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Providers reassign Medicare and other third party benefits all the time. That is, they hand over individual provider numbers so that their employer entity can use it to bill and be paid for services rendered. Sounds like a perfect arrangement doesn’t it? 

However, this is often completed as a matter of course without much thought to the implications of the power being bestowed on the employer. The physician can be found responsible for inappropriate, abusive or fraudulent billing if they knew or should have known the services being billed were inappropriate.  Do you know what you employer organization billed as having been rendered by you? 

On February 8, 2012 the OIG (Office of Inspector General) issued and alert that warned providers to be cautious about the organizations to which they reassign benefits. Medicare generally prohibits reassignment of benefits but a physician-employer contract is an exception to that prohibition. The OIG cautions that although the billing entity is responsible for any overpayments resulting from inappropriate billing, the physician has culpability as well. 

According to the reassignment agreement as written by Medicare, the physician or the supplier of the service MUST have unrestricted access to the claims information submitted by the entity. That puts the burden of monitoring squarely on the physician’s shoulders. Physicians are expected to, obligated to, monitor the services that are being billed under their reassigned provider number. 

While the examples in the OIG Alert seem extreme, the simple fact is, these providers did not monitor what was being billed out as having been rendered by them or under their supervision. What structure do you have in place to mitigate the risk associated with incorrect, inappropriate, or even fraudulent billing? Physicians must proactively monitor claims. 

Read the Full alert from the OIG here: http://oig.hhs.gov/compliance/alerts/guidance/20120208.pdf

As everyone by now knows, there are serious issues facing the Community Health Center community.  These include declining budgets at both the local and federal levels, rising numbers of uninsured patients and increased scrutiny of the Medicare and Medicaid programs due to fraud and abuse.  The list of concerns for some CHCs unfortunately could fill a small book.  However, one which needs to be discussed imminently is the recent change in claim submission format v5010 and possible cash flow implications due to denied claims.  We have heard from a number of CHCs on the issue with a wide range of responses. 

The v5010 transition (i.e., the move from v4010 to v5010) has been well publicized and providers, including CHCs, had a significant amount of lead-time to prepare.  Every claim submitted to Medicaid, Medicare, and commercial carriers should be sent electronically in this new format.  Although minor differences exist, the claim data submitted to Medicaid in one state is quite similar to those submitted in another state.  The information included in the claim includes patient information, diagnosis code, procedure code, fee charged and sufficient accompanying information which allows the payer to pay or deny the claim.  The v5010 transaction set changed the format of this information from what had been sent for years.  For example a claim in this format resembles columns in a spreadsheet.  With the 5010 change, many of the columns contain new information or tweaked the old format.  Sound confusing?  It is. 

Good news – CMS extended the deadline for enforcing this change.  Although some CHCs have experienced cash flow issues since January 1, the majority have not.  Its time to ensure your organization has completed testing and communicated with essential parties (billing systems vendors, electronic claims clearinghouses, payers) to avoid unnecessary delays in payments.  For more information direct from CMS, see the following link: https://www.cms.gov/Versions5010andD0/V50/list.asp#TopOfPage. 

As discussed the CMS extension expires as of March 31, 2012.  Time is of the essence!

Another year and another change with most recently updated Federal Poverty Level (FPL) guidelines. It’s not so much that the guidelines have been updated as it happens every year. What is really challenging is implementing the guidelines AND enforcing… wait, maybe creating and THEREAFTER enforcing a policy for verifying patient income and assuring “risk avoidance” for Payer of Last Resort (PLR). You see even if your practice management software has the ability to automatically calculate a patient’s FPL, like all things in information technology (IT)… it is only as good as the data entered. AND, the data entered has only as much integrity as the person who captures it… this does assume s/he has been well trained on the process, right? 

When PMG asks CHCs across the country “How often do you update a patient’s FPL determination?”  The answer is usually “annually” or “once per year.”  But what if you see a patient in December of 2011 and that patient frequents your CHC a dozen or more times during the first half of 2012… well in advance of their one year anniversary of 2011′s FPL determination.  Several thoughts rush to mind: 

1. Is the patient still obtaining a discount for being at 125% of poverty with your CHC?  But what if the increase in the 100% of poverty income ceiling results in your patient now being at 100% of poverty because his/her salary did not change?

2. Is the patient still on Medicaid with no other insurance? You won’t know if you don’t check a pay-stub to see if s/he is having any money removed from his/her paycheck for benefits… in PMG’s mind, this opportunity alone makes pay-stubs the preferred (if not exclusive) option for income verification.

3. If the patient says s/he has no other insurance (or even if they do) are you having EVERY patient sign an affidavit to attest that they have no other insurance… this is “Payer of Last Resort (PLR) Risk Avoidance” in action. 

Many CHCs don’t have a formal, written policy for income verification, never mind PLR. In the end, if (when) you get audited, the policy and demonstration of its effectiveness with patient attestations… these may be your only defense.

Community Health Centers promote and expand access to high quality primary health care to an underserved population. To do that, CHCs must constantly break down financial barriers to that care. How do we do that? Our insured population is protected through our contracts with the payers. Our patient population with  income less than 200% of the FPL is protected by our HRSA mandated sliding fee schedule. What about the ‘tweeners? The patients  that fall between those two groups. They are the uninsured or underinsured who are not eligible for the slide. PMG has consistently recommended a prompt pay policy. This policy allows for a payment at less than the usual charge amount if the patient or entity pays on the date of service. 

One argument has been that we can’t do that because we have to charge everyone the same amount for a service. That is true, we must charge the same amount. How do we make that work and still give prompt pay discount? This prompt pay policy would not offer a lowered charge. It would offer an adjustment to the full charge amount…just like we do for our third party payers. 

Another argument has been that HRSA does not allow discounts to anyone above 200% of FPL. While I could give you my opinion on this, I thought a legal opinion was a better bet. We asked Adam J. Falcone, an attorney with Feldesman Tucker Leifer Fidell LLP, a well respected D.C. based law firm with decades of FQHC specific  experience. Here’s what Adam had to say: 

I learned that we don’t have a definitive answer from HRSA.  We have made the argument that this is not a discount issue – rather, it’s a collection policy.  We’ve demonstrated that having cash discount policies increase collections (basically, the minute someone walks out without paying, the chance of collection drops dramatically), so it maximizes reimbursement consistent with regulation.  HRSA has not officially weighed in yet one way or another.

We usually advise centers that have these policies that they do not have to change them until told to do by HRSA, provided that: (1) they can back it up re: increased collections; (2) the policy is approved by the board, on the record; (3) the policy is applied uniformly, and made known and offered equally to all patients; and (4) no one is denied care if they cannot pay upfront.  To that list, I would also add that the health center should be able to cover its costs even with the cash discount (on the assumption that its charges exceed its costs).  Lastly, I think we mean something broader than just cash.  Probably the health center would want to offer a discount for payment made on the same day regardless of whether it is made by cash, credit card, or check.

Consider a prompt pay policy. You may just discover that a collection policy that allows an account to be settled at less than the full charge amount may very well increase collections!

Without a doubt, there are few CHC topics which seem to generate as much confusion as the use of “locum tenens.” By definition, locum tenens is used to define a provider who temporarily fills in for a vacancy, vacation, or extended leave for another provider.  This definition is recognized primarily by Medicare (Section 30.2.11 https://www.cms.gov/manuals/downloads/clm104c01.pdf) and requires the claim to be billed using the NPI of the provider who is absent while appending a “Q6″ modifier on all HCPCS (e.g., CPT) codes. Medicare is perhaps the only payer with totally consistent use/definition of this term. Yet, we see CHCs use a VERY liberal interpretation of “locums” (e.g., billing under a medical directors’ NPI for new staff who are not yet credentialed or “on call”) for many commercial payers and, even more frighteningly, for Medicaid (straight ‘Caid and managed Medicaid). Remember, commercial and Medicaid payers use Medicare rules/regulations as a foundation but rarely follow them exactly. 

Any CHC attempting to utilize a locum tenens situation needs IN WRITING from each major payer whether A. they recognize locum tenens and B. if so, what billing requirements must be met/followed.  Aside from even inadvertent misuse falling under the definition of (at best) an “abusive coding practice or (at worst) a “fraudulent claim,” providers whose NPIs are used (much of the time unbeknownst to them) are at risk for being party to this false claim filing. PMG recommends all clinicians request (if not contractually obligate) their employer-CHC to provide reports (from the CHC’s practice management product) which clearly demonstrates which claims/services were billed under his/her unique NPI.  As an employed provider, you have a right to know. 

Another point worthy of mention, locum tenens works ONLY for Medicare Part B. Medicare Part A (for a CHC what we call it “encounter rate payment”) simply requires a 1099 or W-2 relationship with a “core provider;” i.e., the core provider does NOT have to be credentialed with Medicare to receive encounter rate payment. HOWEVER, most state Medicaid and commercial plans do require each unique provider to be credentialed so claims may be submitted under his/her unique PARTICIPATING NPI. This is not optional. 

Certainly we recognize that billing/finance may often be the last place to find out that a new provider (or even medical director) is hired. We just received notice from one of our clients that a new Medical Director starts Monday… we were told the preceding Wednesday!!  Even if this provider is FULLY credentialed with all the local payers before coming on board (and this is rare), just  reassigning their NPI for each payer is at least a 30 day process… and that is if there no issues.

In the end, know the rules and follow them. PMG’s basic recommended rule… each core provider should have his/her own NPI and it should be “participating” (i.e., uniquely credentialed) with all payers that require CMS-1500 (ANSI 837P) claims. If they have an NPI, USE IT!?!

Anyone familiar with CHC healthcare knows the front desk is a pivotal place. From patient reception to scheduling to phone calls to eligibility verification to patient placement… the list goes on. A significant risk area, and one that gets too little attention, revolves around compliance with Payer of Last Resort (PLR). PLR simply compels a CHC to be certain to bill third party payers in the appropriate order. For instance, a patient with Blue Cross Blue Shield (BCBS) who is also eligible for and therefore covered by Medicaid would see his/her claims go to BCBS first and Medicaid next. Makes sense, right? Why should our tax dollars (which fund Medicaid) pay before BCBS?  BUT, with many states offering easy to use presumptive eligibility options and CHC staff familiarity with state Medicaid, often only Medicaid or a grant funded program (e.g., Ryan White or Title X) is billed without ever even asking a patient if they have other insurance.  This is not only a violation of PLR BUT creates real liability for CHCs in the event of an audit. Remember, Medicaid is ALWAYS the Payer of Last Resort unless you see something in writing (preferably from an official source) stating otherwise. 

So who would audit?? And why?? State Medicaid is funded 50% by federal money and 50% by state funding. If you have a family planning waiver program (e.g., FamPACT in CA, TakeCharge in WA, PlanFirst in MI, etc.) it is 90/10.. 90% federal and 10% state. With budget shortfalls everywhere, growing numbers of agencies scrutinizing payments (e.g., Recovery Audit Contractors (RAC) hitting Medicaid 1/1/12, federal and state level OIG, etc.) never mind your staff who are looking for a Qui Tam (Whistle Blower) opportunity, let’s just say it’s not a matter of if your CHC will get looked at, but when. In the end if the feds try to recover from the state, the state goes after your CHC.  

What’s to be done? Add language to your financial statements, which should BEFORE EVERY VISIT be signed or affirmed by patients at the front desk.  An example of the language could be “By signing below I (or the patient’s parent/guardian) swear under oath that all insurance information has been provided and no other policy exists which would afford any payment/benefit for services rendered by [the name of your CHC].” Listen, some patients will withhold their commercial insurance because the co-payment is higher than Medicaid or they don’t want to pay out of pocket until they meet a sky high deductible.  They may also think your CHC does not take “real” insurance… do you post a list of accepted insurance on your web site or in the lobby??  Sometimes, they are just not familiar with their options. Also, many CHC staff simply assume that all of their patients have no money and no insurance… why else would they be at your CHC?!? Not only is this sort of thinking condescending and demeaning to your patients, it creates opportunity for unintentional yet ongoing violation of PLR. 

Remember the key element of an “effective” compliance plan, as set forth in the Federal Sentencing Guidelines, is to DETECT and CORRECT. We all make mistakes. Your ongoing responsibility is to find them and take corrective action.

Breaking News as of Dec 27th!!!  So the plan to implement a 1% raise was not approved and instead Congress passed a two month 0% Medicare rate increase for Jan and Feb of the coming year. In theory this might intimate their desire to truly fix the SGR vs. just passing the buck for another year. The numbers are staggering as this fix raises the planned 2012 (27% cut) encounter rate of $24 to $34+… in total it is a $33 BILLION fix. Not thinking there is a real way out in 2012 with the staggering deficit and tax issues with which congress is battling. However, as I said in my last post, even a modest raise is considered a win in these very difficult times. AND, remember to watch your commercial payers who pay you as a percentage of Medicare (e.g., 95% of Medicare). You must be certain they recognize this “stay” in terms of the 2011 fee schedule. I know commercial money is considered insignificant by some CHCs but the fact is that this is a portion of your 3rd party income that you and your billing team can truly impact (make lots more money)  if coding and billing systems are working optimally. Be vigilant, always.

So another new year and another delay in Medicare Part B adjudicating fee-for-service (FFS) claims. In fact, to make your life easier Medicare Part B will once again hold your claims for ten days to allow the US Congress to pass a “pay fix;” (see December 19, 2012 CMS Message 201112-39). Only in this market would we be thankful for a 1% raise but ONLY because a 27% decrease was averted!! Smart politics but bad business. Until the SGR is permanently rectified this problem continues ad nauseum.

Thankfully as a CHC, the impact is minimal in terms of actual payment. Certainly inpatient hospital, outpatient diagnostics (TC only), and carved out specialists will see a hit but encounter rate (Medicare Part A) compensation goes full steam ahead with a guaranteed increase… no congressional intervention necessary.  Only other snag are those pesky commercial payers who could implement a decrease in payment if they pay based on a percentage of the Medicare fee schedule but only use the schedule BEFORE the correction. Watch for this!

Now the only other challenge will be assuring 5010 compliance… BUT WAIT, perhaps you or one of your team saw a “Part B News” article discussing the delay of penalty imposition until the start of 2Q12 (i.e., April 1, 2012).  Don’t be fooled into thinking you can delay implementation at your CHC.  A number of payers already mandate 5010-compliance and even though government penalties might not hit until April, wouldn’t claim denials due to lack of 5010 formatting be penalty enough???

Avoid the madness and be 5010 compliant, ASAP. By now you should have cleared things with your practice management software vendor, your clearinghouse, and for the few CHCs submitting directly to any third party payers… you guys need to also verify that your claim files are meeting all 5010 standards.

 Happy Holidays and good luck in 2012.

How much do you make per visit? Seems simple. Next… how much does it cost you to see a patient? Hopefully less than you make. So much is made of KPI but in the end taking a look at something as simple as determining whether you make money on a per visit basis is an important place to start.

Simply take the total amount of money your CHC was paid and divide it by the number of patient visits it took to make that much money, for example $100,000 in payment for seeing 1,000 patients = $100 payment per visit, your encounter rate.

Actually, most CHCs just want to minimize how much they lose per visit. Without grants, a profit per visit seems unattainable. But is it? What happens if funding on which you depend just disappears? Not possible, how about universal health care? If we pay for that, what happens to 330 funding, Title X, Ryan White and other federal/state funded programs created to cover the uninsured… who are now insured…

We were asked to create a training for a group and the working title was “No Funding, Now What?!? What’s your CHC’s plan? Start with that measurement per visit across the entire CHC.

How about per clinic? Per provider? Per payer?

With this data, you can make better decisions about where to focus billing staff’s time and energy. AND, take a look at PMG’s chart below showing the average payment in your state. Are you above the rate?? Good for you… below? How can you improve!!

CHC Charges… something as simple as being sure to charge enough so as to allow payers to give you as much money as possible. After nearly fifteen years teaching revenue cycle, I’m still amazed to find CHCs who leave money on the table only because they won’t increase their charges…  “BUT THE PATIENTS WON’T LIKE IT…” that’s the battle cry for keeping pricing status quo. That’s nuts. With sliding fee scales and frankly, the willingness of almost every CHC I’ve visited to see patients whether they pay or not, why does anyone care whether you charge $1 or $100.

Sure you need to consider how much things cost, and of course you need to think about whether the price is reasonable compared to your market (and I know you have to explain things to HRSA) but honestly… most CHCs are so busy with other things that these considerations take a back seat time and time again. Getting around to setting charges is just never a priority. BUT, it needs to be.

Once year, like the tax man… just take the current Medicare fee schedule and multiply it times 1.5 or 2 or 3. ANYTHING but don’t just ignore it. Every CHC I visit needs money and something as simple as charging enough money for work provided should be a no-brainer.