Well-designed audit helps beyond late payments
Well-designed audit helps beyond late payments
Benefit matrix can make task easier
Creating an internal audit system can help you check your payment records for both timeliness and accuracy. (See related story on late-paying MCOs on p. 73.) Kristen Jabs, director of managed care accounting for Seattle's Medalia Health Care, says such audits have helped both the 350-physician practice and the insurers it contracts with identify problem areas in the system.
One effective tool for organizing an audit is to create a matrix of the benefits, fees, and conditions contained in each contract, says reimbursement expert Gloria Mayer, president of Mayer & Mayer Consulting. This allows a practice to keep track of the various contract terms and conditions for each payer with which it contracts.
"This matrix will provide a quick reference for all payer contracts, allowing the practice billing manager and auditor to actually see the range of services and corresponding fees each plan is supposed to pay," says Mayer. "Plus, it can be a very valuable tool when you are negotiating to add various performance provisions to the contract."
Information that needs to be in the matrix includes:
· original date the contract was signed;
· length of the agreement and the renewal dates;
· payment methodology;
· any supplemental benefits and how they are to be paid and administered;
· shared risk or diagnostic pools for which claims must be submitted;
· specifics of any incentive programs.
Once you have identified the categories to include on your benefit matrix, you need to do a thorough audit to construct another matrix of past payment practices in order to uncover any serious problems that need to be corrected.
"Whenever problems are identified, new contract language should be developed to rectify the problem along with any financial penalties or incentives to discourage future late payments," says Mayer. These could include such target areas as:
· timeliness of payments;
· timeliness and accuracy of reports;
· adherence to claims authorization and processing guidelines;
· enrollment and eligibility accuracy;
· claims processing accuracy, turnaround and reporting;
· accuracy of membership growth projections;
· reliability of electronically transferred information;
· record of how specific problems were resolved.
Details contained in the matrix, or ones unearthed during an audit, can serve as a basis for ongoing meetings between a practice and the major MCOs it contracts with. "Once a contract has been negotiated or renegotiated, the work really begins," says Mayer. She recommends a joint operating committee that meets monthly, or at least quarterly, with the appropriate staffers from both sides to discuss contract performance.
Another option is to arrange a short walking tour of the plan's payment, eligibility, and claims operations. This can help alert you to potential payment problems.
"Use this time to evaluate the precise capabilities of the managed care organization, " advises Mayer. Look for such things as evidence of an organized claims flow, policies and procedures, automated claims processing systems, and knowledgeable staff.
"One of the simplest things to look for is whether an excessive number of claims are laying around on desks, the floor, or in boxes," says Mayer. "This is a real sign that a plan lacks the systems and expertise to efficiently process claims and encounter data."
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