Where is Your Practice Losing Money? Part I

by Carol Hoppe,CPC,CCS-P,CPC-I

Having done thousands of chart audits, I am still amazed at how many times things are billed incorrectly resulting in lost revenue. It might be just a few dollars here and there, but it quickly adds up to thousands. If you have any type of surgery charges, it adds up even faster! In five years, that could replace the old copier or add an additional staff member to the practice. There are many areas where your practice could be losing money. Today, we will take a look at some of the most common areas. This will give you a chance to see what you find and put some ideas in action. In the next issue, I’ll have some additional tips on processes you can implement to ensure you are maximizing your revenue opportunities.

Uncollected Copays and Outstanding Balances

How much money are you collecting at the front desk? This is a critical part of the job. Front desk staff should be encouraged and incentivized to ask for money and collect it. If they are not comfortable asking for money, they are in the wrong job.
Collecting copays at the time of service is a requirement of your payer contracts. It is not optional. Collecting outstanding balances when the patient is in the office is much more economical than printing and mailing statements, opening and posting mail payments, or chasing down dollars with phone calls, collection letters or a collection agency. The longer the dollar goes uncollected, the less it is worth.
The best way to monitor this is to track and trend the percentage collectable from copays and outstanding balances compared to what is actually collected daily and monthly. Offer movie tickets to the person who collects the highest percentage each month or throw a pizza party for the front office if they reach percentage goals.


Missed Appointments

The practice only makes money when physicians see patients. They do not get paid for dictating or doing paperwork. If there are holes in the schedule, there is lost opportunity to generate revenue. No-shows and last minute cancellations can cost the practice hundreds or even thousands of dollars each week when the physician(s) could be seeing other patients.
Although time-consuming to do manually, reminder calls can save significant dollars throughout the year. Automated patient reminder calls, emails or text messages are readily available at a very reasonable cost from companies who offer this service. When you consider the number of missed appointments and the average revenue generated per patient visit, it is evident you cannot afford to leave things to chance especially when appointments are booked many months in advance. Offices need to be proactive, not reactive when it comes to missed appointments.

Non-covered or Unauthorized Services

There is no excuse for denials due to non-covered or unauthorized services in today’s healthcare environment. Many of the larger payers have online prior authorization tools available; there is no more waiting on hold for someone to answer your phone call. Urgent and emergency services can normally be authorized within 24 to 48 hours of providing care. Any time there is a reason to believe Medicare may not cover a service due to frequency or non-covered diagnosis, Medicare beneficiaries should be asked to sign an Advanced Beneficiary Notice (ABN) making the patient responsible in the event the claim gets denied. This is good practice to do for all patients with a form similar to Medicare’s ABN. Seeking authorization for things like surgical procedures and psychiatric services should be a routine part of scheduling.

Missed Charges

It is so easy to miss charges because of the constant interruptions that invade our space these days. Posting charges should be done in silence; but does such a place even exist anymore? I usually find at least one missed charge in every 10 to 20 charts that I audit. Sometimes it is a data entry error and sometimes it is a lab, venipuncture, vaccine administration or procedure that did not get marked on the charge ticket by the clinical staff or physician.
How many times do you draw blood, give vaccines and therapeutic injections, do EKGs or take x-rays in your office and never bill for them? They do not usually represent a lot of money individually, but are still worth a minimal amount of time and effort to capture the charges and recover some of the expense involved.

There are multiple ways to catch these errors:

1) Balance to “hash” totals. After posting charges, add up the CPT codes from each charge ticket (Example: 99213 + 99215 + 99204 + 36415 + 11700 + 99024 = 444,771). A good revenue management system will give you hash totals on your daily balancing report or some other report in the system. Ask your software company how to find this information. The beauty of balancing to hash totals is that if you do not balance, the difference between the two numbers should be the total of one or two CPT codes that you missed. From the previous example, if the report said 481,186 and you subtract 444,771, you know you have missed a 36415 somewhere. You can go through the charge tickets quickly and locate the one that was missed.
2) Reconcile the number of lab orders to venipuncture charges posted. If you submit 12 samples to the lab on Monday, you should have 12 units of 36415 billed that day. Compare test results to patient billing and make sure you have a charge for every result.
3) Track hospital visits by putting patients on the schedule when the hospital calls for a consult and monitor hospital visits until the patient is discharged. Provide physicians with a pad of forms for tracking hospital visits with appropriate codes to choose from and collect them weekly.
4) Put surgeries on the schedule and track surgery schedules to charges billed. Run reports weekly to make sure physicians are turning in their surgery charges and follow up until you get them.


Not Balancing Daily and Reconciling at Month-End

It might seem overwhelming, but balancing charges, payments and adjustments daily is a key to monitoring the success of a practice. There are lots of reasons to do this, such as discouraging employee theft, minimizing lost charges and avoiding inappropriate write-offs. But in order to manage and ensure the success of your practice, you need to be able to monitor and evaluate what is going on from month to month. Why are charges down this month? Did the physician take a vacation? Have they turned in all their charges? Or is there a stack of claims that did not get entered into the system, because they are buried under a pile on the biller’s desk? Why are payments down? Is it one payer or across the board? There are many reasons why payments can be low and you have to be able to look at trends over a period of months and years to see what is truly going on.

How would you know if your A/R is accurate if you are not reconciling YTD charges to payments received, adjustments taken and charges posted each month? Billers complain when they are not used to balancing adjustments. In one audit, I found a patient’s copay written off and a non-paid surgery charge written off by mistake while posting insurance payments. There was no documentation in the day’s batch to support the adjustments taken on several accounts sent to collections, but one account still had insurance payments pending.

It is a FACT: We are human; therefore, we make errors. They do not have to be intentional, they just happen. We get tired, the numbers are starting to blur on the screen, and we get a phone call from an irate patient who really ticks us off. It takes ten minutes to calm down and refocus. By then we cannot remember if we were done with the patient on the posting screen or not. Things like this happen all the time in a billing office. We have to check our work and balance every day.
If you are not doing these things now, you will be amazed at how frequently revenue is being lost every day. Multiply that by weeks, months and years to forecast what has been lost and, more importantly, what you can expect future revenues to look like with these processes in place. These are just a few of the ways you could be losing money in your practice. Watch for your next issue of Efficiency in Practice for more lost revenue opportunities.

Carol Hoppe, CPC, CCS-P, CPC-I is a consultant with MedLucid Solutions, LLC
To find out where your practice is vulnerable, contact Carol at (317) 537-7553 or carol@medlucidsolutions.com for a financial assessment of your practice.
Efficiency in Practice is the free eNewsletter for medical practice managers who want to save time, money and reduce risk. For more information and to access your FREE report, Patient Collections: It’s Make or Break for Many Practices, visit www.efficiencyinpractice.com
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Medicare Fee-for-Service Recovery Audit Program Appeals Update. (2012, June). Retrieved July 24, 2012, from Center for Medicare and Medicaid Services (CMS): http://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Recovery-Audit-Program/Downloads/Medicare-FFS-Recovery-Audit-Program-Appeals-Update-June2012.pdf

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