations. It's important for ASCs to know their rights according to the SOMs and to use those rights to their benefit, Mr. Duperrior says.

"If you are constantly getting denials for the same thing over and over, it may be an indication you are being harassed or payments are being unreasonably withheld," he says. "There are penalties involved. In some states [payors] will have to pay the full charge if they are wrong and delay payments."

When billers do not know their legal rights, they are more likely to be taken advantage of by payors. Citing state rules in appeals letters can also help leverage an ASC's ability to fully collect.

Always be on the lookout for improper delays or denials, Mr. Duperrior says. A surgery center knowing its rights and standing up for itself also means hiring qualified personnel to represent the center. "Know the rules; keep on top of [accounts receivable]," he says. "Have a strong billing system. Hire good people and pay them accordingly."

3. Appeal all denials. Surgery centers have a right to due process when it comes to disputes over submitted claims. It can be worth appealing a denied claim within 24 hours to maintain your due process rights, Mr. Duperrior says, which are forfeited if no appeal is submitted within an outlined timeframe.

"Even if I don't know how I will respond or I know my response will be weak, I will appeal to save the ASC’s due process rights," he says. "I appeal and personally reply to every one of them, depending on what the payor tells me and why they are [denying]."

Be firm and don't allow companies to use certain tactics as a justification for withholding money. "It may be give and take, but I hold my ground, and 90 percent of the time we come to a satisfactory outcome," he says.

He warns ASCs, though, to differentiate between being firm and being a bully. If centers start by charging unreasonable amounts and demand to be paid, they will immediately put the payor on the offensive and shut down opportunities for discussion.

"If I know the rules I'm playing by, I don't need to be aggressive," he says. "Be professional. Be reasonable. Be customary. I don't need to be aggressive because I'm right."

Most payors also have subcontractors to work with appeals and negotiations who are paid to reduce your bill. Try to talk to the same person every time and share with them why your charge is what it is. "Depending on the fiscal health of the center, I typically will not accept the discounts offered for a prompt pay,” Mr. Duperrior says. Consistency helps build a relationship.

4. Don't be talked down. Commercial payors are quick to negotiate your asking price down and they are good at it, but Mr. Duperrior says this can set a bad precedent for future transactions.

"Hundreds of people negotiate down," he says. "Third party payors will say, 'We'll pay quicker if you take less.' I stand firm by my price. A fiscally unhealthy ASC might take that deal because they need the money. The healthy ASCs will reject it because they can afford to wait a couple of days."

If an ASC accepts a low offer, then payors see this as a precedent and expect the center to always accept the reimbursement as it now has become and established, acceptable rate.

"If you can afford to do it," Mr. Duperrior says, "stick to your reasonably set charge master."

5. Begin your work before the procedure. ASC billers should not wait until after the procedure has been performed and the patient discharged to think about the bill. Verify insurance for each patient scheduled, identify what the out-of-network benefit will be and get authorization to do the procedure, Mr. Duperrior says.

Mr. Duperrior has encountered situations where the insurance expired between authorization and the day of surgery. For more expensive procedures, it can be worthwhile to verify the day of that the insurance is still valid.

"I understand you can't revalidate every procedure — it's an all day thing trying to validate and probably one in 300 procedures we see something like this happen — but if not done, it will make you mad if you get shortchanged on of the big cases."

Identify what needs to be collected prior to the day of surgery; call the patient and encourage them to stop in prior to surgery to take care of their co-pay and deductibles. Centers often wait and bill the patient later, but collecting up front can prevent losing money.

"Collect the co-pay and the deductible the day of surgery, if you can," he says. "Also have a verified credit check membership so you know there are funds in the account when you take the check, or take cash or credit card only."

Overall, ASCs should also keep an eye on weekly accounts receivable reports. Respond to denials quickly and don't always trust that the biller has already taken care of it, he says. A/R reports will verify the center is on top of all billings and appeals.

More Articles on Coding, Billing and Collections:
Will the Government Take a Bigger Role in ASC Billing Practices?
CMS: 9 Tasks Providers Must Complete to Prepare for ICD-10
AHA Counters Allegations EHRs May Cause Upcoding Fraud





Copyright © 2022 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.

 

Featured Learning Opportunities

Featured Webinars

Featured Whitepapers

Featured Podcast