Quick steps you can take to stop managed care payers from stiffing you

Delays mean big bucks for insurers and less for you

Pressed by financial problems, many HMOs and other insurers are simply using any excuse possible not to pay legitimate claims, say reimbursement experts. The extent of the problem is hard to determine, but in Florida, where slow-paying payers seem to be epidemic, hospital providers that should be paid within 35 days report nearly 25% of their outstanding bills are at least six months old.

Even holding off on paying a small percentage of claims can generate big bucks for payers. Indeed, PriceWaterhouseCoopers estimates that insurance and managed care companies could earn up to $280 million in annual interest income simply by initially denying 1% of claims, then reversing the denials after a review process.

Here are some strategies providers are employing to help reduce claim denials, speed up claim turnover, and improve cash flow:

File frequently. Most experts recommend that you have the bill prepared and out the door within three to four days after service has been rendered. If you wait any longer, you are just giving the payer what amounts to an interest-free loan.

Some offices prefer to file even more frequently. Frederick (MD) Internal Medicine files claims on a daily basis. Besides speeding cash flow, daily filing reduces paperwork by processing claims on a same-day schedule rather than waiting to do a week’s worth of claims at once.

Know what you are due. "It’s been my experience that a great many carriers are failing to reimburse practices based on their negotiated fee schedule," says Brian Kane, CPA, president of HealthCare Advisors in Annandale, VA.

To help track what you are being paid vs. what you should receive, Kane suggests creating a simple grid with the insurance companies across the top and the main 10 to 15 CPT codes on the left side. Next, fill in what insurers are contractually required to pay for these procedures, then check these amounts against the explanation of benefits (EOB) received from payers.

The EOB differences may seem small, maybe as little as $5 or $10 per patient. But this small change can add up to big bucks over the course of a year. Plus, the more aggressive you are in auditing and demanding full payment, the less likely it is payers will continue pulling the same tricks.

Track denied claims by payer and code. The more information you have at your fingertips, the easier and faster it is for you to spot and correct a particular carrier’s underpayment pattern.

Collect copayments and deductibles quickly. Rather than bill, most reimbursement experts suggest you collect any copayment due before the patient leaves the office. When this is not possible, some practices have found that giving the patient a stamped, pre-addressed envelope to use when mailing in the payment improves collection rates.

The same attitude should apply when the patient is responsible for a deductible in his or her coverage. One way to easily track this is to create a chart listing your top CPT codes and your most-used insurers. The chart should give each insurer’s deductible and co-pay policy for each code.