The Economy is Up. Reimbursments are Down.
We recently assisted a provider with setting their cash discounted fee schedule through ChiroHealthUSA (www.chirohealthusa.com) and in the process reviewed actual fees, regulated fees, contracted fees, and hardship fees. The doctor commented on the declining reimbursement he’d seen over the last 15 years in practice, despite the seemingly booming economic times. It was surely time to boost the over-the-counter, cash collection side of his practice.
He’s right. Insurance carriers and government programs have been squeezing every nickel out of reimbursement for some time. With Medicare, for example, under the PQRS, eligible professionals who did not satisfactorily report data on quality measures for the CY 2016 reporting period are subject to a downward payment adjustment of 2.0 percent in 2018 to their fee schedule. PQRS is now being replaced by the Merit-based Incentive Payment System (MIPS) under the Quality Payment Program (QPP). The first MIPS performance period is January through December 2017. Reimbursement for covered adjustments may be going down further if your practice didn’t participate in reporting.
How do Your Collections Stack up Against Your Costs?
As we approach 2018, it’s best practice for all providers to review their fee schedule and average reimbursement. Recalculate the practice’s “cost per visit” by dividing the number of office visits into total collections for the same period. If what you see gives you heartburn, take a deeper look into your actual reimbursement. Try this:
- In a spreadsheet, make a row for each of the codes you regularly bill, and a column for each of the carriers that you deal with. The first column should contain your actual fee for each code.
- Begin collecting the allowed (not what was paid) fee from each carrier for each code you regularly bill. Check out their published fee schedule or gather the data from paid EOBs. Fill in the corresponding cell for the code, under the carrier’s column.
- If you offer a legal cash discount, fill in a column for that fee schedule. How does it compare? If you find that you’re collecting more with cash than cumbersome insurance plans, consider beefing up your explanation of your ChiroHealthUSA fee schedule, giving patients the option of “going cash.”
Whether you complete this exercise yourself, or ask us to do it with you, it’s a critical piece of your business decision making as you head into next year. Adjusting where necessary will ensure that you keep pace with economic trends, your practice overhead, and the cost of living.
Check out our Practice Performance Profile and find out how we can offer a professional review of your practice’s statistics, reimbursement, code usage, and internal systems of reimbursement and compliance. You get rewarded for reading this far! Use code PPP20 to save 20%.