Financial Policies That Make Dollars and Sense
FEATURE
Ray Foxworth
Last week, my office received a call from a panicked provider. An insurance company had sent him a letter notifying him that, from now on, he would be paid a maximum of $60 per visit. Unfortunately, letters like this one are all too common. He was concerned about providing care for his patients and at the same time surviving in practice. As reimbursements continue to diminish and post-payment audits and denials continue to rise, what are we to do? Take a deep breath and remember that it is all about balance.
Just as your financial planner encourages you to diversify your investments, I encourage you to diversify your patient base. The old adage of not putting all of your eggs in one basket couldn’t be more true. If your patient mix consists of private pay, workers’ comp, personal injury, Medicare, and cash, then one insurance company drastically reducing their reimbursement rate won’t have as much of an impact. We are all too aware that insurance benefits are limited and most likely won’t cover all of the care that our patients require. It is time for us to begin telling patients that their insurance was not designed to cover them from cradle to grave. I want to expose the lie that if insurance doesn’t cover it, they don’t need it. We need to realize that while there is care that is considered “medically necessary,” there is also care that is considered clinically appropriate, and it is just as important—if not more important—than the crisis care covered by insurance.
‘ * Just as your financial planner encourages you to diversify your investments, I encourage you to diversify your patient base. * *
There are steps that we can take as providers to help maximize revenue in our practices.
1. Evaluate your fees annually. I cannot think of anything more important than reviewing your fee schedule on an annual basis. I often hear of providers who have not updated their fees in more than five years—or worse, never. We may think of ourselves as great chiropractors, but if we don’t think of ourselves as a business that must remain profitable, then we may be out of business and unable to help patients no matter how skilled we may be.
2. Determine what you should charge for services in your practice. How did you determine your fees? I hope you didn’t get together with your buddy down the street and charge what he was charging (or less) to be competitive. For starters, how did your buddy decide what to charge? Was it based on your cost of doing business plus a profit margin, or did he decide to use the chiropractic calculator and pick the number between what he could be paid from insurance and what his cash patients could afford? My advice is to visit www.fairhealth.org to determine the average fees in your area or seek the help of a consultant.
3. Review published fee schedules in your state. A few
years ago, we surveyed hundreds of providers in one state and found that more than 80% of them were charging less than the published fee schedules for workers’ comp and personal injury. By not charging at least the allowable amounts, these providers were losing thousands of dolíais in revenue. Pull the workers’ comp and personal injury fee schedules, if available, and decide if you want be paid at least what the insurance companies think your services are worth.
4. Review your provider agreements. In a recent survey,
77% of the public respondents to one of our internal surveys stated that they would choose an in-network provider over an out-of-network provider. This doesn’t mean that you should become a provider with every major carrier in your area. Read the agreement. What is the reimbursement rate? If it costs you $25 to perform a service and they only pay you $20, does it make good business sense to be a part of that network? The reality is that there are some areas where reimbursements are below our cost of doing business, and we may need to be on these panels in order to generate sufficient traffic into our practices. Again, that is a decision only you can make based on who the payers aie in your area and how much market share they have. There aie ways to be competitive as an out-of-network provider.
5. Consider joining a DMPO.
Discount medical plan organizations help bridge the gap between keeping care affordable for your patients and keeping you out of trouble with auditors and regulators. It is a valuable first step in establishing a compliant financial policy that meets all layers of regulations from your local boards of examiners, all the way up to the Office of Inspector General (OIG). There are many to choose from. Be sure to find the one that is the best fit for your practice. Some allow you the flexibility to set your own level of discounts, while others dictate the level of discounts much like your provider agreements. You must know your cost of providing care to make sure you aren’t agreeing to accept less than what it costs you to render care.
6. Conduct a financial report of findings. I would like to think that I saved the best for last. Now is the time for us to be more transparent with our patients about the cost of the services
they receive in our offices. By not telling them the actual fee for the services they receive, we are helping create confusion about the products and services we provide. Additionally, patients need to know what their insurance will and will not cover. Today’s patient is a healthcare consumer. In fact, they aie not that different from you and me. They aie looking for relief when it is convenient for them and at an affordable price. This is an excellent time for you to let them know that they can feel better, you can accommodate their schedule, and even though their insurance won’t cover everything, it will certainly help. If you have a DMPO in place, this is an excellent time to show your patients that you have gone the extra mile to provide affordable care.
No one said that being a chiropractor and business owner would be easy. The multiple layers of rules and regulations that affect our profession have certainly made it tougher in the last decade. I can’t speak for you, but when I attended chiropractic college, I did not envision days filled with paperwork. I saw myself helping my community overcome the aches and pains from living life. I did not give much thought to compliance, insurance reimbursements, and fee schedules. The reality is that we do need to spend time focusing on the business so we can remain profitable and practice with more peace of mind.
Dr. Ray Foxworth is a certified medical compliance specialist and president of ChiroHealthUSA. As a practicing chiropractor, he re-
mains “in the trenches” facing challenges with billing, coding, documentation, and compliance. He has served as president of the Mississippi Chiropractic Association, former staff chiropractor at the G. V. Sonny Montgomery VA Medical Center, and is a fellow of the International College of Chiropractic. To request a free one-page financial policy, send an e-mail to infoachiroheahhusa. com.
