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When the high rate of reimbursement denials at Shands Hospital at the University of Florida in Gainesville was attributed to errors by the admissions department, associate director Beverly Varshovi decided a closer investigation was in order.
"My style is, I can fix anything, but you need to show me," says Varshovi. "I want evidence, not anecdotes. I said, Let me see the accounts.’"
The results of that effort led to the discovery that a huge number of the "lack of pre-cert" designations by the insurance companies were incorrect, and to the recovery of more than $1 million rightfully owed to the hospital, she explains.
In the past fiscal year, from July 2000 to June 2001, the patient financial services (PFS) department wrote off $2.3 million in pre-cert denials, Varshovi says, and the admissions department was able to reduce the figure to $935,000. In the six months before that, she adds, from January 2000 through June 2000, her department reversed $830,000 in denials.
At first, the PFS at the Gainesville-based hospital provided admissions with a list of accounts that were being written off, Varshovi notes. As the two departments began to work together as partners, she says, PFS staff gave admissions a heads-up on accounts they were about to write off because the payer had stated there was a "lack of pre-cert."
Rotating the task among different assistant managers, admissions personnel began looking up each account on the list to see who had created it, and in what setting, Varshovi says. "Seeing the employee’s initials on the account, we would go back to that individual and say, The payer is saying there was no pre-cert. What can you tell me?’"
Because her staff routinely scans pre-certs and keeps them on file, the investigation revealed that in a "tremendous" number of cases, the pre-cert was on file, authorization had been obtained, and the payer was "somehow mistaken," she adds.
What Shands calls an "insurance verification pre-certification documentation form," she says, includes eligibility and benefits data, who was spoken to at the insurance company to obtain that information, and who was spoken to — usually in a separate call — to get the pre-cert.
"We research each and every one," Varshovi notes. "With about 20% [of those sent back for "lack of pre-cert"], there actually is an error."
In a large number of cases, there are "clinician issues," she adds, whereby the access employee gets authorization for one service, and the clinician expands or adds on a procedure without notifying admissions.
For example, Varshovi says, "a mammogram leads to an ultrasound and no one gets back to us." Sometimes, an insurance company takes the opportunity to deny payment for both services, even the one for which a pre-cert had been obtained.
In some instances, a change in a patient’s status leads to a wrongful denial. "Payers have a different way of storing data," she explains. "If we called on a short-stay observation patient, they would give us one pre-cert number, but then when the patient met the criteria for an inpatient stay, we would get another number. We can only store one number, so we would send the latest one [on the claim], but they stored the file under the original [number].
In other cases, she says, the insurance company actually reverses itself, after giving the hospital the OK for a procedure. "We’re not for profit,’ but they’re businesses," Varshovi points out, "in the business of making money for stockholders. If the account gets written off, what does the payer care? The client got quality services, and we got nothing."
An ace-in-the-hole for Shands is often the fact that admissions staff digitally record all the calls during which inpatient pre-certs are obtained, she notes. "We only let them know that we can replay the conversation. We’ve never had to actually play it for them."
The latest initiative in this reimbursement arena, Varshovi says, is the building of an intranet insurance verification form. This will allow the admissions department’s partners — physicians and PFS — to easily access patient account information. That should be ready next year, she adds.
Because the positive return on investment is clear, Shands likely will eventually dedicate a full-time equivalent to the investigation of pre-cert denials, Varshovi says. "It’s pretty unfair to the assistant managers [to perform the task] because the time commitment is significant," she notes. "We rerun the patient accounts, sort by payer, and share the results with the managed care department for contractual purposes."
Meanwhile, Varshovi continues to raise the bar for pre-cert denial turnarounds. "We still want to reduce pre-cert write-offs by 20%," she says. "My goal is that PFS should have to do nothing. We’re not there yet."