Filling the Payer Gap Steve Swanson, CPA Jon Thoms, CPA Accounting - - PDF document

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Filling the Payer Gap Steve Swanson, CPA Jon Thoms, CPA Accounting - - PDF document

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9/13/2018 Filling the Payer Gap Steve Swanson, CPA Jon Thoms, CPA Accounting Supervisor Partner Top 100 Top 100 CPA and business CPA and business consulting firm consulting firm in the U.S. in the U.S. (62nd out of 53,000+ firms!)

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SLIDE 1

9/13/2018 Honkamp Krueger & Co., P.C. 1

Filling the Payer Gap

Jon Thoms, CPA Partner Steve Swanson, CPA Accounting Supervisor

Top 100

CPA and business consulting firm in the U.S.

(62nd out of 53,000+ firms!)

Largest

Iowa-based CPA firm

*Accounting Today, March 2018

50 states

and thousands of U.S. cities served

Top 100

CPA and business consulting firm in the U.S.

(62nd out of 53,000+ firms!)

Largest

Iowa-based CPA firm

*Accounting Today, March 2018

50 states

and thousands of U.S. cities served

Jon Thoms, CPA

Partner

  • Over 20 years of experience assisting

independent medical groups in maximizing profits, analyzing and improving practice productivity and revenue cycle management

  • Works with various medical groups to

review, modify or create compensation structures for physicians and staff

  • Creates internal accounting and

reporting procedures

  • Establishes enhanced financial reports

specific to client needs

  • Review efficiencies within the financial

data to ensure accurate and timely reporting

Steve Swanson, CPA

Accounting Supervisor

  • Extensive experience in the following

industries: health care, retail, service, nonprofit, manufacturing, agriculture, warehousing operations, construction and trucking

  • Specializes in accounting, auditing,

general business consulting, management advisory services, corporate, partnership, individual and farm tax returns, financial planning, and internal auditing

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SLIDE 2

9/13/2018 Honkamp Krueger & Co., P.C. 2

Today’s objective

Use your own data to:

  • 1. Identify areas of improvement based on chargemaster
  • 2. Identify key revenue lines to target in contract

negotiations for higher reimbursement rates or other competitive advantages

  • 3. Monitor billing and collections from third party payers
  • 4. Understand how chart audits can improve your

collections

  • 5. Understand why patient collections at access point is

critical

What is payer gap?

Shortfalls in practice receipts as a result of…

  • 1. Insufficient charges
  • 2. Improper reimbursements
  • 3. Insufficient contract terms
  • 4. Incorrect billings and codings
  • 5. Patient collection problems

(Weak controls at patient access point)

What is payer gap?

Data analysis will fill the gap.

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SLIDE 3

9/13/2018 Honkamp Krueger & Co., P.C. 3

What tools are needed?

You will need…

  • One motivated employee
  • One practice management system
  • One license to Microsoft Excel
  • Basic Excel knowledge or ability to learn
  • One supportive owner or boss
  • Time to pull, analyze and report on data within

your practice

What is data analysis?

“Data is useless without

  • analysis. Analysis is

impossible without data.”

  • Anonymous

“Data is useless without

  • analysis. Analysis is

impossible without data.”

  • Anonymous

“It’s never too late to learn a new skill. That is, unless your employer needs someone who possesses that skill in your position right now.”

  • Anonymous

Report Running vs. Data Mining

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SLIDE 4

9/13/2018 Honkamp Krueger & Co., P.C. 4

Report running vs. data mining

  • It takes little skill to run a report and print
  • It takes thoughtful skill to extract report, test the

data, archive the information for future use

  • Printed reports are static and are difficult to

cross-check

  • Extracted data can be tested and tied to other

reports electronically

Report running vs. data mining

  • Printed reports are difficult to archive and

retrieve

  • Extracted data can be archived easily and

retrieved instantaneously

  • Printed reports are usually “canned” and based
  • n what someone else thinks you need
  • When extracted as data, reports can be

manipulated and specified to your needs

Report running vs. data mining

04-2016 05-2016 06-2016 07-2016 08-2016 09-2016 10-2016 11-2016 12-2016 01-2017 02-2017 03-2017 04-2017

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SLIDE 5

9/13/2018 Honkamp Krueger & Co., P.C. 5

Report running vs. data mining

04-2016 05-2016 06-2016 07-2016 08-2016 09-2016 10-2016 11-2016 12-2016 01-2017 02-2017 03-2017 04-2017

Starting with the basics

  • This table tells a story, but not the whole story

̶ Which report or reports were run to obtain these numbers? ̶ Are charges based on date of service or accounting date? ̶ Are payments based on date of service or accounting date? ̶ Are the variations in charges based on variations in volumes? Medical Practice Charges and Payments

Oct‐16 Nov‐16 Dec‐16 Jan‐17 Feb‐17 Mar‐17 Apr‐17 Charges $288,225 $228,605 $268,934 $260,916 $257,680 $268,425 $288,345 Payments $86,954 $83,214 $145,526 $250,818 $180,170 $181,070 $153,742

Starting with the basics

  • Written, step-by-step documentation to include reporting specs
  • Addition of kept visits and a mathematical control measure

automatically enhances the value of this report Medical Practice Charges and Payments

Oct‐16 Nov‐16 Dec‐16 Jan‐17 Feb‐17 Mar‐17 Apr‐17 Charges $288,225 $228,605 $268,934 $260,916 $257,680 $268,425 $288,345 Payments $86,954 $83,214 $145,526 $250,818 $180,170 $181,070 $153,742 Kept Visits 1,478 1,166 1,358 1,352 1,328 1,398 1,491 Charges per Kept Visit $195 $196 $198 $193 $194 $192 $193

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SLIDE 6

9/13/2018 Honkamp Krueger & Co., P.C. 6 Drilling Down

Drilling down / mining the data

Dt of Svc Proc Dt Name Pat Type Sv It Sv It Desc Unit Price Count Chg Amt Payer Name 01/03/2017 01/03/2017 Patient, Ima 99499O Chart Copy $0.00 1.00 $35.00 Self Pay 12/23/2016 01/03/2017 Patient, Ima Standard 99214 OFFICE VISIT, EST PT $240.00 1.00 $240.00 SISCO 12/23/2016 01/03/2017 Patient, Ima Standard 99214 OFFICE VISIT, EST PT $240.00 1.00 $240.00 Medicare Iowa 12/23/2016 01/03/2017 Patient, Ima Standard 99214 OFFICE VISIT, EST PT $240.00 1.00 $240.00 Blue Card Of Iowa 12/23/2016 01/03/2017 Patient, Ima Standard 99214 OFFICE VISIT, EST PT $240.00 1.00 $240.00 Iowa XIX AmeriHealth Caritas 12/23/2016 01/03/2017 Patient, Ima Standard 99213 OFFICE VISIT, EST PT $160.00 1.00 $160.00 Iowa XIX UHC Community Plan 12/23/2016 01/03/2017 Patient, Ima Standard 95811 POLYSOMNOGRAPHY W/CPAP, BILEVEL VENTILATION, $2,024.00 1.00 $2,024.00 Blue Card Iowa 12/27/2016 01/03/2017 Patient, Ima Standard 95800 HOME SLEEP STUDY, UNATTENDED W/SLEEP TIME $497.00 1.00 $497.00 John Deere Choice 12/27/2016 01/03/2017 Patient, Ima Standard 95800 HOME SLEEP STUDY, UNATTENDED W/SLEEP TIME $497.00 1.00 $497.00 Blue Card Iowa 12/28/2016 01/03/2017 Patient, Ima Standard 99213 OFFICE VISIT, EST PT $160.00 1.00 $160.00 BCBS Iowa 12/28/2016 01/03/2017 Patient, Ima Standard 99244 OFFICE CONSULTATION $452.00 1.00 $452.00 United Medical Resource 12/28/2016 01/03/2017 Patient, Ima Standard 95886 MUSCLE TEST, EACH EXT., COMPLETE W/NCV $236.00 2.00 $472.00 United Healthcare 12/28/2016 01/03/2017 Patient, Ima Standard 95911 NCV Studies, 9‐10 $825.00 1.00 $825.00 United Healthcare 12/28/2016 01/03/2017 Patient, Ima Standard 99214 OFFICE VISIT, EST PT $240.00 1.00 $240.00 Medicare Iowa 12/28/2016 01/03/2017 Patient, Ima Standard 99213 OFFICE VISIT, EST PT $160.00 1.00 $160.00 BCBS Iowa 12/28/2016 01/03/2017 Patient, Ima Standard 95886 MUSCLE TEST, EACH EXT., COMPLETE W/NCV $236.00 1.00 $236.00 GWH Cigna 12/28/2016 01/03/2017 Patient, Ima Standard 95910 NCV Studies, 7‐8 $700.00 1.00 $700.00 GWH Cigna 12/28/2016 01/03/2017 Patient, Ima Standard 99213 OFFICE VISIT, EST PT $160.00 1.00 $160.00 Medicare Iowa 12/28/2016 01/03/2017 Patient, Ima Standard 99213 OFFICE VISIT, EST PT $160.00 1.00 $160.00 BCBS Iowa 12/28/2016 01/03/2017 Patient, Ima Standard 95885 MUSCLE TEST, EACH EXT., LIMITED W/NCV $151.00 1.00 $151.00 Iowa XIX UHC Community Plan 12/28/2016 01/03/2017 Patient, Ima Standard 95909 NCV Studies, 5‐6 $550.00 1.00 $550.00 Iowa XIX UHC Community Plan 12/28/2016 01/03/2017 Patient, Ima Standard 99213 OFFICE VISIT, EST PT $160.00 1.00 $160.00 BCBS Iowa 12/28/2016 01/03/2017 Patient, Ima Standard 99214 OFFICE VISIT, EST PT $240.00 1.00 $240.00 Medicare Iowa 12/28/2016 01/03/2017 Patient, Ima Standard 99214 OFFICE VISIT, EST PT $240.00 1.00 $240.00 Iowa XIX Amerigroup Inc

Plans are part of networks

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SLIDE 7

9/13/2018 Honkamp Krueger & Co., P.C. 7

% Total Charges Network Charges 31.57% Medicare 3,974,117.22 29.10% Wellmark 3,663,168.50 17.91% United 2,254,237.20 4.32% UHC Medicaid 543,470.00 3.57% Amerihealth 449,498.00 3.19% Amerigroup 401,663.00 2.21% Aetna 278,561.00 1.22% Iowa Wellness 154,014.00 1.03% Iowa Medicaid 129,926.00 0.86% Patient Pay 108,202.45 0.71% Humana 89,533.00 0.56% CIGNA 70,055.00 0.49% Tri‐Care 61,889.00 0.44% QCCH 55,398.00 0.32% Health Alliance 39,907.00 0.21% Health Partners 26,173.00 0.18% Midland's Choice 22,176.00 0.16% BC/BS OOS 20,386.00 0.13% VA 15,800.00 1.82% Other 229,150.00 100.00% 12,587,324.37

Plans are part of networks

Total ties to summary report of charges for the year, also if you report gross charges on financial statements, should tie back. Doing so indicates you have a valid data set.

  • 78.58%
  • $9,891,523

Plans are part of networks

Total charges summarized by CPT code agrees to charges by network on previous page

  • 6 of top 24 codes are E&M
  • $3,651,623
  • 29%

CPT Charges % of Charges 99213 $1,298,240 10.3% J0585 $1,237,347 9.8% 95810 $1,231,285 9.8% 99214 $845,040 6.7% 99204 $844,130 6.7% 95811 $781,264 6.2% 96116 $705,900 5.6% 95909 $457,050 3.6% 99244 $399,116 3.2% 95886 $396,480 3.1% 70553TC $307,671 2.4% 64615 $281,849 2.2% 95910 $250,600 2.0% 95911 $224,400 1.8% 95811SN $182,160 1.4% J0475g $163,150 1.3% 99215 $160,531 1.3% 95819Off $152,625 1.2% 95810 OUT $148,630 1.2% 70553G $131,098 1.0% 95885 $120,649 1.0% 95908 $117,900 0.9% 95912 $112,320 0.9% 99205 $104,566 0.8% All Others $1,933,323 15.4% Total $12,587,324 100.0%

Utilizing your information for contract negotiations

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SLIDE 8

9/13/2018 Honkamp Krueger & Co., P.C. 8 Putting It All Together

Pay attention to your chargemaster

Code Dollars Charge

Medicare ($1,068,355) Wellmark ($1,256,865) United HC PPO ($681,064) United HC HMO ($227,021) Aetna PPO ($192,968) Aetna (Coventry) ($578,904) Midland's Choice ($656,091) 99285 $1,964,466 $398 $208 $343 $270 $250 $281 $291 $304 99284 $1,669,796 $192 $142 $234 $184 $170 $191 $199 $207 (Summarized) 99283 $1,085,368 $163 $74 $122 $96 $89 $100 $104 $108 Network 99291 $705,489 $582 $338 $557 $439 $405 $456 $473 $493 Charges 99282 $458,568 $73 $50 $82 $64 $60 $67 $69 $72 $1,256,865 93010 $298,069 $25 $13 $22 $17 $16 $18 $18 $19 $1,068,335 12001 $193,745 $263 $152 $251 $198 $183 $206 $213 $222 $908,085 12002 $199,888 $317 $184 $303 $239 $220 $248 $257 $268 $771,872 12011 $129,927 $320 $185 $306 $241 $222 $250 $259 $271 $656,091 25600 $100,255 $956 $554 $914 $720 $665 $748 $776 $809 $557,678 23650 $98,111 $734 $530 $874 $689 $636 $715 $742 $774 $474,026 10061 $70,544 $590 $342 $564 $444 $410 $462 $479 $499 $402,922 92950 $45,854 $872 $505 $834 $657 $607 $682 $708 $738 $342,484 31500 $29,805 $316 $180 $297 $234 $216 $243 $252 $263 $291,111 99292 $19,373 $272 $150 $247 $195 $180 $202 $209 $218 $247,445 23500 $12,593 $636 $369 $609 $480 $443 $498 $516 $539 $210,328 26600 $8,185 $857 $497 $820 $646 $596 $671 $695 $725 $178,779 92960 $5,320 $582 $338 $557 $439 $405 $456 $473 $493 $7,366,021 27786 $3,458 $696 $536 $884 $697 $643 $723 $750 $782

Pay attention to your chargemaster

Code Dollars Charge

Medicare ($1,068,355) Wellmark ($1,256,865) United HC PPO ($681,064) United HC HMO ($227,021) Aetna PPO ($192,968) Aetna (Coventry) ($578,904) Midland's Choice ($656,091) 99285 $1,964,466 $398 $208 $343 $270 $250 $281 $291 $304 99284 $1,669,796 $192 $142 $234 $184 $170 $191 $199 $207 (Summarized) 99283 $1,085,368 $163 $74 $122 $96 $89 $100 $104 $108 Network 99291 $705,489 $582 $338 $557 $439 $405 $456 $473 $493 Charges 99282 $458,568 $73 $50 $82 $64 $60 $67 $69 $72 $1,256,865 93010 $298,069 $25 $13 $22 $17 $16 $18 $18 $19 $1,068,335 12001 $193,745 $263 $152 $251 $198 $183 $206 $213 $222 $908,085 12002 $199,888 $317 $184 $303 $239 $220 $248 $257 $268 $771,872 12011 $129,927 $320 $185 $306 $241 $222 $250 $259 $271 $656,091 25600 $100,255 $956 $554 $914 $720 $665 $748 $776 $809 $557,678 23650 $98,111 $734 $530 $874 $689 $636 $715 $742 $774 $474,026 10061 $70,544 $590 $342 $564 $444 $410 $462 $479 $499 $402,922 92950 $45,854 $872 $505 $834 $657 $607 $682 $708 $738 $342,484 31500 $29,805 $316 $180 $297 $234 $216 $243 $252 $263 $291,111 99292 $19,373 $272 $150 $247 $195 $180 $202 $209 $218 $247,445 23500 $12,593 $636 $369 $609 $480 $443 $498 $516 $539 $210,328 26600 $8,185 $857 $497 $820 $646 $596 $671 $695 $725 $178,779 92960 $5,320 $582 $338 $557 $439 $405 $456 $473 $493 $7,366,021 27786 $3,458 $696 $536 $884 $697 $643 $723 $750 $782

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SLIDE 9

9/13/2018 Honkamp Krueger & Co., P.C. 9

What’s the value?

Update and Monitor Your Chargemaster

Total Charges for this practice $7,366,020.00 Code 99284 Value of Charges Code 99284 1,669,796 Share of total Charges 22.7% Wellmark Aetna (Coventry) Midland's Choice Total Charges to $1,256,865.00 $578,904.00 $656,091.00 x 22.7% x 22.7% x 22.7% Estimated Dollar Value of Charges $284,917.52 $131,231.19 $148,728.64 Charge per Chargemaster $192.00 $192.00 $192.00 Estimated encounters 1,484 683 775 Allowed per contract $234.00 $199.00 $207.00 Differential - "left on the table" [$42.00] [$7.00] [$15.00] "Cost" of underbilled charges $62,325.71 $4,784.47 $11,619.42 above is 9 months - need to annualize $83,100.94 $6,379.29 $15,492.57 Total Value - 1 code affecting 3 networks $104,972.80

Charging 300% of Medicare reimbursement rate of $142 would be $426 and would easily capture full reimbursement value

  • f each.

What’s the value?

Negotiating a Better Deal Total Charges $7,366,020.00 Dollar Value of Charges of Top Code 99285 1,964,466 Representative percentage 26.7% Charge for Code - Per Chargemaster $398 $398.00 Wellmark Reimbursement $343.00 UHC PPO Reimbursement $270.00 Difference Between Wellmark and UHC $73.00 Increase of $73 as a percent 27%

What’s the value?

However, what if you can negotiate an increase

  • f $30 to $300?

This represents an increase of 11% $300.00 Total UHC PPO charges $681,064.00 Code 99285 share of total charges x 26.7% Estimated dollar value UHC PPO charges for 99285 $181,635.00 Divide by charge per chargemaster $398.00 Estimated encounters 456 Value at current rate of reimbursement ($270 x 456) $123,219.73 Value at higher negotiated rate ($300 x 456) $136,910.81 Increase in receipts 1 code, 1 company $13,691.08

Again need to extrapolate to 1 year $18,254.77

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SLIDE 10

9/13/2018 Honkamp Krueger & Co., P.C. 10

Filling in the gap

Reviewing and updating chargemaster $ 104,973 (1 CPT Code 99284, 3 networks) Negotiate reimbursements for largest volume codes $ 18,255 (Negotiate with UHC for an increase for 1 code)

Document, document, document

Perform Chart Audits

  • The 2017 National Physician Fee Schedule

Database lists nearly 15,000 codes

  • <1% of all codes are for E&M
  • Make up 18% of what is reported to Medicare
  • 28.4% of payments from Part B

Document, document, document

  • 2017 findings from Part B say, even still today,

9-11% of claims are in error:

– 64% due to insufficient documentation – 13% from coding errors – ONLY .3% IS FROM UNDER-CODING

  • And most of those were under-coded…due to

under-documenting!

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SLIDE 11

9/13/2018 Honkamp Krueger & Co., P.C. 11

Document, document, document

  • Major types of errors reported in chart audits:

– No documentation – Insufficient documentation – Medically unnecessary – Incorrect coding

  • Don’t have the time?

– Hire third party chart audit every year/other year – economical – Consider cost, energy, and time spent to defeat Medicare and insurance audits

Improve collections at patient access point

  • Higher deductibles
  • Larger co-pays
  • HDHPs shifting the burden of payment

Your patient is quickly becoming your largest payer.

Network Payments Medicare 1,091,326.89 18.00% Wellmark 1,989,930.73 32.83% United 865,111.81 14.27% UHC Medicaid 202,762.16 3.35% Amerihealth 170,989.18 2.82% Amerigroup 140,419.14 2.32% Aetna 61,378.66 1.01% Iowa Wellness 61,584.38 1.02% Iowa Medicaid 77,987.17 1.29% Patient Pay 1,074,391.06 17.72% Humana 13,336.56 0.22% CIGNA 39,056.10 0.64% Tri-Care 28,191.27 0.47% QCCH 21,383.81 0.35% Health Alliance 14,256.86 0.24% Health Partners 12,473.35 0.21% Midland's Choice 4,596.36 0.08% BC/BS OOS 9,730.33 0.16% VA 8,260.30 0.14% Other 174,382.03 2.88% 6,061,548.15 100.00%

Patient collections and AR

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SLIDE 12

9/13/2018 Honkamp Krueger & Co., P.C. 12

Improve collections at patient access point

  • Practices and policies that can be corrected

before or at the time the patient arrives at your reception desk:

– Failure to verify insurance and check for eligibility – Failure to secure preauthorization AND FOLLOW-UP CONFIRMATION – Failure to collect copays/coinsurance at the time of arrival – Inadequate focus on patient collections – Failure to satisfy demands of patient consumerism – the Modern Experience

  • “Give me a convenient way to pay”

Improve collections at patient access point

  • Work patient collections – collection realization
  • f receivables reaching the 90-day mark is only

about 30%

  • Check on patient deductibles, if deductible is not

met, insist on the payment up front

  • By not properly collecting patient responsibility

and working AR, on average, 40% of physicians fail to collect $31,700*

*Athenahealth 2016

Filling in the gap – adding it up

Reviewing and updating chargemaster

$104,973 (1 CPT Code 99284, 3 networks)

Negotiate reimbursements for largest volume codes

$ 18,255 (Negotiate with UHC for an increase for 1 code)

Chart audits (they were confident charts correct)

$

Patient access point – average from study

$ 31,700

Value of the Payer Gap:

$154,928

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SLIDE 13

9/13/2018 Honkamp Krueger & Co., P.C. 13

What tools are needed?

You will need…

  • One motivated employee
  • One practice management system
  • One license to Microsoft Excel
  • Basic Excel knowledge or ability to learn
  • One supportive owner or boss
  • Time to pull, analyze and report on data within

your practice

  • Patience and PERSEVERENCE

Questions? Thank you.

Jon Thoms

Partner I jthoms@honkamp.com

Steve Swanson

Accounting Supervisor I sswanson@honkamp.com P: 888.556.0123