award icon Created with Sketch. calendar certificate clock icon Created with Sketch. E3102F58-39B7-46A0-8807-E0F8514AF64F Created with sketchtool. B48371CD-7E6B-424D-A27D-C47F740A4CE9 Created with sketchtool. graduation-cap-v2 BE74797F-D7BA-4121-9C80-10A96FDA86F0 Created with sketchtool. 0260AD13-A00B-4C10-833D-FC53567907CE Created with sketchtool. moneystack Created with Sketch. nib icon 12-5 Created with Sketch. resume icon Created with Sketch. E2B92C1B-84F1-409E-84D3-5740C0E9A496 Created with sketchtool.
Loading...Please Wait
Collecting Effectively From Third-Party Payers and Patients

Welcome! This article is part of a Medscape Physician Business Academy course, . Visit the Course Page to take the full course and receive a certificate.

Why Claims Are Being Denied

The AMA 2013 National Health Insurer Report Card (which was discontinued in 2014) shows that a major reason for rejected claims by insurance companies are because the procedure is a noncovered charge or the medical practice has not provided required information. These denials are typically due to the practice not having the correct information at the time the service is billed. Still, there are many other reasons for denied claims (such as insurers not having the appropriate information in their drop-down menu), and physician office billing staff must be diligent on following up unpaid and denied claims so that the physician receives payment for all complete claims submitted.

In most medical practices, this information is obtained when the patient presents at the time of the appointment, and often it is a paper process that is repeated at every visit. Usually the patient completes this process alone, and the completed forms are then given to the practice receptionist, who may not review them for accuracy, legibility, and completeness.

In addition, the forms are usually reviewed only for clinical information while patients are in the office. Missing billing data are found when the billing staff begins to bill the visit, which can be up to one week later or more. In practices without an EHR, the paper forms are inserted into the patient's chart and filed in the office chart. When an EHR is present, the information provided by the patient is often entered into the computer record by the doctor's staff. This may increase the possibility that the data are incomplete or incorrect.

Physician office billing staff must be diligent on following up unpaid and denied claims.

More and more EHRs have a Web application that allows patients to input their relevant information directly into the EHR, either from the physician's office or via the practice's website. Through federal government program requirement, physicians can earn bonuses if they have Web-enabled systems for registration and health record access.

Another problem is that while patients are completing the record via the Web or practice portal, they may realize that they are missing some piece of information required by the system. As a result, the patient may quit the process and decide to register when they get to the doctor's office.

A more efficient way to gather necessary patient data is to enter it when the patient telephones to make an appointment. If the patient is making this call from their home, they should have available all the necessary information to complete the record. During this process, the call center staff will be there to answer questions and to verify information as it is entered into the system. If the practice uses a web portal, they can usually get the patient's information in advance of the visit, and have time to review it and request any missing information. We will cover web portals more fully in a future chapter on EMRs and technology.

Your staff should obtain the following information, at a minimum:

  • Insurance carrier;

  • Plan number;

  • Insured's name—be sure to get the exact name shown on the insurance card;

  • Insured's identification number;

  • Effective date of coverage;

  • Patient's name;

  • Patient's relationship to the insured;

  • Patient's date of birth;

  • Other insurance coverage that may be applicable as secondary to primary insurance (eg, a spouse's plan);

  • Reason for visit;

  • If the visit is due to an auto accident, auto insurance information; and

  • If the visit is due to a worker's compensation claim, worker's compensation insurance information.

Another key question to ask is whether there is secondary insurance coverage. This is not as common in the current economy, but at times a patient can be covered by their primary insurance and also by their spouse's insurance as a secondary insurance. Medicare patients frequently have secondary insurance to cover the portion of the fees that Medicare does not pay. Because every insurance carrier seems to have different requirements that need to be followed in order for the claim to be paid, the practice needs to know all the potential insurance payers so that the proper procedures and notifications can be performed to ensure the maximum payment.

When the patient is making the appointment, the call center staff should consider the reason for the medical visit. If the patient has been in an accident, his or her primary medical insurance may not be the first insurance that must be billed. It could be that the car insurance company should get the first bill for services and the patient's primary health insurance would be billed after the auto insurance pays their portion. Following up on this information when the patient is in the office—or worse, after the service has been rendered and the patient has gone home—usually results in significantly delayed or even denied payments. Getting it right at the beginning not only speeds up payment but also saves staff time and expense.

Just like getting the correct company to bill, getting the correct data from the insured or the patient is also critical. If the information is slightly incorrect, payment will be denied. Things to consider are the relationship between the insured and the patient, the proper spelling of the patient's and the insured's name, and the correct subscriber number. The more of this information you can get when the appointment is being made, the less you will have to follow up on inconsistencies that result in denied payments.

If you get this complete information, make sure that it is immediately entered into an EHR of some type so that you don't have to ask for it again when the patient arrives at the office; you'll only need to verify what you have already entered. If you're using an advanced EMR or practice management system, this should not be a problem. If you have not converted to an EMR system, set up some type of database in your office to keep track of this information.

What's the most efficient method of collecting the necessary data when a patient calls in for the initial appointment or schedules a procedure or test? All but the smallest practice should have a dedicated call center or appointment staff that is trained in billing and collections. It is at this point that an effective staff can gather the data necessary to make sure that the fee for services rendered is ultimately collected. It is also at this point that the staff can arrange for payment if the insurance will not cover the entire bill.

This requires selecting employees who have knowledge of the billing system and understand the required data. It also calls for an employee who can inform patients of their payment responsibility and counsel them on methods of payment. This staff member would not be a typical "receptionist," but rather a more experienced individual who could be trained to handle difficult conversations with patients about bills, yet still be positive and friendly. The call center position should be considered a higher-level position and have a good base salary with financial incentives for meeting expected preestablished targets. The call center staff should be an integral part of the collection process and could become at least as important as the billing staff.

As more and more of the business of medicine becomes automated, a practice can use a Web-based software application designed to capture eligibility and benefits coverage as well as calculate the patient's portion of out-of-pocket expenses as a resource to the appointment staff. Even at the time of the initial call, a practice could gather the necessary data, verify it with the payer immediately, and identify the amount of payment needed from the patient.

At this point, rather than weeks after the service has been rendered, the practice can discuss with the patient what their portion of the bill will be and ask them for their expected method of payment. For more expensive services, the staff can ask the patient for a deposit. At a minimum, the patient should be asked for credit card information to keep on file to charge his or her portion of the bill once the claim has been adjudicated.

In addition to credit card information, patients should give the practice their contact information, including home address and phone number; cell phone number; email address; emergency contact details; and employer name, address, and phone number. In other words, all information on the registration forms that is nonmedical should be obtained during the initial call for an appointment.

The amount of time a patient spends waiting for the physician affects their perception of the quality of care.

If the patient is a recurring patient, this information should be verified. Although this will slow down the appointment desk process, it will significantly speed up the check-in process. The appointment desk should be established somewhere away from the registration desk and patient rooms, if possible. It can even be housed off-site. This would allow the receptionist to check the patient in, obtain a copy of his or her insurance card, and collect copayments and any other outstanding balances, as well as perform other front desk duties. It will ultimately get the patients out of the waiting room and into the examination room more efficiently.

Because one of the most frequent patient complaints about their doctor is the time spent in the waiting room, decreasing the time spent waiting is not an insignificant benefit. According to K. Hill in Patient Satisfaction: An Analytical Approach to Waiting Times, written for the Sophie Davis School of Biomedical Education Primary Care Leadership Program, going from a 0- to 10-minute wait to a 11- to 20-minute wait resulted in a 14.1% drop in the percentage of patients who determined that they received adequate care. In other words, the amount of time a patient spends waiting for the physician affects their perception of the quality of care. This was the same result reached in a study done by C. Bleustein of PricewaterhouseCoopers of New York for the American Journal of Managed Care in May 2014.

During the interval between the patient making the appointment and arriving in the office, the practice should take the time to verify the insurance coverage. This is often done automatically by the newer billing and practice management software. If this is not possible, eligibility can be verified through the online portal for the patient's insurance plan and can also be done via phone, although both of these methods can take up valuable staff time.

In general, the insurance should be verified within 2-3 working days of the scheduled appointment. If the insurance is verified too early, the coverage may lapse before the patient comes to the office. If the coverage is verified too late, the office does not have the time to follow up with patients whose insurance could not be verified, so that alternative coverage information can be gathered and verified, or other payment plans can be arranged.

Not only should the basic information be verified, but when possible, the benefits provided should be verified as well. The number one reason for denial of payment listed by most insurance payers in the AMA report was that the services were not covered—meaning that either the patient or the type of scheduled service or procedure was not covered by the plan.

These nonpayment problems can be eliminated if the physician's staff verifies the patient's level of benefits before the service is rendered and makes sure that the scheduled procedure or service will be covered. For example, the patient may be properly covered by Aetna, but his or her coverage does not include the annual physical examination that has been scheduled. If problems arise when the coverage is verified, then the practice can contact the patient and discuss other options for payment of charges that will be incurred.

This process would finally put medical practices on the same footing as most other businesses that expect payment at the time of service.

So far, we've discussed how to get the necessary data to make sure the insurance company will pay the claim. This is also the time to get the necessary information to make sure that the patient will pay the portion of the bill that is his or her responsibility.

Many physicians and their staff are hesitant to have this conversation with patients. However, how often do you leave a restaurant or make a hotel reservation without giving a credit card to pay the bill, or as verification that the remaining bill will be paid? If a practice is serious about improving its collection rate, it has to begin at the start of the revenue cycle.

As we become a more technologically advanced culture and more and more information can be transmitted to the practice via its web portal, the call center staff can spend more time reviewing the data that were entered, following up on exceptions, and explaining billing and payment options. Practices should make sure that their payment and deposit policies are posted on their website, so that patients aren't surprised by them. The patient can be referred to the practice website when questions arise during the appointment process or the resulting check-in process when payment is requested. In addition, the complete payment policy can be included in the package that is sent to new patients before their first visit. It can also be posted in the office waiting room and put on any brochures prepared for the practice.

Finally, this is the time to connect with the patient. Usually, when the patient enters the office for the first time, the waiting room is full and the receptionist is busy. If the call center is staffed properly, the physician's staff can take the time to connect with the patient and answer any questions they may have about their upcoming visit. In cases where the call center is scheduling a surgery or procedure, not only can the billing data be obtained by the practice, but information can be given to the patient about their presurgical preparation, procedure, and postsurgical expectations. Any questions that patients have can be handled privately, with enough time for issues to arise that they may be hesitant to broach in a full office waiting room. When call centers are working optimally, they will relieve the stress on physician's waiting rooms, front desk staff, billing department, and ultimately the physician and patient.

Review Questions
Next Chapter
Complete a self-assessment to earn a Medscape Academy Certificate or continue to Medscape Education to earn both a Medscape certificate and CME credit.
Earn Medscape Academy Certificate
Earn Medscape Academy Certificate
+ Credit
on Medscape Education
Earn Medscape Academy Certificate
View Course Certificate
View Course Certificate
Activity - Credits

Welcome! This article is part of a Medscape Physician Business Academy course, . Visit the Course Page to take the full course and receive a certificate.

| January 01, 2016