Coding
and Compliance Checkups Essential for
Medical Practice Success
Proper coding
is critical for an efficient and cost-effective practice.
By Douglas
J. Jorgensen, DO, CPC and Brian Shaheen, JD
Practice
management is no longer just reserved for large multispecialty
groups. Small and large medical practices need more efficient and
cost-effective means to provide high quality medical care.
To do so, a critical evaluation of the workings of the medical practice must
take place to implement changes and updates.
Some practices may have the means to do such an evaluation and update internally.
However, an objective third-party observer may well be what the doctor ordered
to break old habits and optimize your practice’s efficiency and reimbursement.
This objectivity may be lacking with an internal audit alone.
The uniqueness of each practice demands a consultant or organization that can
meet your individual needs. However, it can be difficult to find one you trust.
To complicate matters further, many practices, specifically the providers,
are reluctant to look into potential areas of weaknesses.
The key focus of a practice management evaluation must be changing how one
approaches the practice of medicine and not the practice of medicine itself.
There are many means by which to obtain this focus.
Obtaining Focus
While some practices are in need of a start up company, others are seasoned
with veteran providers and long-term well-established patient relationships.
So-called start up companies should not be relegated only to new practices,
for that is usually only part of their expertise. Most are professional service
organizations that specialize in healthcare consultation spanning a variety
of areas.
Osteopathic family physicians can benefit from business plan development, financial
planning, fee schedule/RVU evaluation, compliance plan development, medical
record audits, recruitment of providers and/or staff, equipment purchases,
benefit plan management, contract development and possibly legal advice.
Business Plans
Outside the world of medicine, to start a business without a business plan
would be unheard of. However, business plan development is often not thought
of as requisite for many medical practices. Yet, strategic planning to determine
your practice’s goals and means to achieve those goals is critical to
your success. Your future success is built on the foundation.
A practice management company helps osteopathic family physicians focus their
efforts and possibly exceed expectations. Remember, assuming the practice is
a reputable, experienced company, they have the expertise to avoid pitfalls
and develop a plan that is pragmatic and eventually profitable for the unique
needs of the practice.
This plan should include fixed costs for the practice (i.e.: staff/provider
salaries, rent/mortgage, utilities, supplies, insurances, etc.) in addition
to projected expenses and capital purchases such as surgical or laboratory
equipment. The business plan would allow you to plan for those purchases and
give you a guide as to how you are doing at the six-month or even the two-year
mark.
The key here is to set reasonable goals and have both short- and long-range
planning within its scope. For those unfamiliar with such planning or daunted
by the concept of a de novo plan for their practice, a practice management
organization could help set up a plan and do a comparison to similar size practices
to help them gain perspective.
Financial Planning
Traditionally doctors have relied on self or family to do most of the business
matters in the practice. While financial issues in medicine are increasingly
more complex, family may still have your best interest in mind. However, the
approach might need to be adjusted or reevaluated. Financial planning in this
instance refers not just to retirement matters, but also to the fiscal vitality
of your practice.
Such planning would speak to the family physician’s ability to provide
(or to choose not to provide) certain benefits such as health, life or disability
insurance or even profit sharing with their staff, associate(s) and/or partners.
Only by preparing a systematic approach to the monetary aspect of practice
can family physicians expect to have options as to how to allocate the funds.
Through an analysis of procedures and office visits coded, accounts receivable,
collections, payment trends (broken down by each payor and your payor mix),
co-pays, etc. family physicians can project what their practice can hope to
gross and net each month, each year and so on. These numbers will allow the
practice to determine areas that need work as well as those in which they are
already doing well. One area that is not addressed often enough is fee schedule
adjustments.
Fee Schedule
Antitrust laws prevent practices from openly comparing prices for services
rendered. Fortunately, the Relative Value Unit (RVU) system and subsequent
demographic algorithms allow for uniformity within similar demographic and
regional make-ups. Since the RVU system levels the playing field, one would
expect that all doctors are charging the same for a 99213 or a 99244.
However, nothing could be further from the truth. A practice management company,
although due to confidentiality issues is unable to disclose what your competitor’s
fee schedule across town might be, usually has access to the updated RVU fee
schedule for your area and knows, on average, what fees are in the ball park.
Before managed care and federal healthcare reform, a doctor sent in a bill
and the insurance company paid them the charge. Yes, even Medicare! However,
I have seen many practices that only bill 70-80 percent of what the insurer
pays for the services rendered. In essence, this is giving away your care.
Furthermore, it makes those charging ‘appropriately’ (per the federal
RVU system) appear to be “over charging” for the same or similar
service. Remember the payor is going to pay what the contract stipulates or
what they deem “reasonable and customary.” If some of the insurers
do not pay the fee, the family physician has the option of billing a secondary
insurance or balance billing the patient. Contractual stipulations dictate
these relationships.
However, some practices are afraid of charging too much. In most instances,
the contract will not allow this to happen. What may in fact be happening to
these practices is sub optimal reimbursement simply because they did not seek
100 percent of what the payor reimburses for the service at hand.
Therefore, if the family physician is unsure, simply call the payors and ask, “what
do you reimburse for a 99243 or a 98927?” The answer might be surprising.
For family physicians that do not have the time, this would be another task
for their practice management company to investigate. They might even have
the answer readily available.
Compliance Plan Development
While this topic could easily encompass several articles, the purpose here
is simply that family physicians should have one. Compliance plans protect
and create less headaches and smoother running practices—if they are done
appropriately. Many practices do not have one due to the perceived difficulty
in creating one.
The AOA has done an excellent job in creating a “walk through” plan
specifically with privacy and HIPAA in mind. This is more of a ‘do it
yourself’ model and is very feasible and practical. However, some would
prefer to have this done by an outside entity just to get it done.
While the cookie cutter approach will cause trouble (a.k.a. buying a prepackaged
compliance plan just to say “yes, we have one!”), a consultant likely
has system that can be applied across the board and modified to meet the practice’s
needs. This is legitimate and could be cost saving in what the process detects
along the way not to mention the savings in potential fines that could be levied
down the road. Either means of getting a plan in place for a medical office
is fine, the point is it needs to be done.
Medical
Record Audits
Industry standards dictate twenty records per provider per quarter at a minimum
for medical record audits. The intent is to identify problems before they become
habitual and potentially discoverable via penal audit. Furthermore, if errors
are found where overpayment occurred, this gives you the opportunity to repay
the money voluntarily before there is a penal issue. The latter is unlikely
to happen, but the ramifications of such an event could be devastating.
As to who can do these audits, the recommendation is that they be done by a
competent, certified specialist. Many coding certifications currently exist
(i.e. Certified Professional Coder (CPC), Certified Coding Specialist (CCS)
to name a few).
In-house audits are fine as long as the review is objective. This can be an
issue for some practices and for this reason a practice management company
and/or consultant may be a better alternative. Be honest and objective in the
decision to outsource this or keep it in house. Quite literally, family physicians
potentially have everything to gain or lose in this review process.
The last several areas speak for themselves as to why a larger, more experienced
organization might be helpful to a medical practice. Recruitment of staff-
the screening, interviewing and hiring process can be very time consuming and
exhausting. Practice management companies can streamline this process and the
family physician can participate as much or as little as they would like.
In terms of equipment purchases, they have the experience, contacts, and volume
to possibly get the best deals available. State or national societies might
be of assistance here, but it usually costs little to nothing to ask, as these
resources are usually readily available.
The same goes for benefit plan management and the options therein as well as
contract development for new staff/providers and the subsequent legal advice
for these and other transactions. These services are often found under one
roof and can get the ball rolling on several issues with a single telephone
call. These companies can make the practice of medicine fun again and add real
value to the practice.
Another way to add value to the practice is through the use of the World Wide
Web, both as a general resource and as a targeted tool to research more discrete
issues. As a general resource, practices can use the web to keep their fingers
on the pulse of relevant developments.
Subscription to web site newsletters is one of the easiest ways to do this.
Many are free and quickly accessible (simply by checking your e-mail.)
As a more targeted tool, the web offers a number of options. Some sites offer
articles and question and answer exchanges on a variety of practice management
topics such as billing and collections, career, finance, legal and technology
related issues. Many also offer practice related “tools” including
hiring checklists, job description templates, sample policy and procedure pronouncements
and innumerable downloadable forms designed to increase management efficiency.
Unfortunately, as with physician practice management companies, not every web
site is as useful and reliable as the next. It is critical to distinguish between
the good and the not so good. Make sure the web sites visited present information
in a clear, organized format and are easy to navigate. Be cautious with sites
that present as nothing more than a market to sell their products and services.
Look for substantive information relevant to specific practice needs.
The ACOFP (www.acofp.org) and the AOA (www.aoa-net.org) web sites offer a myriad
of quality information. However, for the purpose of this section we explored
a few other web sites that stand out and offer the kind of resources that can
increase efficiency.
Aishealth.com provides a separate physician management section filled with
current articles on a variety of topics including marketing, pay plans, billing
and coding, compliance and physician compensation. A separate compliance section
pays particular attention to issues surrounding the implementation of HIPPA
regulations, key aspects of the Final Stark II ruling prohibiting physician
self-referrals, and compliance needs specific to individual and small group
practices.
Aishealth.com also offers a number of free e-mail newsletters. Notably, for
those interested in publications pertinent to practice management are MD Practice
Alert, Business News, and Government News. Simply log on to their site and
subscribe to begin receiving free weekly issues.
Another web site, physicianspractice.com, offers a number of helpful products
and services to physician practices. Like aishealth.com, it offers a database
of articles on a variety of practice management related topics including billing,
operations, finance, strategy, and technology.
The site also provides useful tools as well as a forum in which to ask questions
to practice management experts online. Downloadable forms addressing HIPPA
compliance, billing and coding and other issues provide good reference points
for developing practice specific forms and policies. Practice Management Pearls,
the web site’s free weekly e-mail newsletter, provides subscribers with
current features on issues affecting medical practices. Overall, the site is
well organized and easy to navigate.
While not specifically targeting physician practices, inc.com should not be
overlooked as a reliable information source for small practices. The web site
offers an extensive database of articles and advice concerning how to start
and grow your business. Articles cover topics including how to write a business
plan, choosing a corporate form, tax and liability concerns, federal and state
regulations as well as marketing and hiring employees.
The “discussions” category of the site provides a database of previously
asked questions supplying sound practical advice for individuals in the process
of developing a business plan. A convenient downloadable form library provides
sample contracts, policies, and checklists to assist practices in addressing
specific needs. While somewhat limited in scoped, the tools provide a starting
point for addressing particular problems and issues. Free subscription to newsletters
is also possible through the web site.
Summary
Whether utilizing templates from the web or other electronic media versus the
in person approach via a practice management organization your practice stands
to benefit greatly. The cost of such information could, by some parties be
seen as prohibitive for family physicians could easily spend thousands of dollars
on consultative services.
Yet, one-stop shopping, all at the cost of less than one full-time employee
with no need to pay benefits, makes this consultative option most appealing.
The issue really is how the practice would most benefit and to what extent
would such services duplicate those already in place. Each practice must answer
this question individually.
However, all practices are being held to certain federal and state standards
(not to mention the ever increasing private sector sanctions), many of which
are not voluntary in their compliance expectations. Therefore, choose your
information source carefully and wisely, but choose it none-the-less for without
some outside assistance you will likely find your practice playing catch up
in some very dangerous waters.
Douglas Jorgensen,
DO, CPC is a family physician with Manchester Osteopathic Healthcare
in Manchester, Maine. He is the newly appointed chair of the Osteopathic
Medical Economics Committee for the American Academy of Osteopathy,
a Certified Professional Coder, and founder of Jorgensen Consulting,
a national professional service organization offering educational forums
and coding consultation. He can be contacted via e-mail at ems@ctel.net.
Brian Shaheen, JD is a Contractual Consultant with Jorgensen Consulting,
LLC.
If you have any coding questions that you would like Dr. Jorgensen to answer
in upcoming Osteopathic Family Physician News publications, e-mail them
to the ACOFP
Publications Department.
