Medical Billing and Coding Healthcare Blog

May 9, 2011 - According to numerous surveys, doctors and hospital executives claim that payment collection for services rendered is quickly becoming one of the most important issues they face today. An overly complex system of rules, regulations and participants has forced many medical practitioners to invest considerable time and resources to payment collection. Managing the vast amount of paperwork related to billing, contacting patients regarding payment, and following up on unpaid claims from insurance companies has become one of the most distressing and time-consuming aspects of a physician’s daily routine.

In an effort to reduce the burden, medical practices and healthcare facilities ultimately make one of two choices: build internal medical billing capabilities at considerable expense or outsource billing related functions to a third party medical billing company.

Internal billing or in-house billing may appear to be an attractive alternative given the control issues associated with outsourcing, however close examination reveals limited results and higher costs in comparison to outsourced billing. These costs are not limited to the direct costs associated with staffing the internal billing organization and include costs related to management, turnover, training and growth.

Additionally the in-house billing model provides limited incentive for performance as salaries are paid regardless of payment received for services rendered or timely payment from date of service.

Outsourced billing on the other hand is typically the more attractive alternative given the direct incentive to perform as most outsourced billing companies are compensated as a percentage of collections. This payment scheme motivates the vendor who is 100 percent dedicated to the billing process to maximize reimbursement for the practice. Additionally, these fees are typically less than the cost of hiring staff given the economies of scale related to larger organization and the shared cost of technology.

In addition, as government and insurance carrier rules and requirements change
practices dedicate additional time and resources to staying abreast and adapting when required. Medical billing companies dedicate considerable resources to monitoring these changes and training their staff on how these changes will affect physician collections.

Lastly, third party medical billing companies typically provide practices a lower number of days in accounts receivable (the number of days required to convert billings into payment) in comparison to in-house billing staff.

This is achieved as a result of the scale and technology associated with larger organizations. For example, third party billing companies often employ claim scrubbing technology that reviews claims for known errors. Third party billing companies benefit from the knowledge of working for multiple practice and when errors are discovered in one practice, the knowledge from that error can be applied across the client base as a whole.

Outsourcing your medical billing to an outside professional medical service provider is often the most cost effect and highest income generating choice for practices. With Claim submission and payment collection in the hands of a well qualified vendor, physician practices have more time and resources to focus on patient care and business growth.

May 16, 2011 - There are many different kinds of Medicare fraud yet the goal is always the same – to rook money from the Medicare program. Generally Medicare fraud is challenging to track as not all fraud is detected and not all suspicious claims prove to be fraudulent. That is when Medicare abuse is in place. It occurs when physicians or suppliers fail to follow best medical practices, resulting in unnecessary costs to Medicare such as improper payments, or medically irrelevant services. In fact, Medicare fraud – estimated now to total about $60 billion a year – has become one of, if not the most profitable, crimes in America..

Significant decrease of fraud will cut costs for families, businesses and the federal government. Instead it will increase the quality of services for those in need of care. The U.S. Department of Health and Human Services (HHS) and U.S. Department of Justice are proactively cooperating to help eliminate fraud and investigate fraudulent Medicare (and Medicaid) operators who are cheating the system.

On January 24, 2011, HHS announced new rules authorized under the Affordable Care Act that will help prevent defrauding the Medicare program. These rules serve to protect patients and legitimate doctors as well as other providers. They include: enhanced screening and other enrollment requirements (rigorous screening process for providers enrolling Medicare in order to keep fraudulent providers out of the program), stopping payment of suspect claims (the program can temporarily stop enrollment of a category of providers or of providers within a geographic area that has been identified as high risk), new resources and sharing data to fight fraud, new tools to prevent fraud, expanded overpayment recovery efforts, enhanced penalties to deter fraud and abuse, stiff new rules and sentences for criminals, greater oversight of private insurance abuses.

According to federal law, a healthcare provider filing a false claim for medical services that not provided, weren’t rendered in full, or that were medically unnecessary, can be subjected to 5 years of prison, a $250,000 fine as an individual and $500,000 for a corporation, or both. In case of making false statements, or covering up material, offenders will pay a $10,000 fine, and serve a 5 years prison sentence, or both. Soliciting monies or services, or receiving them, in exchange for gifts, financial rewards, or services that Medicare covers, is also a crime. Penalties for this could include a fine of $25,000 and/or serve 5 years in prison. If a prosecutor can prove that the violator used certain forms of media (TV, Internet etc.) to advance such deceit to the public, they can end up in jail for 5 years, plus become liable to pay a $1,000 fine. Finally, according to the recent passage of the Kennedy-Kasselbaum Act, if the offender schemes to defraud any healthcare agency, they may draw penalties of up to 10 years of imprisonment, plus any court costs, fines, or financial penalties the court deems fit to assign them. If an injury occurs due to such schemes, the sentence may get up to 20 years plus fines. In case of death the penalty may turn into a life term in prison.

Physicians can take 2 simple steps to avoid accusation of Medicare fraud or abuse in the future: billing audits and keeping detailed and accurate patient records. Conducting regular audits may disclose contradictions that should be investigated and corrected immediately. Detailed and accurate records will assist any investigator in determining whether a medical billing issue was fraud or a mistake, and will help eliminate any mismatch quickly. Ultimately, the easiest way to elude prosecution of healthcare fraud is keep up with the relevant laws, regulate your billing practices, and immediately deal with errors discovered during routine audits.