The Hungry Payer

If you give a pig a pancake... Everyone knows what happens in that children's book. The pig wants more, and more, and more. We don't have to spell out the analogy. Insurance companies have been taking pancakes from providers for years. Every year, they come back for more. Recently, Pacificare was found guilty of incorrectly processing 30% of claims. Give an inch, take a mile.

Make no mistake, providers are locked in a power struggle with insurance companies, who have the advantage in size, technology, people, and processes. It costs more today to fight for proper reimbursement than ever before. And the payers are escalating the battle. Post-payment audits, refund requests, underpayments, partial payments, late payments, and flat-out denials proliferate and constantly knock practices off-balance. They waste time, energy, and focus.

Recently, practices have asked: "Is it worth it?" "Why don't we just accept whatever they pay us instead of fighting for what's ours?" On the surface, it seems plausible -- save a lot of money, time, and energy on fighting a $10 "processing error". It costs more to fight for the $10. But the results can be disastrous. Giving up $10 today tells the payer that we're content with the lower reimbursement. The next step is to ask for more. $10 turns into $15, $20, the entire payment. Reimbursements drop lower and lower -- an endless spiral.

But that's not the worst part. Lack of action on certain denials may red-flag an office for a costly audit. For example, if services are routinely submitted and denied pending medical records, and a practice refuses to send the records, the obvious conclusion is that the practice doesn't have those records -- a nice juicy target for an audit.

We know that appeasement is not a long-term solution, especially when practiced with an adversary who is constantly looking for ways to fatten the bottom line. The only solution is to fight. But how?

Outsourced Billing

Hiring staff to fight for claims and take action on denials is not for everyone. Staff adds a fixed overhead and needs constant management. Vacation days, sick days, health insurance -- all take their toll on a small business. And then there's the constant, nagging question: "Now that I have an effective biller, what happens if I lose them?"

Small practices often turn to outsourced billing companies to fight for their money, entrusting the billing company to carry the fight for them, without distracting the practice from its primary mission of serving patients. But not all billing companies are created equal.

Traditional Billing

The term "billing company" describes precisely what traditional outsourced billing services do: they bill. Their entire business model is wrapped around entering charges into a billing system and filing the claims on behalf of the provider. Fighting for claims is an afterthought. When the overworked billing company staff has time, they look through aging reports and call on outstanding balances. Thus, a practice that entrusts a traditional billing service with fighting for reimbursement very often suffers from lower collections than when they were fighting for reimbursement in-house.

Fighting Services

Enter the new breed of billing services: Claim Fighting Services. Claim Fighting Services are built around follow-up. Everything else supports that. Unlike billing services, fighting services are built from the ground-up to wage war for reimbursement. First, they have dedicated staff for follow-up. The follow-up staff has no other job. They are the soldiers, and they are never distracted from their mission. They make up the bulk of the fight services staff.

Next, fighting services automate everything possible that distracts from the fight. Claim entry is done at the provider's office. Errors are flagged up-front and dealt with at the time of service. Claim submission is fully automated. Reimbursements are auto-posted where possible. Nothing extra is added. Every feature is focused on one thing: helping the fighting service fight for reimbursement.

Fighting services require accountability. Every biller (read soldier) has a workbench -- a target list -- that tells them precisely which claims to work today. Managers oversee the process and make sure that workbenches are completed daily so claims never wait more than necessary before being sent back to the payers. Accountability works both ways. A significant portion of claims need provider input before the fight can continue. Fighting services have a system to make providers accountable so that every claim is worked, even if it needs provider input.

The Long Road Ahead

Fighting services are not a panacea. They are only as effective as the providers that they represent. They form a partnership with the provider, in which the key ingredient on both sides is commitment. Commitment to continually improve the process on both sides. Commitment to keep open the lines of communication between the provider and the service to prevent payers from sowing the seeds of doubt. Most of all, commitment to work together to surmount all obstacles and make the payers pay.

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