Keeping your practice fiscally healthy while you keep patients physically healthy can be tricky. Medical practices work hard, offices get busy, people need attention and everyone on staff does their best to provide the immediate goal of helping people feel well. But we also know that the only way you can continue to help your patients feel well is if you maintain a healthy business that sustains your overhead, staff costs and profit.
Your ability to collect maximum reimbursement can make or break your ability to provide excellent healthcare to your patients. Without steady, high levels of reimbursement your practice will likely suffer from low cash flow and minimal profitability. It can also impact your staffing choices, ranging from running with too few employees to underpaying critical staff members, resulting in poor care. The stress level in a practice that is under-reimbursed can damage your practice from the inside out.
One way to keep a practice in the black is to minimize claims denials — that’s not as easy as it sounds. A recent American Medical Association study sought to calculate just how much reworked claims can cost a practice and found that medical offices waste as much as $14,600 each year on correcting denied claims via appeals, trouble-shooting and countless phone inquiries.
But you already know all about this — your billing staff or outsourced billers probably tell you all the time how many obstacles stand in the way of successfully submitting claims.
Here are some tips to help you avoid leaving $14,600 on the table each year:
Guest post by Timothy “Dutch” Dwight, vice president of business development, Medullan, Inc.
Timothy “Dutch” Dwight
Will today’s pioneer ACOs share the same demise as the HMOs of the 80s and 90s? It’s certainly starting to look that way.
Like HMOs, ACOs (Accountable Care Organizations) were created to reign in excessive fee-for-service arrangements and provide an incentive for capitating costs. The premise was that under the umbrella of an ACO, providers and payers would share in the responsibility for quality, cost and coordinated care for a defined population of patients.
If an ACO saved money for the payer without compromising quality, providers — defined as physician practices, hospitals, group practices, physician-hospital alliances and networks -–would share in the savings. And the savings were projected to be significant. Early forecasts from the Congressional Budget Office estimated that the 32 pioneer ACOs could save more than $1.1 billion in the first five years. On the other hand, if the ACO failed to meet capitation limits while providing care, the group shared in the losses.
To offset the risk and encourage membership, the early ACOs were supposed to receive multi-year compensation. However, that financial support disappeared after the first year and most provider groups did not have the business margins to carry them through a long-term investment approach. In addition, the ACO model requires a draw on scant resources from all parties to create another layer of program oversight – further cutting in to margin.
So where does the ACO model stand today? Nineteen of the 32 pioneer ACOs have left the program over the last two years, resulting in considerable wasted taxpayer dollars. As CMS moves towards the Next Generation program, can it succeed?
What will it take to save the ACO?
I believe ACOs can be saved, but significant changes must be enacted.
The fundamental problem with the pioneer ACO is that it manages the care of an unhealthy population without having sufficient oversight of that population. This leads a risk-adverse industry to hold their cash and cling to old processes.
Two years ago, Clayton Christensen rightly pointed out that the provider community must make major process and procedural changes in order for the ACO model to work. “No dent in costs is possible until the structure of healthcare is fundamentally changed.” I couldn’t agree more.
To survive, ACOs need to align with the Patient Centered Medical Home (PCMH) model, which is continuing to thrive and grow. PCMH is designed to align more holistic care management with a consumer incentive to prevent high-spend patients from seeking services from the more costly care centers such as emergency rooms. The payer, or insurance company, rewards the consumer for making smart choices by reducing deductibles and other fees if they use lower cost service centers such as primary care physicians, nurse practitioners, and urgent care centers. PCMH models use a combination of fee-for-service, value based payments to providers and align consumer incentives to reduce the cost of care. Comparatively, the ACOs capitated, “value based” payment model, intends only to lower the cost of care without having the proper procedures, tools and feedback loops in place to account how that care is provided. In other words, a visit to a PCP or ER makes no difference in the ACO model. On their own, ACOs do not have enough process control(s) and sufficient incentives to change patient behavior.
However, in combining the ACOs and PCMH model, the healthcare industry stands a much greater likelihood of meeting its goals — to improve the quality of care while containing or lowering the costs.
What needs to happen?
It starts with patient education – consumers need to be educated about their options and when and how to best use them. The next step is employing financial incentives. In short, money talks and will be key in changing old habits. When there is financial reward for going to one’s PCP or an urgent care center instead of an ER, consumers will make smarter choices. And ACOs will have an easier time capitating costs.
Guest post by Daniel Schwartz, content strategist, CureMD.
Daniel Schwartz
On Oct. 1, 2015, the 10th revision of the International Classification of Diseases, or ICD-10, will go into full swing, requiring that all healthcare institutions and organizations covered by the Health Insurance Portability Accountability Act comply as such. This will mark a transition from the previous classification of diseases, called ICD-9. The Centers for Medicare and Medicaid Services (CMS) has already released several documents and other mediums of information to help answer questions and concerns about this upcoming change and to provide avenues of approach to handling the upgrade, and you might find that, if you’ve waited until now to begin preparation or even so much as to begin thinking about this major coding change, you’ve waited far too long.
In a recent survey done by the Workgroup for Electronic Data Interchange (WEDI), 25 per cent of physicians stated that they are not going to be ready when the ICD-10 compliance date arrives, and another twenty five per cent stated uncertainty. Marcia Frel lick, author of the article on Medscape that represents this statistic, writes that Robert Tennant, vice chair of the WEDI group, says that “the physician side of the provider community [is] really struggling,” and, judging by the numbers in their survey, he seems to be largely correct.
Exactly a year ago, Aug. 10, 2015, the first phase of the recommended transition process, suggested and published by aafp.org in early 2014, would be less than two months away. This debut entry into the process would begin October 1 and end in December, and would include necessary tasks such as scheduling hard-date meetings with committees and personnel, conducting large inventories of coding, becoming vastly familiar with the ICD-10 coding itself, budgeting for the transition, learning your implementation plan, and much more. After the completion of the first phase, the second phase would then begin in January of 2015 and last until April, demanding the passing of tasks like completing ICD-10 training on all levels, reviewing insurance contracts, evaluating your current cash flow, and determining the impact quality initiatives, such as PQRS and Electronic Health Records, had in 2014 for your institution. These are only two of the five total phases aafp.org suggests you complete, and if you’re just now starting to look over what needs to be done, you’ll be cramming all of this scheduling, monitoring, determining, and preparing while you’re already integrating ICD-10—specific workflow plans, processes, and claim submission resources; in other words, you’ll be doing far too much within a miniscule time period, leaving too much room for error, failure, and dissatisfaction.
ICD-10 will provide more than 14,400 distinctive code sets and the ability to track many new diagnoses for hospitals and other practices. Such a large database of higher-echelon information does not demand proper transition, but requires it. Since the current ICD-9 codes are being used in almost all current healthcare processes, rather significant and grandiose substitutions and reincarnations are going to have to take place. This large-scale implementation is required so as to ensure that the codes will be put into place and used correctly, because of the improvements they carry for features such as service reimbursement, coverage qualifications, population health management and reporting, and more.
If you’re already feeling concerned about waiting too long, there are other concerns you should be worried about that would have been your only concerns if the proper preparation-phasing would’ve taken place much earlier in the year. A lot are worried that the translations from the previous ICD-9 to the current ICD-10 will not be straightforward or easy to follow, and some of these translations are indeed not directly correspondent. They include disproportionate changes that go both ways, from ICD-9 to ICD-10 and vice versa. In spite of this, there have been tables and crosswalks published to make this transitional process more painless, but it’s going to take more study and observation in order to properly determine how the coding will completely change. Practices and institutions of healthcare that have not been preparing sufficiently for these new and complex implementations and upgrades ICD-10 will bring will be maniacally wishing they had when the date of compliance arrives.
Guest post by Tom S. Lee, Ph.D, CEO and founder, SA Ignite
Tom Lee
The Value-Based Payment Modifier (VBM) is one of the most impactful yet least understood components of the portfolio of value-based programs under Medicare Part B. Provider organizations widely know that their Physician Quality Reporting System (PQRS) quality measures must be reported to CMS in order to avoid significant VBM penalties. Yet, few organizations understand the value-based payment modifier rules well enough to know how to improve their value-based payment modifier quality and cost scores, which directly impact Part B reimbursement. And, the stakes are high as the 2015 VBM can have a +/-4 percent or greater impact on Part B, and starting in 2017, value-based payment modifier comprises 60 percent of the reimbursement impact of the newly-passed Merit-Based Incentive Payment System (MIPS). MIPS rolls up value-based payment modifier, meaningful use and other value-based programs into a single score for each provider that can impact Part B reimbursement up to approximately 30 percent based upon cost and quality performance relative to peers.
One way to understand the growing importance of VBM is to compare the rules and metrics of the 2013 program to those of CMS’ proposed 2016 program. The rise is stunning and reminiscent of the rapid expansion of other game-changing programs, such as meaningful use, but where the financial and reputational impacts are even greater.
The growing number of providers subject to VBM penalties
VBM penalizes providers falling into the lowest tier of quality performance among peers nationally, as determined by PQRS and other quality measures. In 2013, approximately 30,000 providers were subject to value-based payment modifier quality-performance penalties. In 2016, CMS projections and proposals taken together indicate that 1.25 million providers will be subject to such value-based payment modifier penalties, representing a 40-fold increase in the span of 4 years.
Why the growth? It’s all about regulatory change. In 2013, this quality-performance penalty only applied to groups with more than 100 providers, which opted into quality tiering, and it excluded organizations in the Medicare Shared Savings Program (MSSP), Pioneer ACO Model, or the Comprehensive Primary Care Initiative (CPCI). Furthermore, penalties were only applicable to Part B payments to physicians (MD, DO), not payments to non-physician providers (nurse practitioners, physician assistants, etc.) In 2015, CMS cast the net wider by expanding quality-performance penalties to apply to all groups down to only 10 providers in size and including participants in MSSP ACOs, Pioneer ACO Model and CPCI. For 2016, CMS is proposing that the size threshold be removed entirely such that all groups and solo physicians be subject to quality-performance penalties and that the penalties should be applied to Part B payments to non-physicians as well, not just physicians.
The amplification of VBM incentive and penalty dollars
The sizes of the maximum incentives and penalties in 2013 were 9.8 percent and -1.0 percent, respectively. The national incentive pool is set to be equal to the national penalties assessed in order to keep value-based payment modifier as an overall budget-neutral program. Hence, the “winners take from the losers,” where “losers” also include those providers who simply did not meet the minimum PQRS reporting requirement imposed by value-based payment modifier. This non-reporting percentage was about 30 percent of eligible providers in 2013, and CMS projects about the same percentage for the 2016 performance year. Hence, assuming that the proportion between winners and losers remains about the same in 2016 as compared to 2013 (about 13 percent), and factoring in the proposed 2016 value-based payment modifier rules, the maximum value-based payment modifier performance-based incentive could rise to as high as 20 percent, while the maximum penalty would be -4 percent, respectively representing 2 times and 4 times increases from 2013. As mentioned above, MIPS further increases the potential financial impact to 30 percent or even more of Part B payments.
The HIMSS Innovation Center stands as a marquee venue for organizations wishing to build their brands and market their health IT-related services both locally and globally. As a result, less than two years after its opening, 20 organizational collaborators have established a presence at the 30,000-foot facility located on Cleveland’s lakefront.
Attracted also by the HIMSS Innovation Center presence on the 4th floor of the Global Center for Health Innovation, collaborators have dedicated exhibition space, and many other benefits relating to the use of the facility and participation in HIMSS events. Collaborators can join at one of four levels – Founding, Strategic, Industry and Supporting.
“Many organizations are inquiring about reserving space at the HIMSS Innovation Center,” said John Paganini, HIMSS senior manager of interoperability initiatives, noting that HIMSS Pinnacle Corporate members automatically become supporting collaborators of the HIMSS Innovation Center. “There are increasing opportunities to create awareness as events are added and the Global Center for Health Innovation continues to become the premier destination for healthcare professionals.”
Founding collaborator Alego Health leads to way toward innovation
Headquartered in Westlake, Ohio, just outside of Cleveland, Alego Health advocated for the establishment of the HIMSS Innovation Center as a natural fit with the Global Center for Health Innovation next door. Alego Health uses the HIMSS Innovation Center to showcase its products and services during events and through presentations to customers. The company also interviews candidates for employment during recruitment events at the center and conducts training programs for employees and partners there.
Alego Health’s interactive exhibit at the HIMSS Innovation Center includes six iPads and two InTouch screens, through which individuals can learn more about Alego Health and its product and service offerings. “They can contact us directly, if we’re not there as part of a scheduled event, and we can create a Skype connection to the exhibit and have a discussion,” said Jonathan Levoy, Alego Health executive vice president.
As one of the nation’s premier full-service health IT providers, Alego Health sees its presence at the HIMSS Innovation Center as key to its brand and market positioning – to work with healthcare organizations of all sizes to advance the continuum of patient care through the adoption of technology, Levoy said.
Guest post by Tim Cannon, vice president of product management and marketing, HealthITJobs.com.
Tim Cannon
A study, early this year, found that more IT employers are offering their employees flexible work options. But in the wake of security and data breach, is it worth the risk in health IT?
A report published by the Ponemon Institute in September 2014 revealed 43 percent of U.S. companies surveyed experienced a security breach in the past year, up from 33 percent in 2013. Healthcare organizations are a prime target for cyberattacks, according to a report from the Identity Theft Resource Center. Health and medical companies suffered the most breaches in 2014, accounting for 42.5 percent of reported cyberattacks.
Here are some of the biggest risks health organizations face with a virtual health IT workforce, and how to keep patient data safe:
Email risks
Hillary Clinton recently came under fire for using a personal email address for government business during her time as secretary of state. Not only did her exclusive use of personal emails violate federal record-keeping laws and practices, but also put sensitive information at risk. Her actions remind us that employees are using their personal email accounts for work, whether their employers are aware or not.
Health IT professionals who work from different locations and from different devices could be sharing unencrypted data over their personal emails without password protection. They could be sending work emails from a personal account on their phones or home computers because it’s more convenient than connecting to their work accounts.
Solution:
Set clear policies on email use and remind employees of the importance of password protection when sending sensitive information.
Network vulnerabilities
To accommodate the remote workforce, networks and cloud-based data storage systems can be accessed from any location. But more employees using the network and accessing data from different places makes it easier for hackers to access the information as well.
Remote workers usually operate out of their home offices. This means they are using their home network, which is usually much less secure than the office network. Sometimes, they also work out of Starbucks and other public spaces that have unsecure Wi-Fi networks. These places also do not have standard security protocols, which means all the data is unencrypted and easy for hackers to steal.
Solution:
The underlying software of the network needs to be secure, no matter where employees are working from. Securing cloud-based systems is also extremely important. Making sure your servers are up to date with service packs and software updates is critical to close potential holes in your network. Having a strong virtual private network is critical to protect patient information and other sensitive data. Invest in highly protected providers, encrypt sensitive data, and diversify your passwords to avoid security breaches.
Guest post by Crystal Ewing, senior business analyst and manager of regulatory strategy, ZirMed.
Crystal Ewing
Denial management is an industry-wide challenge—and despite traditional approaches intended to reduce denial rates, it’s one that continues to grow. Frankly, this is absurd.
I say that because, despite the recent announcements from CMS regarding changes to how they will process ICD-10-coded claims for the first year, denials will likely still increase under ICD-10—and that’s something healthcare providers don’t need to suffer in full, because it is possible to reduce their denial rates before ICD-10. Ultimately this will be more impactful than any denial management program specifically targeting ICD-10-related denials, because the “everyday” denials will otherwise endure and continue to delay A/R long after whatever disruption ICD-10 causes has long faded into distant memory.
Here are two simple truths:
90 percent of denials are preventable
More than 60 percent of denials are recoverable
So where does this leave healthcare organizations seeking to decrease denials ahead of ICD-10, a change that—despite recent announcements from CMS—is nonetheless likely to bring with it a spike in denials?
Exactly where they’ve always been—in need of straightforward best practices that actually help them drive down everyday denials that create A/R delays, back-office backlogs, and an unreliable revenue cycle.
Step 1: Thoughtful Automation
Let’s step through a common process for working denials, just to clarify why it’s such a headache.
Here are some time-study figures—per each denial, staff spend:
4 minutes identifying the denial and routing it appropriately
+ 10 minutes gathering information
+ 30 minutes compiling and filling out appeal letter and materials
+ 5 minutes just documenting all their activity related to the denial
and visit/log in to the associated payer’s website for 25 percent of denials
That is unacceptable—which is an opinion. But it’s also unnecessary, and that’s a fact. Each of the time-consuming manual processes mentioned above can be eliminated or significantly reduced through thoughtful automation and workflow-focused software development.
Reducing research time and enabling staff to easily resubmit denied claims are two of the biggest denial management time-savers—period.
Guest post by Steve Tolle, chief strategy officer and president of iConnect Network Services, Merge Healthcare.
Steve Tolle
Sooner than later, payers will demand meaningful interoperability to determine the true cost of quality healthcare outcomes. While they may not have a preference for which electronic health record (EHR) platform a doctor or health system uses, they will understand that a platform’s ability to communicate with other EHR platforms will affect the cost and quality of the care provided.
Payers are already implementing bundled payments for some types of costly care, such as full hip replacements. Conventional assumptions aside, physician fees and facility charges are not the leading drivers of joint replacement cost variability. Instead, wide cost disparities frequently seen between Joint Replacement Procedure A and Joint Replacement Procedure B are the product of unpredictable charges for supplies, anesthesia, and medical imaging. When payers start bundling reimbursements for common procedures, risk will shift to providers who will be challenged to closely manage cost fluctuations. In preparation for this transition, healthcare organizations must proactively assess their imaging strategies to keep their business running smoothly, continue providing quality patient care, and ensure they maximize revenue for the services they deliver.
What Providers Must Evaluate
Medical imaging is a $100 billion industry that drives $300 billion in healthcare spending. It accounts for nearly eight percent of U.S. healthcare spending, according to the Journal of the American College of Radiology — a costly component of care that must be effectively addressed as the industry readies itself for the shift from volume to value-based reimbursement.
The U.S. Department of Health and Human Services recently set an ambitious goal that by 2016, 85 percent of healthcare payments will be tied to quality and value of care. Successful healthcare organizations will need to manage two key factors closely — appropriateness and efficiency.
CMS and private payers will increase their vigilance around quality measures such as readmission rates and unnecessary diagnostic imaging. Medically unnecessary or redundant imaging is already on Medicare’s radar, showing up in legislation that mandated decision support for imaging and extended the deadline for ICD-10 conversion. If providers begin to correct course now, downstream risk of lost revenue and decreased patient satisfaction can be mitigated, if not avoided.
Take Stock of Current Assets
To stay ahead of the curve, providers should evaluate all aspects of their image management programs. Many are looking for new solutions that simplify and digitize outdated, paper-based procedures for patient orders, automate insurance payment authorization, and move images from point A to point B in real time, regardless of file format.
