Insurance Claims Problems in Medical Billing and Coding

Novel Solution to an Age Old Problem in Medical Billing
The Setting:

The Merit Orthopedic Clinic (name changed for privacy) is a major Center for Orthopedic Care and Emergent Orthopedic Procedures in the outskirts of Atlanta, Georgia. What began as a single-physician practice blossomed into a highly respected name in a very short period of time on the basis of the excellent quality of care and also empathetic post-procedure services. The aging in-house Medical Billing team had always been efficient in making sure the myriad papers claims were submitted on time and reimbursements realized within fairly reasonable time-limits. Thus, the clinic in the span of a couple of decades had 20 full-time orthopaedic consultants on its rolls besides the many locums and visiting consultants.

The Problem:

But dark clouds had started looming over the horizon of The Merit Orthopedic Clinic in the 25th year of their operations. The Federal pressure in matters of practices adopting EMRs and clinics going paperless had brought a sea change in the daily operations of the clinic. Although the clinic did its best in revamping its IT infrastructure, the end-users such as the doctors, Medical Billing/Coding personnel, The Appointment Desk etc, took to the technology fairly slowly. Empirical evidence over the recent years have proven without a doubt the efficiency and security that is there to be enjoyed in adopting newer technologies, but many relatively small and mid-sized practices still find it difficult to cross the nascent stage and go into the promised land beyond.

Like many a business whose day-to-day operations involved handling of a large volume of complex repetitive tasks, the clinic too started to outsource some of the processes like transcription and medical billing to various outsourcing companies. By doing so it did find better use for its highly competent and experienced administrative staff, who anyways were all too eager to let go of tasks that involved the newer IT solutions. Although on the surface everything seemed to be working as planned, the financial results apparently told another story.

The Problem in Detail:

Starting from 2005 (the year of the internal shifts); the financial statements seemed to record a dip in yearly profits by about 7%. This was not considered alarming in the first couple of years at least, since the clinic believed that capital costs for implementing the IT infrastructure was playing a hand here; but as the compounded rate of depreciation of profits continued in the 3rd consecutive year; the board members, which included many of the full-time consultants, became alarmed. Although it seemed unlikely, at this compounded rate of reduction of profits, the clinic was looking at itself going into the red and even staring at huge losses beginning 2015, since by then it would have surely expanded its operations even more, and would be operating on an even bigger capital and overheads expenditure.

The Analysis:

After some hectic analysis the financial experts, both within and outside the clinic, advised the board to have a relook into the operations of its medical billing and coding department. They were pretty sure that something was not right there. It was then that Merit approached Billing Paradise, a revenue management expert in the medical domain. The Billing Paradise Team, as is their norm, had its certified billing consultants pore over the claims submitted by the clinic over the last 3 years.

It also went over the aging reports submitted by the outsourced medical billing vendor that Merit was employing. It was not long before they realized that this other company was not as dedicated as it should be in the following up of old claims, even the high-value ones. As it so happened the physicians at Merit did not utilize a superbill and expected their medical billing staff to glean that information from the medical records being dictated. This was not that complicated when the in-house team did the billing; but when transcription and medical billing/coding started to be outsourced to two different vendors, things became a bit awkward.

The Path to a Solution:

As the Billing Paradise team pointed out the medical billing vendor that Merit was using was obviously not entering the right codes in many instances of the claims submitted. This was more prevalent in complicated cases involving multiple surgeons and where the services rendered painted a complex picture. It goes without saying that these cases involved a huge dollar amount and their rejection and underpayments lead to a drastic reduction in the reimbursements secured from the insurance payers.

Billing Paradise was positive that even a better camaraderie between the clinic and the billing company would still be pushing many high worth claims into the no-pay zone, and suggested that they switch to a vendor who combined the dual capabilities of transcription and medical billing, and even suggested a novel solution as to how coding errors may be minimized in such a scenario.

The Solution:

It was the board’s unanimous decision in 2009 that both the transcription and the medical/coding processes be immediately offloaded to Billing Paradise, which had more than a decade’s experience in tailoring such solutions to more than 300 clients across the breadth and the width of this great nation. Moreover, this decision could not have been anything but unanimous when Billing Paradise went out of the box and suggested that the physicians dictate their CPT codes at the end of their dictations, and thus the ambiguity mentioned earlier is removed from the picture.

Billing Paradise also provided all the physicians in the practice with Olympus DS-5000 dictaphones completely free of cost, whose state-of-the-art functionality made the physicians linger on a bit longer to dictate those CPT codes. This combined with the proven A/R capabilities of Billing Paradise eventually enabled The Merit Clinic in reversing the disconcerting financial trend in 2010, and now are indeed well on their way to doubling their profits. In the words of the Chairman of the Board, “Frankly, we were not sure if the HI-TECH Act and the entire paperless office debate was doing us good or harm.

Although we did see the rationale in the outsourcing of non-core functions, we did not realize its full potential in positively affecting our bottom line until the advent of Billing Paradise.”