In one single word how a private consultant surgeon can achieve the financial reward for all his efforts.
Every single time you perform an outpatient clinic the details are passed on.
Invoices can then be raised and sent to either an insurance company or self-funding patient for payment.
Every single time.
Do NOT make the mistake of collecting them ready for “later in the month” because “later” never comes. Or at the very least you are risking an issue coming up which will either delay or cause invoices not to be raised at all.
Instead after every outpatient clinic the details are passed over for invoicing. I’ve got some clients who actually take a photograph of their clinic list on their smartphones and send it to me securely. It’s a ritual with them.
Is it any surprise such private consultant surgeons get paid quickly? Other MHM clients have the clinic list (s) sent over every Friday afternoon without fail. They get paid quickly too.
It’s a ritual for them.
Contrast that with another MHM client who sends all the data over infrequently.
Sometimes at the end of each month or more often than not every couple of months or so.
This client does not get paid as frequently as the others.
The reasons are somewhat obvious.
Ritual is also applicable when dealing with excess or shortfall payments. The moment you are notified, you MUST action them for the longer they are left unattended the danger of non-payment increases.
I check every single remittance advise a private medical insurance company sends in. Any and all shortfalls/excess deductions are actioned the very same day.
It is a ritual.
Religiously – MHM check every single piece of data BEFORE an invoice is submitted for payment.
The policy number is checked to see if it has changed.
The patient’s date of birth and postcode is checked to see if that has altered.
The CCSD code is checked and the fee also checked against the appropriate insurance company’s fee schedule.
If there is a discrepancy, it is corrected.
Then – and only then – is the invoice submitted for payment. Religiously.
So how does just doing these two things contribute so much to a private consultant surgeon achieving his rewards?
Both cut down the opportunities for payment to be delayed, queried or not made substantially.
pete@medicalhealthcaremanagement.co.uk
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What follows is absolutely real and why medical invoicing can be more troublesome than it need be.
One of my guys ran an outpatient clinic last Thursday
The clinic list arrived with me on the next day. There were 8 patients: 3 initials and 5 follow-ups.
Within 30 minutes 7 invoices had been produced and delivered to the various insurance companies but that final EIGHTH invoice caused significant issues. Why?
The patient’s insurance details had not been recorded correctly.
So I rang my client’s medical secretary and ask if she knew what they were. The FIRST phone call – I’m told the patient is with insurance company A but did not know his policy number. Length of the phone call: 5 mins
A SECOND phone call was necessary. This time to the insurance company. I was on hold for 11 minutes to this particular insurance company which is about normal for an insurance company. Some are 4 – 5 minutes. With some, you are on hold for considerably longer.
Once I got through however despite having the correct name, date of birth and postcode I was informed the patient’s policy had lapsed.
Length of the phone call: 11 minutes plus 5 minutes = 16 minutes.
A THIRD phone call was made. This time to the patient. Answer machine so I left a message to call me back. He did. The patient confirmed it was totally the wrong insurance company. He told me the correct insurance company but did not know his policy number!
Length of phone call(s) 5 minutes
A FOURTH phone call to the other insurance company. Placed on hold for TWENTY-THREE minutes! Finally, get through and I’m advised the correct policy number, etc. Invoice raised.
The total length of phone calls: 49 – FORTY-NINE MINUTES!!
There is no problem with spending 49 minutes on the phone; none whatsoever.
But just consider the problem if the medical secretary at the same time as that had patients trying to speak to her? Or she had correspondence to get out? Or she had clinics to book?
She would have struggled for sure.
Finally, consider how much easier it would have been if the patient had been asked to bring a copy of their insurance details with them when they registered.
pete@medicalhealthcaremanagement.co.uk
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Don’t say – “all the details should be obtained”.
Say “all the details MUST be obtained”.
In other words, turn “should” into a must. But why is this so important? And why must you do it every day?
Many clients have asked why mhm obtains payment so quickly from insurance companies or from a self-funding patient.
The number one reason is that I don’t use the word “should”.
I use the word must.
And that is why it is so important – the consultant surgeon gets paid quicker. When I work alongside a medical secretary – the most underappreciated person in any medical practice normally – I emphasise the absolute need to get all the patient’s details.
For example: make sure the details are correct, make sure the patient’s policy number is correct, make sure the patient’s date of birth and postcode are correct.
When should this be done? NOW. It should be done every single time you have a patient in front of you or are reviewing a patients details.
Once all the details are correct – as they must be – the chances of getting paid increase dramatically.
This isn’t done in an aggressive manner at all.
In fact, 99.9% of all med-secs understand the reasons why and are only too glad to help.
Most likely because most med-secs do not like “accounts” or “having to chase for money”
In other words, it is a state of mind. It is a state of mind supported by the very strict adherence to a number of routines.
Actually the word routine itself is not a strong enough.
It’s a discipline.
It is the discipline to make sure all the details are obtained when the patient registers.
It’s the discipline to make sure the clinic list is sent down to me every single week.
And finally, it’s a discipline to make sure all the invoices are raised, checked and delivered either to an insurance company or direct to a self-funding patient.
And that’s why mhm clients get paid so quickly.
pete@medicalhealthcaremanagement.co.uk
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All MHM clients are very dedicated individuals. Having spent approximately 15 years of training and to become a consultant surgeon, they then go on to work incredibly long hours.
They do so because they actually love what they do.
All at some point, however, have taken the decision to start a private practice.
It’s unlikely they would be my clients otherwise if you think about it. They start a private practice because they wish to make more money doing what they love. To have any other objective is either (a) silly or (b) engaging in self delusion.
There is no shame in admitting you start a private practice to make more money.
At that point however your private practice becomes a business.
As I’ve blogged many times, it must, therefore, be run as a business. A business with more than a little social conscience but nonetheless still a business.
Yet, sadly, many consultant surgeons make the mistake of believing their practice/business will grow and make them rich if they continue doing what they love to do. Sadly that is not true for doing what you love seldom leads to long-term financial success.
And that means, as much as you love being a Private Consultant Surgeon, you must measure the performance of your practice/ business.
This is the point the private consultant surgeon realises he/she must learn to understand financial analysis i.e. the numbers. It’s not all that complicated actually.
Supplying data to your accountant every year isn’t the same as understanding the numbers behind your practice though.
Let me give you a real example.
I was contacted recently by an established private surgeon who, he claimed, appeared to be working all the hours God sends but said he was always broke.
It didn’t take long to work out why.
The first good indicator was a complete lack of financial analysis other than a tax report a little over one-year-old. No debtors ledger was available so the surgeon didn’t have any real idea how much he was owed.
It transpired both patients and insurance companies were only invoiced monthly.
So I took the last six months worth of clinic lists and checked how many had or had not been invoiced. Quite a lot had not.
I did the same with surgical episodes with the same result. This was followed by an investigation into how much had not been paid even if invoiced.
But it was also a simple case of adding up the total revenue generated for each month, calculating the total costs (room rental, monthly indemnity insurance premiums, secretarial costs etc) and subtracting one from the other.
Even if any type of provision was made for tax liability was ignored (bad move!) the results were not encouraging.
The really bad news is that the consultant looked very blank when I asked which percentage of patients were referred to him from which source i.e. how many GP referrals, private referrals, recommendations from previous patients, insurance company referrals etc.
It was clear this particular consultant had no real idea of how his practice or business was performing.
And that was and still is a very dangerous place for any business to be.
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An interesting question asked by a consultant starting her own private practice.
And a question I couldn’t really answer.
What I could do was interrogate, based on a month’s worth of outpatient clinic lists for existing clients, how long-established private consultant surgeons allowed for consultations.
A number of different specialisms were covered. They included: three orthopedic surgeons (one foot, one knee, one hand). An ENT surgeon. A gynecologist. A dermatologist A GI surgeon, and an ophthalmologist.
The average time for an initial consultation was 30 mins.
Some were under 20 mins. Some much longer. But the average was 30 mins. To further investigate why I asked each consultant why it took as long as it did?
And got precisely the answer I expected. Some patients required more time to examine, explain and discuss their condition than others. Not one consultant allowed a “maximum” amount of time.
When asked why, for example, they had allocated the length of time they actually had, most made the same comment. It was based on their experience together with the recommendations from colleagues whom they had asked.
To get an understanding from a private insurance perspective, I asked the same question of various insurance companies.
They too shared the view that 30 minutes was about right. All had no fixed time “allowance” for an initial consultation. Two, however, were concerned that one consultant only allowed 20 minutes for an initial consultation.
The same process was followed when the question of follow up consultation was examined.
Unsurprisingly, the time taken for a follow-up consultation was shorter.
The average time taken was 20 minutes. One consultant allocated just 10 mins; another 30 mins.
Yet across the various specialisms, the average was around the 20-minute mark consistently.
Again, insurance companies were asked the same question regarding follow-up consultations. Again there was no fixed time “allowance” for a follow-up consultation.
But the question remains for the consultant setting up her own private practice relevant. Why?
If she had allowed 60 minutes for a consultation, she would see only two patients per hour.
At say £125 per consultation, she would charge £250 per hour.
But if she allowed 20 minutes per consultation, she could see three patients each hour. She would be able to charge £375 per hour i.e. 50% more (£125/£250)
Whilst 60 minutes for a single initial consultation is most likely not required, it is the principle being looked at. The same would prove true of follow-up consultations if the fee were £95 per consultation.
Two per hour = £190 whereas three per hour = £285.
Paradoxically, I have a somewhat pragmatic view as I suggested to the consultant just starting her practice. It is highly unlikely she would have so many patients as to require the question to be investigated as we have done here.
No MHM client, I’m very pleased to say, actually cared how long the consultation took. And that is how it should be. They were only concerned with providing the best medical care and attention they can.
pete@medicalhealthcaremanagement.co.uk
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I’ve been asked to revisit why coding is such a big part of medical invoicing.
It is integral because without the correct code the chances of getting paid decrease. It is unlikely if you wish to invoice electronically you will be able to invoice without a code anyway.
Insurance companies use medical coding to identify and detail a procedure. For example, an Orthopaedic surgeon will understand precisely what a Multiple arthroscopic operation on the knee is.
But that’s a lot to put on an invoice. Plus there may be variations in the episode.
Instead, use the code W8500. That will specifically identify the surgery you have done.
If you are planning to invoice electronically you won’t be able to input the whole description anyway.
So where do you find the code?
CCSD codes can be located on the CCSD website.
www.ccsd.org.uk
The Clinical Coding and Schedule Development Group (CCSD) consists of the five major healthcare insurers – Aviva, AXA-PPP, BUPA, Simply Health and Vitality Health.
Its main purpose is to maintain a common standard of procedure codes. Such codes reflect current medical practice within the private healthcare sector. They are published as the CCSD Schedule of codes.
The various insurance companies will, therefore, recognise the majority of codes.
However, a word of caution.
Whilst the example above of W8500 will be recognised, a CCSD code does not come with a suggested fee rate.
The fee rate for each code is up to the individual insurance company concerned. To find the correct fee for the code, you will need to check with that insurance company.
For example, the W8500 mentioned earlier carries a fee of £615 for one insurance company. For a different insurance company, the fee may be £550. If you charge £550 instead of £615 by mistake, you will NOT have your fee increased.
If however, you charge £615 when it should be £550, your fee will be reduced.
Whilst not so important for consultations, a CCSD code is imperative IF a surgical episode is required. The patient must quote the code to his or her insurance company when pre-authorisation is being requested.
When an invoice is sent to the insurance company, the code should appear on the invoice, This will reconcile to that expected by the insurance company.
If alternatively, you do NOT use CCSD codes payment will be substantially delayed if made at all!
pete@medicalhealthcaremanagement.co.uk
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I had a really illuminating conversation with a guy who called me recently. He ran a marketing business and was a specialist in using Twitter.
Basically, the guy told me he’d been looking at my website for some time.
He had been monitoring the number of Tweets I sent out. He’d been reading all the blog articles – they were brilliant.
Appealing to my vanity – really you shouldn’t but it got my attention.
Actually, he’d found my details because he was a Tweet follower of and ‘tweeted” on behalf of a consultant surgeon who in turn was a Tweet follower of me.
Thus he’d be watching MHM for some time.
He was confident he could dramatically increase the mhm social media “footfall” and its Twitter presence by sending out at least 10,000 tweets a day on my behalf.
As he had done to his consultant surgeon client, he charges for his services as he rightly should. There is no problem with a price being attached to the service.
I genuinely have no objection to paying a price for a service.
Most people expect it for free or as near to free as is absolutely possible.
But I’ve always followed the mantra if you think an expensive professional is costly, try using a cheap or even a free amateur.
I also believe in Warren Buffet’s mantra of “price is what you pay, value is what you get”.
So I asked bearing in mind MHM clients are orthopedic surgeons, ENT surgeons, gynecologists, anesthetists, physiotherapists, and other medical professionals, how many consultant surgeons would receive the “tweet”?
In other words, how many would receive a Tweet that was relevant to THEIR needs?
My newly acquired friend wasn’t sure.
Instead, he stated that all the tweets would be seen by “professionals!
For example electricians, engineers, social media specialists and newspaper publishers” That is not to suggest such professionals are anything other than perfectly respectable occupations. Of course, they are.
I’m sure they are fully engaged in social media too and good luck to them.
But they are hardly likely to find the MHM offering suitable for them because they are not surgeons.
The crux of the matter, therefore, is why send 10,000 Tweets to anyone not within the same niche as me?
He did not or could not understand this point.
What he did understand though was his request that once MHM became one of his “clients” I would pass over to him the list and database of all my contacts who WERE consultant surgeons.
Just as the consultant surgeon mentioned earlier had done. Or so he claimed for he would not divulge the name of his client (about the only thing I was starting to respect my new friend about).
Many, many people from a variety of organisations have asked for this list.
A polite decline normally satisfies such a request but if pushed far enough its greeted with the immortal “which part of the word NO don’t you understand?”
Meanwhile, I still do not understand why sending 10,000 tweets a day out to anyone who is not in the same market as MHM will ever benefit MHM.
More so, if MHM’s marketing strategy – just the same as a consultant surgeon – pursues a pull marketing approach and not a push marketing one.
Actually, I asked the question. Never mind MHM sending 10,000 daily Tweets out.
Why would a consultant surgeon want to send 10,000 Tweets out a day to anyone who is not a potential patient?
But hang on a second?
My newly acquired friend claimed to have been studying and reading MHM’s website for some time.
Yet he was still to understand, MHM Ltd only works with consultant surgeons, anesthetists, physiotherapists, etc.
Either the website doesn’t make this clear (it does), he didn’t understand or he didn’t want to understand.
MHM is not likely to find more clients if it targets electricians, engineers, social media specialists or newspaper publishers. Nor is a consultant surgeon likely to find more patients if he or she Tweets the same audience.
No-one is suggesting Twitter can’t help a business. It can.
What I am suggesting is that in a specialist market, you need a specialist and not an amateur. In MHM’s world, many claim medical invoicing and medical accounts is easy.
Some have no issues at all.
Some have major issues and ring us.
Some however either don’t know they have major issues or bury their heads in the sand hoping the problem will solve itself.
It never does. Then they call a specialist in.
pete@medicalhealthcaremanagement.co.uk
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During a conversation with a friend of mine recently, I pointed out that our clients had some things in common.
For one thing, they are consultant surgeons.
And that means they are all supremely qualified. They are right at the top of the game. They have to be because the patient’s life is sometimes – literally – in their hands.
Knowledgeable
Then my friend made a really interesting point.
He said as a surgeon (he IS one) both he and other consultants are VERY used to asking for a second opinion from another consultant surgeon.
Yet he could not understand why when it came to running their private medical practice, there seemed to be a reluctance to go out and seek the opinion of an expert in running a private medical practice.
Maybe its because after all the years of training, our clients are so highly trained and skilled they are almost hardwired to perform in a certain way.
What is curious is that other professionals i.e. non-medical professionals have a similar tendency.
They too are reluctant to ask for expert help.
And there is nothing more dangerous than someone who thinks he knows but in reality doesn’t.
What don’t they know?
Worse still when he does not realise what he knows is wrong or inappropriate.
Silly example: my partner and I were having dinner with my friend and his wife recently.
My partner (Lord knows why) enquired why ladies were required to remove nail polish or nail gel if they were having a surgical episode?
In her opinion it was unnecessary.
Because, according to my friend, the theatre staff attach monitors to the patient’s fingers to monitor her and nail gel causes problems with the connection.
He knew what he knew but my partner didn’t know what she didn’t know.
So she asked.
pete@medicalhealthcaremanagement.co.uk
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I was asked to speak with a colleague of a current MHM client recently.
He was having problems with outstanding invoices both from insurance companies and from self-funding patients.
He, in turn, asked me to speak to the person who “looked after the accounts”. There were four consultants in the practice, all of whom were “looked after” by the same person.
That was on Monday, April 9th.
I duly called on Monday August 9th. And again on the 10th, the 11th, the 12th.
Then I gave up
Each time I heard an answering machine say “this is XXX of the YYY Clinic. I’m not here to take your call. Please email me on xxx@yyy.co.uk. Note emails are only checked periodically. Or leave a message; please note I only work part-time”
So I left a message. I emailed too.
Nobody called me back.
Nor did I receive a return email.
Then I was naughty.
Every single day this week I have called. I emailed as well. Each occasion I left my name and said I thought I owed for a consultation and wanted to pay so would XXX call me back, please? Each email said the same thing. I wanted to pay.
Nothing. Not a sausage.
Skip forward to today Friday August 20th and I called the colleague of the MHM client and explained what had happened. His accounts person had been at work last week so he couldn’t explain why I hadn’t been able to contact his practice for two whole weeks!
For the record, I was not and am not looking to completely bury his accounts person.
That said, and also for the record, as I said to the consultant concerned, you can have the best invoicing, billing or payment process on the planet for all I care.
If you don’t make it easy for the patient to contact you and resolve issues/pay an invoice you will have SIGNIFICANT problems.
pete@medicalhealthcaremanagement.co.uk
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I argue with medical insurance companies all the time.
Let me, however, be very specific about when and why I argue with them. I argue with them when I think they are wrong or when I think they have made a mistake.
A real example will illustrate why and when to argue with an insurance company.
MHM has a client who performs a specific test at a consultation with a patient. He has done so on more than one occasion obviously and with patients holding cover provided by all the major insurance companies, I’ve invoiced for him many, many times. Per normal MHM won’t reveal who the client is, his specialism or indeed the true value of his charges. For the purposes of this example please assume the charge is £125 for the consultation and £75 for the test.
The invoice was raised and sent electronically to the insurance company. It detailed all the correct details i.e. patient’s name, complete address, date of birth, policy number, pre-authorisation number. The correct CCSD code for both the consultation and the test were used. It also indicated the correct price for each and a total value for the combination involved. In other words xxxx (the consultation) = £125. The yyyy (test) = £75. Total value = £200.
Surprisingly, when the remittance arrived electronically from the insurance, only the consultation had been paid. A note appeared on the remittance advice stating it was not possible to charge for a consultation and that particular test at the same time.
Except, you can.
Before picking the phone up to call the insurance company concerned I first visited the insurance company’s website. The codes were correct. The fees for each code were correct. There was no indication that the combination could not be charged alongside each other whatsoever. I was pretty certain even before I’d checked that I was right but it doesn’t hurt to check. I could have been wrong. More likely it could have been that the rules had been changed.
Establishing the facts is vital when raising invoices for medical billing. Actually its true of all commercial situations but is dependant on what is deemed to be a fact. What some claim to be facts turn out to be anything but sometimes. In this case, though the facts were as I thought them to be. It was perfectly acceptable to charge the two codes together. Only then did I call the insurance company.
Having passed the normal Data Protection requirements i..e patient identifiers etc, I asked WHY this particular charge had been reduced? It was explained to me that the combination was invalid. It was unbundled as they say. Except I insist it was valid, was not unbundled and further, the insurance companies OWN website said the combination was permissible. The phone went quiet for a while and then I was told the insurance company was wrong and I was right. The £75 would immediately be paid to the consultant involved.
Despite what you may think it is not unusual for an insurance company to make a mistake, admit they have made a mistake and then rectify it straight away.
Don’t, however, call an insurance company and twist the facts. By that I mean don’t call them and say their fee isn’t right and should be much higher. That is not a fact, it is an opinion. When faced with a combination of codes that can’t be charged together do NOT separate them into two invoices one being sent on a Monday and one on a Tuesday. Don’t unbundle in other words. Insurance companies may make mistakes but they aren’t stupid.
Its very much a case of “picking your arguments” and challenging an insurance company in the right way and on the right subject.
But is also very, very much a case of noticing that the insurance company have made a mistake and asking them to rectify it. The number one statement made to me by private consultant surgeons is that fees are too low (I agree for what its worth) and that insurance companies are really, really difficult to deal with. They are not.
As regards fees, however, if you want to increase your fees the first port of call is actually to check you have a) charged the right amount to begin with and then b) making sure you ARE ACTUALLY PAID the right amount. In the example above the £75 wasn’t lost, it was paid to the medical professional concerned.
Look at it this way. His total charge was £175. If I hadn’t noticed the £75 had been deducted in error, he would have received 43% less than he was perfectly entitled to be paid!
pete@medicalhealthcaremanagement.co.uk
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Having analyzed where the private practice is both in terms of outstanding accounts, it is important to have a structured and rational action plan.
Why do it this way though?
On numerous occasions, MHM has been called in when previous attempts to resolve an accounts issue have failed. The number one cause of this failure is the tendency to mistake movement for action.
For example, one group of surgeons had previously ordered all outstanding invoices be resent to insurance companies and self-funders. This was always doomed to fail.
It didn’t take much to work out that if invoices hadn’t been paid in the first place as they were wrong, sending them out again wouldn’t achieve anything. It didn’t.
If you wish to reduce the amount of money you are owed, the first thing you should do is to ensure the amount does not get higher!
If you do not know precisely where you are now, you will NEVER reach your destination. Do not think you know where you are. Make sure your core data is robust, up to date and accurate. Then keep it that way! Otherwise, over time you will go backward.
You MUST ensure your invoices are completely accurate. INVOICE RIGHT = GET PAID RIGHT! This means checking your CCSD codes, checking the fee for each code across all insurance companies, checking you’ve got all the right patient details, etc. INVOICE RIGHT = GET PAID RIGHT!
There is simply no excuse for not posting payments to your debtor’s ledger.
If you do not, then very rapidly your data will become useless. Recently, a consultant surgeon claimed to me posting payments to a sales ledger was not as important as chasing invoices for he was in his words “more interested in what hadn’t been paid than what had”.
This almost certainly was the origin of £’000 worth of unpaid excess and shortfalls which he was horrified to discover existed but that he was completely unaware of.
If payments are monitored then identification of excess/shortfalls is quicker. It was also put your practice in the position of being able to do something about them. That must mean contacting the patient and having a robust process to ensure excess and shortfalls are collected. Failure to do so WILL cause all sorts of problems for you.
Do not mistake movement for action.
It literally is similar to building a house. If the foundations are not solid, the chances are the house will collapse. Yet some consultants make the mistake of “actioning” an accounts issue without establishing what really is the cause. Do not become one of them!
The bad news is whilst the original identification and investigation of each step should be allowed sufficient time to be completed correctly, as they impact on each other so much, implementation of an action plan, should be done all at the same time.
The ultimate management challenge – how to change but stand still all at the same time!
If you know what to look for and have devised action plans before, this whole process can take around two weeks. If you do NOT know what to look for and devote enough dedicated resources (and there are many, many more points than have been covered in four blog posts) allow for about 3 months worth of trial and error.
Most likely if you are experiencing issues with getting paid, not devoting enough dedicated resources caused the issue in the first place.
pete@medicalhealthcaremanagement.co.uk
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Recently, we established how to find precisely where your private practice is as regards debtors. Now we need to look at the invoicing process.
But Do NOT react to a high level of outstanding invoices by immediately sending hundreds of copies out.
Step back instead and consider if the problem may not be external.
For example, one group of surgeons in a knee jerk reaction when faced with outstanding invoices sent thousands of copies out.
Almost immediately the switchboard lit up. Some callers claimed the original invoice had not been received. Others said it had already been paid or the invoice should have been sent to an insurance company.
Fine. It got a reaction. Sadly, however, only a small percentage of payments were received as a result.
Hence the need to step back and consider the CAUSE of the problem.
Start with how the invoice is delivered to the patient’s insurance company or directly to your patient.
If you haven’t delivered your invoices electronically (by EDI) to an insurance company, you are on the back foot straight away.
EDI is pretty much guaranteed to deliver an invoice to an insurance company.
But if you have already sent the invoices by EDI and they still haven’t been paid it is a good indication your invoices are incorrect.
Contrary to the claims made by some, insurance companies are not the enemy. They will not wilfully withhold payment to a provider. I’ve never known it.
If your invoice is wrong, however – incorrect fee, wrong CCSD code, incomplete patient details, etc – then your invoice will be rejected by an insurance company.
Thus it is most likely an INTERNAL reason why you are not getting paid:
The most common internal reason an invoice is not paid, if you haven’t made sure you have all the right details on your invoice.
How many times have I written: INVOICE RIGHT = GET PAID RIGHT?
This is a must. There is no way around it. It is mandatory. You must tackle it.
Having ensured you are invoicing insurance companies electronically & the data on the invoice is correct, the next item then is an invoice to a self-funding patient.
Invoices to a self-funding patient require pretty much the same amount of detail as those to an insurance company save they need two additional pieces of data on them:
Where they should be paid (your bank details in other words)
and the statement:
“this amount was not covered by any debit/credit card details taken at your hospital”
That last sentence helps to overcome the single most quoted reason a patient calls and claims he/she has already paid for a consultant’s services.
So by now, you know your invoices both to an insurance company or a self-funder are correct and are being delivered.
In other words, you have by attacking the problem put your practice in the position that it may, very soon, start to attack the level of outstanding or overdue debt.
If the amount of debt is high and/or has been outstanding for a while another day won’t hurt. Next, you need to consider if, when and how you’ve already been paid!
pete@medicalhealthcaremanagement.co.uk
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I took part in an on-line medical conference recently and one of the speakers – a well-established consultant surgeon and an incredibly safe pair of hands – stated during his presentation that a private surgeon could not charge for inpatient care.
He may well be a safe pair of hands but on that point he was wrong.
After the conference, I had a word and said he was incorrect. It IS possible to charge for inpatient care.
I couldn’t help but suggest to him that the mere fact there was a separate code for inpatient care indicated it could be charged.
Obviously, it may well depend on the insurance company concerned. In principle, however, it is possible to charge. I knew I was right because I’d actually charged for inpatient care for an MHM client a few weeks earlier. And the invoice had been paid.
But he wouldn’t budge.
He was right.
I was wrong.
Skip forward a few weeks and I received an email from my consultant surgeon friend confirming that I had been right all along and he had been wrong.
Why is it sad that I had been right?
Because my consultant surgeon friend has been in private practice for well over a decade and he’d NEVER charged for inpatient care.
More significantly though, my friend had not checked each month what could and could not be charged for.
That also begged the question if the fees he was charging had been checked with the same frequency too. He hadn’t so as a favour I checked for him.
The good news is that only 3 of his fees had altered.
The bad news is that one of them had gone up £107 five months earlier yet he was charging the old and lower fee.
Thus it is important not only does a Private Consultant Surgeon need to establish what he can or can’t charge for, it is just as important to check HOW MUCH you can charge for!
pete@medicalhalthcaremanagement.co.uk
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It was an environment where chaos reigned.
There was a serious amount of money outstanding but it didn’t take long to work out why.
The problem was the practice principal for he insisted everything had to be done immediately.
And therein lay the problem.
Resolving every problem immediately didn’t allow sufficient thought as to what the problem really was. Nor did it consider the cause or consider the options.
Instead, the problem was receiving less than a minutes attention with the cause of the problem being ignored.
Any and all business require a plan.
Simple said the practice principal because the plan is to see as more patients.
It didn’t occur to him that practice management is important and a business plan is required.
It should not be subject to a stream of quick-fix solutions and absolutely not when the cause of the problem is not established.
Once a plan and goals are defined, the functions of the practice need to be split in two.
Primary and secondary.
The identification of primary productive areas and secondary non-productive areas is done using a value chain. Devised in the mid-’80s by Prof Michael Porter it is one of the simplest things to use. So, what is primary and what is secondary?
Primary: anything directly focused on your patients.
Secondary: anything not patient-focused.
Then what?
Anything secondary should be outsourced. Thus practice staff will be free to concentrate on their primary area. Patients.
The extra time generated allows the practice to speak to MORE patients.
It’s a case of concentrating on what the practice aims are. If you measure your practice against a value chain, you’ll find the primary values are supported by secondary values.
Outsource secondary values and the practice becomes more profitable.
Yet numerous private practices make the mistake of not distinguishing between the two.
With the result, chaos reigns supreme.
The practice doesn’t work as well as it should with patients complaining the telephone isn’t getting answered. But they don’t care because they’ve already telephoned another consultant.
The practice principal disagreed. Secondary “non-productive” areas should be ignored. Concentrate instead on getting more patients. Always more patients.
He still insisted on solving problems immediately.
His only answer was to blame everyone else.
His 150 miles an hour approach might explain why the practice had gone through 4 practice managers in just over 32 months. It also helps explain why his patient numbers have gone down.
He hasn’t avoided the CHAOS FIELD.
pete@medicalhealthcaremanagement.co.uk
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I left school more years ago than I care to remember.
Then as now I make sure I do my homework though.
The only difference is now I do it for private medical consultants some of whom are thinking about starting a private practice.
All of you have done your fair share of homework in the past.
The journey to becoming a surgeon is not exactly an easy one.
Lots and lots of work, study and long, arduous hours. There is lots of homework on the way too. Followed by even more work, study and long arduous hours. There is even more homework thrown in after that.
Then you are qualified.
But to start a private practice add on about five years of post-qualification experience and hey presto you decide to open a private practice!
That is more or less the path a surgeon (friend of a current MHM client) took.
I was asked to go chat with him about starting a private practice.
As the geographic area concerned contained a major urban conurbation, the population numbers were high. So that ticked the first box!.
There were three private hospitals within a 25-mile hospital too. The second box ticked.
When I checked the number of consultants at each hospital (Google is a mine of information) there were 22 at the first, 15 at the second and 15 at the third. The third box ticked.
I’d done my homework and established there was a demand for my surgeon’s specialism within the area.
The surgeon, when we spoke, was really pleased to hear the results and was in no doubt my homework confirmed he would be able to start a successful private practice.
It was that last item – the number of consultants already in place – that concerned me.
Could it be that the demand for his specialism was already being satisfied by the 52 consultants already providing his specialism?
My surgeon friend would have to compete with those consultants.
He would have to market himself to potential patients and see enough patients to make his private practice pay.
His fees from private insurance companies would have to be sufficient to cover his costs AND make a profit.
He would have to provide all the support facilities to run his private practice which would cost money.
Then he would, of course, have to pay tax on whatever was left.
Let me be clear I was NOT saying don’t start a private practice.
I was suggesting that the demand for his specialism might already be satisfied by his competitors.
He should, therefore, be fully aware of the difficulties he would face BEFORE he started his private practice.
All because I had done my homework.
pete@medicalhealthcaremanagement.co.uk
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Not getting paid doesn’t happen by accident.
Something causes it to happen. There is ALWAYS A CAUSE.
If you leave invoicing until later (Friday for instance) it is very easy not to invoice at all. It can happen also if, for whatsoever reason, you leave invoicing until “tomorrow”.
Tomorrow turns into never.
Many times, I’ve been called in to examine and review the billing process of private medical practice and discovered an issue with invoicing frequency. So why is “tomorrow” “Friday” or “when I get the chance” the worst possible words for me to hear?
Nine out of ten times such an approach is a big clue as to the reason why the practice is not enjoying the level and frequency of cash it should be.
If you want to ensure your practice is paid promptly, the very first place to start is raising an invoice. It is crucial. And invoices should be raised DAILY!
Once a week is not helpful.
The danger in invoicing on a Friday or a Monday or only on any set day a week is if something happens that day – for example, the consultant needs a clinic booking urgently or a patient needs a letter immediately, then the invoicing gets left behind.
And that is normally the cause of the problems.
If invoices are raised daily should something happen to delay that ONE day’s invoicing, it is corrected the very next. There is no backlog.
Let me give you a real-life example.
Thursday July 8th a consultant ran an outpatient clinic and saw five patients. Three follow-ups and two initial consultations. £850 worth of consultations.
Yet invoices were not produced for this work until Friday July 30th, – almost three weeks later!
Is it any wonder the consultant was extremely dissatisfied with the practice cash flow?
It didn’t take long for me to identify that on twice previous occasions over the previous few months one entire clinic list had NOT been invoiced (worth £725) and three initial consultations (worth £600) had also not been invoiced.
In the case of the initial consultations, insufficient insurance details had been obtained at the point of registration and remedy had been left until “later”!
In all £1,325 worth of invoicing had been missed.
No wonder cash flow was poor.
But before we go any further do NOT blame the medical secretary. She has enough to do. The phone rings or she has to meet and greet the patients. She has numerous letters to type.
That is precisely what she should be doing for she is there to ensure the “front of house” runs smoothly.
The error, if you will, is then expecting her to fit invoicing in around all that or, as was suggested to me, in her “spare time” WHAT SPARE TIME?
She hasn’t got any and nor should she.
In the above example, the solution was obvious. Either get someone in to process all the invoices and the cash receipts or outsource it.
Private medical practice is a business. It must be managed as a business; end of.
Without putting too fine a point on it, failure to ensure the invoicing and accounts process is not 100% efficient is pretty much guaranteed to lead to the business having cash flow issues.
DON’T LEAVE IT UNTIL FRIDAY – DO IT NOW!!
pete@medicalhealthcaremanagement.co.uk
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Oops.
I had a zoom call with a surgeon recently about surgical fees.
His view was they were too low and a certain insurance company was, in his view, trying to reduce the number of consultants they recognised by keeping fees low.
He went on to explain that since he had been recognised, his fees had always been decreased and never increased.
Curiously he was the second person to make this point in the same week although the second person had heard a rumor surgical fees had gone up.
So when I finished the zoom call I picked the telephone up and called the insurance company concerned.
The insurance company knows me well.
They should do.
As they are one of the major players in the industry and as all my clients are consultant surgeons for whom I raise electronic invoices and send to numerous insurance companies it’s almost certain I’m going to speak with them every single week.
I asked them to confirm the fees for both consultants.
In the case of the first surgeon, he was factually incorrect.
His fees had increased earlier this year and he was charging the wrong fee.
The argument that the new higher fee was still not enough is different from the fact his fees had in fact INCREASED as he and I discussed after I called him back.
But I did urge him to check his surgical fees were correct as of August 2021.
The situation with the second surgeon, however, was more disturbing. Not only had his fees increased, but he was also blissfully unaware they had been increased.
Instead, he had carried on charging a lower amount both for initial and follow up consultations.
He was most unamused to realise he had so far in 2021, undercharged by just over £1,000.
I wasn’t being cruel therefore in suggesting both consultants went out and checked if their surgical fees had altered too.
Funnily enough, both having gone on to read my recent blogs on this issue, they emailed me this week asking if I would be good enough to check their fees every single month.
Conclusion?
Check your fees or get somebody to check them every single month!
pete@medicalhealthcaremanagement.co.uk
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MHM was recently engaged to review the billing process of a hospital with a remit to find out why insurance companies weren’t paying.
One company was proving to be a problem and an analysis of the invoices soon identified why. This company required invoices to be sent on-line.
Except the invoices were inaccurate with, for example, the patient’s policy number being wrong. The invoices could not be submitted on-line for the details were wrong.
Instead, they were put in a “holding” pile.
To resolve the problem, it was vital to make sure the details were correct.
That was the cause of the issue.
Or was it?
It turned out medical secretaries thought the receptionist was responsible but the receptionist thought the medical secretary was responsible.
Then both claimed the person who raised the invoice was responsible. The reality was nobody was responsible.
The holding pile was greater than the value of daily outpatient appointments and it was growing.
The receptionist obtains the details. She then checks them. The medical secretary ensures all are recorded accurately. She checks them again. The person responsible for medical invoicing highlights ANY which fail.
The holding pile is now less than 1%.
Is this overkill?
Cash input from this ONE insurance company has increased by 160%.
It’s not overkilling at all.
pete@medicalhealthcaremanagement.co.uk
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Ever wondered why MHM clients get very regular payments both from Insurance Companies, Private Hospitals and self-funding patients too?
It is down to the above discipline – the ritual – both on the part of MHM and on the part of its clients.
Specifically, every single time an MHM client completes an outpatient clinic or is in theatre the detail is sent to MHM. Some clients send them daily, others send them weekly. But send them they do.
Then it’s a question of ritual.
Every single morning at 8 am, I have the daily discipline of picking up the clinic or theatre lists from the previous day. And then they are invoiced to the insurance company concerned or direct to the patient.
Monday to Friday this is the first job every single morning.
It is a RITUAL.
So how does this daily discipline help MHM clients?
It means payment has been requested on behalf of MHM clients. This in turns means insurance companies are able to process the invoice for payment. Does this sound far too simple?
Well, in reality, it is very simple.
It is literally a question of RITUAL LEADING TO VERY REGULAR PAYMENTS TO MHM CLIENTS.
Paradoxically, I know many medical secretaries who instead raise invoices “on a Friday afternoon” or “after I’ve typed my consultant’s letters”.
The inevitable happens.
On a Friday afternoon, the telephone goes berserk or something comes up that prevents the invoicing from being completed.
Because there is no ritual, the consultant does not get paid as quickly as they think they should. Indeed I was talking to a med-sec last week who was telling me she has a three-month backlog in uninvoiced outpatient clinics.
She wasn’t happy that at 10.20am on Thursday, August 12th I had a backlog of ONE clinic dated from the previous day.
I wonder how many times I’ve said “invoice right = get paid right” over the years?
I dread to think.
But invoice right = get paid right does not just mean having the patient’s details, coding, and fee right.
It means making sure an invoice is generated as soon as MHM is asked to do so and it means making sure it is delivered to the body responsible for paying it.
It is a discipline.
And it is a discipline that leads to MHM clients getting paid as quickly as they do.
pete@medicalhealthcaremanagement.co.uk
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Many times I’m asked how and why MHM clients achieve their practice aims with apparently so little effort.
Actually they don’t put in a little effort.
They put in a HUGE effort.
And the effort is against very specific objectives.
MHM does not allow its clients to define their private work as a practice: it is a BUSINESS.
Private consultants refer to it as a practice; I call it a business.
What seems like a mere play on words, is anything but. The whole of the business is geared towards making a sufficient financial return for the effort that is required.
Whilst this is absolutely NOT at the expense of providing 1st class 100% professional medical care for the patients, it does mean that patients aside, everything else is geared towards obtaining a financial return.
If the business does not generate a financial return, what is the point?
That’s why MHM negotiated a fee increase for two separate clients in respect of surgical episodes (both were increased by 40%) last week.
The consultants concerned did extra work and were therefore entitled to charge more. It is, after all, a business.
The question then arises of how they achieve their business aims with “so little effort”.
This may be summed up very simply: it’s NOT true.
But let’s be clear. I’m not talking about the consultant’s professional skills and abilities. I’m talking about the divorce between their professional skills and the amount of effort put in to run the business as a business.
All MHM clients are smart enough to outsource the management of their business; they themselves rarely get involved for they realise they are in a different world than they are used to.
Let me illustrate this by comparison with an NHS patient and a private patient.
All MHM clients have NHS commitments.
They see numerous patients all the time. But these patients are delivered without much effort on the part of the consultant. That is absolutely not the case with a private patient.
The consultant must go out and advertise himself by whatsoever means to attract patients to him.
Then he must make sure, unlike his NHS patient in respect of which he’ll be paid his NHS salary regardless, that the private patient or insurance company pay for the consultation, etc.
So what does “burn the boats” mean?
Burn the boats means that everything the private consultant does to support his business MUST be 100% organised and efficient.
A private medical practice – a BUSINESS – cannot be run in a half-hearted manner.
It takes – like any other business – considerable time and effort to get it right. Burn the boats means there is no way off the island.
Of course, a private consultant can choose to close his private practice/business and leave the island but the mindset when you start private work is that it has got to succeed for the boats have been burned.
pete@medicalhealthcaremanagement.co.uk
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