It seemed like just another one of those "\ve"rc behind on collections" situations. The doctor reached out to us because she couldn't understand win it seemed that she was working so hard, jet collections were just not there. A cursory review of the accounts receivable aging revealed that, indeed, more than $2 million was there, at least on paper. Our usual analysis process ensued because it's often easy to unravel what's really happening. We set out on the task wearing our detective hats to crack the case of the out-of-control accounts receivable. Little did we know, we were about to uncover the nightmare of all nightmares, and this doctor would have done just about anything simply to wake up. The Analysis Whenever there is a situation like this one to untangle, we always start by asking a lot of questions to separate fact from fiction. Because the manager assigned to the billing and collections department was not as proficient or well trained as one would have hoped, there was no telling what liad gone on during the prior 18 months. Here's how we started to peel the onion: 1. First, we had to find out what was really going on to uncover the real reason for this outrageous assortment of patient and insurance balances. Asking questions such as these helped us get there: a. How often do you mail statements to patients? When is the last time? b. Do you print and reconcile aging reports? What is most recent? c. How much time is spent weekly on follow-up for insurance? For patients? d. Do you use a payment plan system? Have you installed auto debit? e. How often is electronic billing done? Paper billing? 2. Next, we had to find out the knowledge level of the staff and providers to identify what systems were being used, if any. Personal interviews were the best way to conduct such an investigation, so we asked key team members questions such as these: a. How do you know if a patient has a balance when he or she comes to the front desk? What do you do if there is a balance? b. What do you say when a patient tells you he or she can't pay today? c. I'm a NP at the end of visit one: tell me how vou check that patient out. Get ready, set. go! d. How mam actual hours were spent in the past seven days calling insurance companies about unpaid bills? c. How do you explain a patient's benefits and financial responsibility after the report of findings? f. Show me how your billing department desk and space arc laid out. g. Send me tlie last tlircc denials that you appealed to an insurance carrier. 3. By this time, we had a good idea of who knew what, and where some of the challenges were in the practice. Untrained team members exacerbated a preexisting problem. The next step was to evaluate thoroughly what money was actually out there to collect. We asked for the most up-to-date "unpaid bills" report or similar output from their computer system. We asked them to sort it by payer class so we could zero in on specific issues. When we separated this report to expose cash versus insurance money due. the reason appeared loud and clear. The Problem There were several reasons to panic at this point. The biggest one was the outstanding total on the Medicare section of the aging report that exceeded $1.25 million. That amount stuck out like a sore thumb on this analysis, and when we dug deeper into this situation, it became painfully obvious that there was more going on than met the eye. This practice was functioning as a DC/PT practice with a physical therapist and chiropractor involved in the treatment process. The PT owned part of the practice (legally acceptable in this state) and the DC was buying into tliat practice while trying to run a separate DC practice parallel to the physical therapy practice. The PT was not in the office every day and had the DC do some of the physical therapy examinations. Sometimes, the DC had to perform physical therapy sen ices as a physical therapy assistant under the direction of the PT. Nobody in the practice knew tliat Medicare lad a $ 1900 annual limit on PT sen ices. Sadly, most of these balances in the Medicare aging report would likely never be collected. Further investigation brought to light even more disarray. Ownership papers were not properly prepared. Medicare enrollment was jumbled between two companies, two tax ID numbers, and providers were providing sen ices in one company in which they had no authority to bill due to lack of Medicare and other third-party registration. Because Medicare and main other carriers were not paying, nobody collected any co-payments from the patients, claiming that they had no idea what to charge. Now that it was months beyond the treatment dates, it was unlikely that billing the patient would produce a favorable result. Worse, when looking at the sen ices billed, the coding used, and the documentation recorded, it appeared tliat erroneous and perhaps even fraudulent billing had taken place. The Solution Several obvious predicaments were uncovered that should be avoided at all costs. The sad truth is that nobody will be able to recover more than half of the $2 million in sen ices that was mishandled, incorrectly billed, and neglected. This doctor paid tuition to the Universal School of Hard Lessons Learned to the tune of $1,586,000 in uncollcctable revenue for sen ices already rendered. We can all heed the warnings, red ilags. and other experiential punishment this doctor suffered. Here arc some of the pitfalls you can avoid to ensure you never have to go through something like this: 1. Never engage in business practices that involve a tricky, complicated setup without the advice and direction of an excellent healthcare attorney. Wc"rc not selling fishing rods: we are a highly regulated industry. We have to comply with a myriad of rules, regulations, and laws that affect healthcare billing and practice. Don't try to do that on your own. especially without a law degree. Its your name, license, reputation, and character on the line. 2. If your livelihood depends on your sen ices, what you bill for them, and how that money is collected, don't leave that to chance. Ensure that the team members you" vc put in charge of your cash flow arc properly trained, managed, and monitored by someone who knows what's going on. If that's not you. then find out for yourself, or hire an outside entity to look foryou. It's too important just to assume it will all be fine. This doctor wished she'd called us months earlier. 3. Never mess with Medicare. It's the government, the Office of Inspector General (OIG). and all of the various agencies charged with preserving and protecting the sacred nature of the US tax dollar used to pay those bills. If you are not enrolled, don't touch a Medicare patient. If you arc a chiropractor, provide chiropractic care. It"s really quite simple, but a misstep here can cost money, time, and perhaps your career. 4. Install systems that empower you. the doctor, as the owner of the clinic to include "business owner" time in your schedule with proper reporting from your team members. There is simply no excuse for accounts receivable to explode to more than $2 million without the doctor knowing or taking action. While your numbers may not be at tliat level or your situation as sticky, can you say with certainty that you know everything you should about the balances, appeals, and follow-up going on? That's your money, your business, and thus, your prerogative to be infonned and invested in the routines and procedures that govern them. While this illustration may seem extreme, it actually liappencd and things like this happen almost even day in our profession. Create and manage your practice around a structure of compliance, order, and organized efficiency, and collect every dollar you have earned. Kathy Mills Chang is a Certified.\ ledical Compliance Specialist (MCS-P) and. since 1983, has been providing chiropractors with reimbursement and compliance training, advice and tools to improve the financial performance of their practices. Kathy is known as one of our profession's foremost experts on Medicare and can be reached at (H55) TEAMKMC or infoflkmainiversity.com
