Is your verification process up to par?
Are you certain the patient's insurance is actually active? The earlier in the process you learn this information, the more likely you are to avoid bad debt.
"Especially in the ED, but really anywhere, patients are often not in tune with their insurance and how it all works. A lot of patients come into the hospital thinking they have insurance eligibility that might have terminated for some reason," says Joseph Ianelli, senior financial manager of Boston-based Massachusetts General Hospital's admitting department.
The department has taken a strong stance that authorizations for elective admissions "need to be all sewn up and done" before the patient comes in, says Ianelli.
"You don't want to obtain authorization too far in advance, because people do go on and off insurances. But you do need to start the authorization process at least five to seven days in advance, depending on the insurance company," says Ianelli.
The cutoff point is two days before the patient's admission. If there isn't an authorization at that time, staff contact the provider's office to communicate that there may be a problem with the insurance company. "It could be that the insurance company is saying the patient doesn't meet the medical criteria. If so, then we need to get the doctor engaged," says Ianelli. "It's really unacceptable to tell the patient the day before that you can't do the service."
Another obstacle might be that a clinical test is being requested by the payer. If you wait until the day before to find out why the test hasn't been done, that claim will end up being denied. Cases like this are fairly rare, comparative to total volume. However, when they do occur, a physician may need to get on the phone to explain that the test was done previously, or can't be done for a medical reason.
"So you are running into very tight time frames for insurance verifications. But it's an important way to eliminate bad debt," says Ianelli. "You don't want to hear two days after you do the surgery that you're not going to get paid. Then it becomes somebody else's problem in credit and collections. The revenue may be denied or delayed for months and months because of an appeal process."