Anybody ever watched the movie “Jerry Maguire” and the immortal quote – show me the money!
Clearly a guy I recently bumped into at a medical conference hadn’t. He was the Practice Manager for a large hospital group.
His complaint was the lack of cash from insurance companies coming into the business.
His solution had been to analysis the internal administrative process of the hospital; make sure everybody knew their role and when to do it.
He ended up with a very comprehensive PowerPoint presentation.
Indeed he had spent four months doing just that.
After four months nothing had changed really.
I couldn’t help but think about his thought process.
He had gone around writing reports and compiling analysis rather than actually speaking to the insurance companies and finding out what the problem was from THEIR end?
In other words WHY they were not paying him?
If he had done so he would have immediately realised his practice was not invoicing correctly.
If he had asked the insurance companies they would have told him just that.
Only then could the practice start to review and possibly change the process to make sure they did get paid.
Start with the basics. Or as Jerry Maguire would say:
pete@medicalhealthcaremanagement.co.uk
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If you get the basics right many problems with getting paid don’t happen.
The basics mean the absolute minimum and mandatory requirements in order to present an account for your services. The basics are:
Patient’s full name.
What is their full address?
Do you have the postcode.
Patient’s date of birth
The name of their insurance company
The policy number of their insurance company
A pre-authorisation number issued by the insurance company
A Correct CCSD code
Make sure you have the right fee for that Code
But it doesn’t stop there.
Your name and address
The Consultant’s provider number
A unique invoice number
The date of the invoice
The date of the treatment/consultation
The right CCSD code
A value!
14 points.
But if you don’t get all 14 you make it harder for the insurance company to pay you.
Where do you get the above data from?
If you are practicing from a private hospital all this data will be recorded on the patient’s registration form.
If you are operating from some other private consultation facility, make sure you do ensure the details are obtained.
If you are invoicing electronically, its pretty much standard that you MUST have the above data. The same is also true if you are dealing with a self-funding patient or you have to collect a shortfall/excess amount from a patient.
In other words, you are going to need all 14 pieces of data.
Therefore it makes more sense to get them right the first time.
But have a guess at what are the TWO major reasons an insurance company does NOT pay your invoice?
pete@medicalhealthcaremanagement.co.uk
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This is the one question I get asked more often than all the others.
The first thing to realise about increasing a fee is that you CANNOT increase a fee for all your surgical episodes. Nor can you increase a fee every time you perform a surgical episode.
Having said that it is possible on occasion to request an uplift in fee under certain circumstances. The question of time taken, however, to perform the actual episode is not in itself the first reason to request an increase in fee.
All insurance companies WILL consider a request to increase fee but the time duration of the episode is not the place to start.
It is the “what, when & how to ask” that is the most important item to consider.
What, for example, may be defined as a 50% increase in the stated fee.
Do NOT merely ask for a 100% increase in fee because the probability is that you will not get it!
When? The “when” may be defined as asking for an increase to be considered before an invoice is submitted.
How? This may be defined as having the correct information in order for the increase to be considered.
When MHM is asked to request a 50% increase in fee MHM asks its client to supply the following information:
a. The precise details of why medically the consultant feels his fee should be increased. In other words, a written explanation from the consultant as to why the episode was more complicated than anticipated. The consultant is also asked to provide a copy of his/her theatre notes.
b. Details from the anesthetist who provided his/her services during the episode
c. Copies of correspondence from the Hospital detailing the original schedule i.e. time allocated etc.
MHM will then call the insurance company concerned and advise them a fee increase is being requested.
It will tell the insurance company a fee increase from say £500 to £750 is being requested. It will advise the insurance company all the information is available and ask to where the supporting documentation is to be supplied.
Only then will an invoice be raised and submitted. It is then a question of checking the invoice every single week to ascertain the status of the invoice.
By following the above process MHM has on numerous occasions obtained an increase in the fee for its clients.
Without following the process, you probably won’t get an increase in your fee.
pete@medicalhealthcaremanagement.co.uk
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A Consultant Surgeon performs code AB1234 worth £525.
At the same time, he performs a DC2468 worth £576.
The patient is insured so an invoice has to be submitted for payment.
Therefore you have to calculate the fee payable by the insurance company.
Easy.
The total is £1,101.
However…
You can’t charge a total of £1,101 i.e. both.
You can only charge 100% of the first code’s fee (£525) and 50% of second code’s fee (£576) i.e. £525 plus £288.
Total is £813.00
The problem though is that fee calculation is also wrong.
Why?
You should charge as follows – 100% of the higher fee and 50% of the lower fee. In the above example, it’s been calculated the wrong way round.
The correct calculation is:
£576.00 for the DC2468
£262.50 or 50% of the AB1234 fee
£576 plus £262.50 =
£838.50.
The potential gain for the consultant is, therefore, £25.50.
Or look at it another way, if you charge it the wrong way round, the consultant will undercharge and loose £25.50
It becomes a bigger issue as most surgeons perform the same procedures many times a month.
The same error repeated 10 times costs £255 each month.
How easy is it to make such an error?
Very, very easy.
If the consultant surgeon supplies a theatre list most likely he’ll have the codes written down.
But it’s a danger to assume they are written down in the order they should be invoiced.
You must check them and make sure you are billing codes in the right order if you are to ensure the consultant gets paid the right fee for his work.
pete@medicalhealthcaremanagement.co.uk
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After a recent presentation, a private consultant surgeon telephoned me. He wanted all his fees checked.
He heard about the MHM fee checker from a colleague who had attended the presentation so he wanted to commission a full review of his fees.
But he wasn’t so much a colleague of an MHM client. More he was married to one!
The standard charge for doing this is £100; sometimes it takes a few hours, sometimes it takes a whole day.
But as the husband of a current client, he got a freebie
To do it accurately however, you literally have to shut the door and have a “do not disturb” sign also.
You first need to know precisely where to look!
Especially with this surgeon as I calculated he had 204 separate fees to check.
It is very much a case of paying attention to the detail relating to each fee. This one took me about 6 hours and was emailed to the consultant on the same day.
During those 6 hours I identified 2 fees which were wrong.
Big deal.
Save the fees published by the two insurance companies concerned were actually HIGHER than the consultant had been charging.
He had undercharged for his services.
In one case he had undercharged by £150 (21%)
In the second case, he had undercharged by £21 (16%)
So he immediately amended his fees and started to charge the correct amount.
He called me this morning; the last working day of the month.
So far and by using the correct fees he had charged and been paid an additional £513.
Of course, fees can go down as well. Sometimes the consultant’s fees are absolutely correct too.
But if they go UP you are literally undercharging for your services. What made it worse for the consultant concerned is that the fees had gone up at the end of September so he estimates he has missed out on around £1,800.
Look at it this way and work the maths out. He has earned an additional £513 this month. Less the £100 it should have cost him (my fee) he is still £413 better off.
I should have charged him after all. Nah!
pete@medicalhealthcaremanagement.co.uk
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I don’t like is the expression “cash flow”
For the simple reason, cash does not flow.
Cash has to be managed.
Around this time of year, I take calls from consultant surgeons who want an increase in cash collections.
It’s happened every year since MHM was formed. The normal instruction is to increase the cash flow. Immediately. Simple enough. I can do that.
Existing clients don’t call because invoices have already been generated for them and they’ve already been paid for their work. Their cash has already been maximized.
The real problem faced by potential clients though was highlighted this morning when a consultant surgeon referred to needing an outstanding cash flow “purge” within his practice.
This highlights to me a more fundamental underlying issue. Let me explain.
A consultant surgeon – just the same as any business – should know how much he is invoicing both in terms of patient numbers and the value of those patients.
If he is invoicing correctly and ensuring he gets paid he can also, therefore, calculate his revenue receipts.
Should he another service or product, he should be able to perform the same calculation.
So he knows how much he is or should be invoicing. Providing he proactively manages his practice.
If you think about it, most consultant surgeons already know their overheads too. They know how much their room rental is. They know how much the staff cost.
And they know how much their professional indemnity costs (too much before you ask).
Of course, there are other expenses but fundamentally they already know their expenditure.
They know their total costs.
Therefore they know how much they are spending too.
Enter stage left Mr. Micawber:
He knew a thing or two about how to run a private medical practice did Charles Dickens.
For one thing, he knew cash doesn’t just flow into it.
It has to be managed.
Just don’t say cash flow to me.
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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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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 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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Recently I spoke about the clarity of data. You need to be able to read it.
Consequently, I took a phone call last afternoon from an MHM client. He reminded me how I once gently pointed out texting me was not a good idea.
We laugh about it now but back in 2018 when we started working together it was painful.
For example: if there was a problem with the clinic list I’d phone him and leave a message for him to call back.
Generally speaking this lead to a text message asking what the problem was.
So I’d text back.
This lead on to a mammoth text change that could easily take an hour. An hour of interruptions and an inability to sort a single problem out because it wasn’t clear what the issue was.
Nor was it clear what the suggested solution was.
This would happen most days to our mutual annoyance.
To be honest, I could not afford to spend so much wasted time that way. And neither could the client.
So we stopped.
Now if there is a problem, I text and ask him to call. He texts back giving me a time and I call him at that time.
Consequently on a bad week we speak once. On a terrible week, we speak twice. But we seldom have those sorts of weeks anymore.
Indeed today was the first time I’ve spoken to him since early July.
And that is why it is vital to get the right data, in the right format and prevent the very opportunity for issues to arise.
pete@medicalhealthcaremanagement.co.uk
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I called one of my friends early one evening last week. His phone went straight to voice mail. Curiously he didn’t call me back with half an hour or so per normal. He called me this morning instead. He explained why. Every Wednesday, he and his wife have a “date night” They switch their respective phones off.
No emails, text or phones interrupting them. They spend time talking to each other.
And that got me thinking.
A couple of years ago I started doing something similar. At the end of each day, I’d put my phone on silent and switched my emails off too. Why?
Because each day I need time to review any opportunities/problems I’ve got to deal with the next day. It also means I can think about an issue at length, leave it overnight ready to be re-thought about on the next day. That stops me making knee jerk reactions and allows time to have a fully considered opinion ready. Rarely will you get an immediate reaction from me. My response to an issue has, therefore, been thought through.
Yet many medical practice managers or indeed consultant surgeons running a practice, don’t stop and think through an issue. They are too busy. But alternatively, they are too busy because they don’t stop and think through the issue.
Sadly I see this all too often when I go meet a potential new client. Many of the issues they are facing have their source in a previous decision. The previous decision itself could well be based on a decision before that one even. One of those decisions in the chain was almost certainly not thought through.
For example: recently I blogged about a group of gynecologists in the West Midlands who, in an effort to stop issues with self-funding patients decided ALL self-funding patients must pay in advance.
Immediately the problem with self-funding patients stopped. Because there weren’t any self-funding patients anymore.
This was a solution to the problem. It worked. Sadly, however, it had some unpleasant side effects i.e. no patients.
Clearly, they hadn’t thought through the consequences of their decision. They had reacted. Yet the reaction caused another problem i.e. no more self-funding patients. That was unfortunate as 23% of their practice was derived from self-funding patients.
The above example is indicative of the cause of many of the issues within that particular practice. It was relatively easy to put the self-funding issue right because I’ve faced that specific challenge a few hundred times previously (email me for how). Getting the practice manager and the three consultants to change their mindset though was much more difficult.
They did change though because they had seen a 100% reduction in self-funder outstanding invoices. Sadly this was at the expense of a 100% reduction in self-funder patients.
They changed not just because I knew the answer. They changed because they realised when I faced that issue previously, I’d allowed myself sufficient time to give it serious thought and consideration before reaching a decision. I implemented a course of action that didn’t put patients off by asking payment in advance but did reduce the number of outstanding self-funder invoices. As a bonus, it stopped the problem with self-funding patients who were DNA too!
And that is why it is important to put the time aside and think through an issue before deciding on a specific course of action.
pete@medicalhealthcaremanagement.co.uk
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At a recent on-line presentation, I was asked about the costs and use of accounting software. Bearing in mind the presentation was to consultants who had not yet established a private practice, numerous eyebrows were raised when I answered…
You may not need it yet.
This does not mean accounting software is unnecessary. Some private practices do need a software package and there are some fine software packages out there. They are cost efficient too. MHM works, very successfully, with many of them too.
But for those seeing say 10 or 12 patients a week use MS Excel or Apple Numbers and an online diary. MHM has clients for whom it raises invoices on Excel and uses the same to run a sales/debtors ledger.
The sales ledger – once password protected – can be sent either to the client and/or the client’s accountant.
If a private practice is a business – and it is – then you MUST keep an eye on all costs.
It’s always useful to ask yourself the question: am I paying for something I don’t actually need?
pete@medicalhealthcaremanagement.co.uk
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Ever thought what is the most often quoted reason for non-payment by a self funding patient?
The same reason is quoted over and over again.
It is not ‘I haven’t got the money” nor is it “I didn’t realise it was so much”, not even “The invoice must have got lost in the post”.
Actually, it is…
“But when I registered at the Private Hospital, they took a swipe of my debit (or credit] card and the fees should have been taken from that”
Why is this always being quoted?
Why should you be suspicious?
In answer to the first question, it’s because the patient assumes the bill will be “sorted” by the hospital.
They don’t realise that the transaction is between them and you.
In answer to the second part, you should not be suspicious.
This is not to suggest the fault lies with the reception staff at the private hospital.
Recently I went with my own partner to a private hospital and as she checked in, it was very clearly explained that her debit card swipe covered only the hospital fees.
There was even a sign up to that effect on the wall in front of us. So my partner, as all private patients, should realise what is covered by the swipe of their debit card.
Yet a few weeks’ later when the invoice arrived from the consultant, she said something was wrong The Hospital had taken a swipe of her card when she attended the consultation.
Quite rightly, she called the consultant’s secretary who explained the situation and payment was made the same day.
It does demonstrate, however, the most often quoted reason why payment for a self funding invoice has not been made.
pete@medicalhealthcaremanagement.co.uk
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In response to this morning’s blog about “gap” invoices being increasingly used to mitigate fee reduction(s) imposed on consultant surgeons, many emailed me and disagreed.
It is of no surprise the vast majority who disagreed work for insurance companies.
Some were quite vocal in the dislike of “gap” invoices.
They were of the opinion cost extraction was the ONLY way to reduce the cost of premiums.
That alone would make private health insurance more attractive.
Faced with a smaller number of potential or existing policyholders, insurance companies have sought to make the offering more attractive by making it cheaper.
But is cost extraction really the only way to make private medical insurance more attractive?
The implication of such a view, confirms the belief that price is the single factor when a patient takes out insurance.
GAP invoices, being diametrically opposed to that aim, should be resisted.
However, are patients really that fixated by cost?
Or are there other factors they consider?
Some patients are happy to pay Gap invoices. That suggests the cost is not the only factor.
Some are completely unaware of the fee reductions being imposed on their consultant.
So are they really that concerned with the cost?
To a certain extent of course they are.
All patients looking for a package with a private hospital, for example, will be price conscious.
However, that may not be the overriding factor.
Whilst they will certainly be looking for a value for money, it is more likely the perceived value of the package is more of a driver than just the cost.
Deeply involved in the perceived value is the reason the patient wants to be seen privately in the first place.
The prime reason a patient takes out private insurance is that they wish to be seen as quickly as possible, as conveniently as possible and by the consultant they want.
Yet insurance companies seem almost fixated with taking cost out of the private insurance market.
Seldom do they seem to be interested in what else the patient is seeking?
Seldom do they emphasize that a patient with medical insurance can be seen quicker and more conveniently.
Private health care is deemed to be expensive.
Whether it is or not is actually secondary.
What is more relevant is the perception it is.
So the insurance companies react by trying to take cost out. They begin a race to the lowest fee or to the bottom if you will. In doing so they sometimes shifting the emphasis away what the patient really wants.
To be seen not only at a reasonable cost but as quickly and conveniently as possible.
Keep reducing fees and sooner or later the fees will be so low the private consultant can no longer make a reasonable return.
Add in the fact there are fewer people who have private medical insurance now than at any time since the early 90s – and consistently reducing costs in search of a smaller pool of potential patients creates almost a perfect storm.
All of my clients have substantial NHS obligations which, incidentally, they perform to exactly the same skill level as their private work.
They are hard-wired to perform both in the best possible way.
So why does an NHS patient ask an MHM client if the consultant can see them privately?
By no means does that suggest a patient will pay any price to see their consultant of choice.
They want to see their consultant of choice and the most convenient time to themselves.
They do not, for whatsoever reason, want to wait
So why is it that insurance companies concentrate so much on taking cost out of the private healthcare offering, whilst almost failing to point out that private medical insurance offers rapid convenient access to a high level of facilities and a choice of whom the patient may see.
Doesn’t the existence and acceptance of GAP invoices, actually suggest that patients are prepared to pay more and not less to see a consultant as soon as they possibly can and where they wish?
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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Getting paid the most he or she can at the earliest possible date is the aim.
Such a simple aim but it is one that many sometimes forget.
How do you achieve that aim?
The first step is to make sure you are provided with all the necessary details to put on the invoice. Regardless of whether you invoice electronically or in paper form you will need this information. Without it you will struggle to raise an invoice. And thus the aim is harder to achieve. Let me provide you with three real examples I’ve had to resolve this morning:
The patient was (not his real name) Mr P. J Smith. If the invoice is being raised electronically you’ll need to know what the P stands for (was actually Paul). But – and this is the important point – I had to go away and look at the patient’s registration form which itself just had the initial. It was only when I looked down at the name of the policy holder that I saw the name Paul. It sounds really silly but a single omission like that needs to be resolved. Thus the aim is not met quickly and efficiently.
It was not on the registration form anywhere. Again if you are going to invoice electronically, you’ll need the patient’s postcode. Solution: go to the Post Office postcode finder on the internet and look it up. Simple solution but one that had to be done in order for an invoice to be raised. Again, although it only took a few minutes to resolve it was a task that should not have been necessary.
This one was more difficult. The solution involved telephoning the consultant surgeon’s secretary to ask what the date of birth was. She actually didn’t know and had to call the patient to find out.
Of course there are solutions to each of the above. For example: many of the on-line offerings will enable you to find the missing data. There is no major issue in sorting things like this out. They are more irritants. They have to be resolved but that really isn’t the point.
The point is that all three of the above should not have been allowed to happen.
If the aim of invoicing for a private consultant surgeon or any medical professional for that matter is to ensure they get paid, it must be done quickly and efficiently.
Cause and Effect
What was causing this issue? It is far too easy to blame someone. Blame the consultant surgeon’s secretary. Or blame the hospital for not ensuring the patient’s registration form was not completed correctly. It may be either. Interestingly, on many occasions when I’ve pointed out to a med sec the necessity of getting all the right details they have replied that they didn’t realise how crucial the information was. Nobody had told them! The problem thus goes away.
Let me illustrate by reference to a real MHM client. He held an outpatient clinic Monday evening and saw 9 patients. The clinic list was delivered to me electronically on Monday evening. By 10am Tuesday morning, all 9 patients had been invoiced.
But only because both he and his med-sec understand the importance of making sure all the patient’s details are correct and complete.
And thus he will get paid quickly.
Aim achieved!
pete@medicalhealthcaremanagement.co.uk
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Every so often I take a phone call from a self funding patient. The patient requires a receipt for their payment. The patient can then re-claim the amount paid from their health cash plan provider.
For example: a patient visits a private surgeon and pays for their treatment. MHM issue a receipt on behalf of the surgeon. The patient can then claim the fee back from their Health Cash plan provider.
The Cash Plan Provider insists on a receipt as proof of payment before reimbursing the patient.
Alternatively the patient is insured but outpatient appointments are not covered under their policy. The patient has to pay before claiming the funds back from another source.
So what are Health Cash Plans?
Health Cash Plans are designed to ease the financial burden of having such regular health checks.
They are NOT the same as a private medical insurance policy.
Well on some occasions it has indeed transpired that the patient’s private medical insurance cover does NOT include outpatient appointments. Other items may be excluded too. Instead the patient has a health cash plan to cover the cost of their treatment.
But unlike full blown insurance cover, the patient is required to pay the charges they have incurred. They then re-claim the payment from the Health Cash Plan provider.
And that’s why they require a receipt.
Thus it is important to understand what a Health Cash Plan is and how it may compliment a private medical insurance policy.
pete@medicalhealthcaremanagement.co.uk
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A group of surgeons I know are having problems getting paid by insurance companies.
Not just an individual insurance company but all insurance companies. More specifically or so the surgeon’s practice manager claimed, there were many invoices unpaid by insurance companies 3 months after the consultation or episode date. This was all the fault of the insurance companies who simply do not want to pay.
I found this odd as in my experience ALL the insurance companies I deal with pay well before 3 months has elapsed.
The practice manager therefore altered the patients terms and conditions to read “patients will be asked to pay anything not settled after three months”. This is, in his words “a long stop” and would prevent the issue arising. I’m not convinced however putting such a plaster over the wound is the correct action to take.plaster
I’m definately not convinced a “long stop” will prevent the problem because it will allow the invoices to become three months old and then do something about them.
I raised the following two points with the consultants and their Practice Manager:
the patient is ultimately liable for payment anyway. The contract is between the consultant and the patient. Not the consultant and the patient’s insurance company. Whilst it is useful to insert the “three months” clause it would have been better to add it was ultimately the patient’s liability anyway as well.
Is the “three month’s clause” not missing the point entirely? WHY aren’t the invoices being paid within three months?
It’s this second point that is the more relevant of the two.
Insurance companies are NOT the enemy. Of course, I disagree with many of their fee reductions. I also disagree when they decree certain multi procedures are now deemed to be part and parcel of each other. The reason for my disagreement is obvious. I’m here to get the maximum amount of revenue for my clients. Anything that reduces such revenue is not good.
Nonetheless, insurance companies should not be treated as if they are the enemy. Insurance companies WILL settle a claim within 3 months. I can honestly say I don’t have a single invoice for one of my clients sent to an insurance company still unpaid after three months.
So why are the group of surgeons referred to earlier having problems and introducing the “three month” rule?
Without even drilling too far down into how and when the surgeons were invoicing, I can tell you the probable cause and why they subsequently feel the rule is necessary. TWO REASONS:
Invoices are not being raised immediately or at worse within seven days of the episode date
Invoices raised are incomplete and not accurate.
That is why the invoices are not being paid earlier than the consultants are currently experiencing.
It is all about getting it right first time. First time means having a clinic list or a theatre list invoiced promptly with all the details required by the insurance company appearing correctly on the invoice.
Putting the effort in up front always generates the best results. It may be tiresome and it may be an inconvenience to have to stop, make a phone call so you DO have the correct details but it pays in the long run.
Its also all about 30 days after the invoice has been transmitted to an insurance company if it is still unpaid, getting them on the phone and asking if there is a problem. If there is, it gets sorted immediately. In other words, the invoice is not allowed to be dated more than three months from the episode or consultation date.
Consider it this way. If you invoice quickly and invoice correctly, the number of potential issues which may delay payment reduce considerably.
You simply must make it easy for a private medical insurance company to deal with your invoices. I actually said that to a consultant surgeon recently who wasn’t sure he agreed until I asked him if he liked money or not? Obviously he said he did. Therefore, my statement was correct.
As regards the consultants who have now introduced the “three month rule” the rule itself should be entirely unnecessary. The cause of the problem should be examined and steps taken to prevent the invoices becoming more than three months old.
pete@medicalhealthcaremanagement.co.uk
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Top up (or GAP) invoices – asking the patient to agree to pay the difference between a consultant’s fee and the fee an insurance company is prepared to pay.
The discussion concerning them seems to take place more in whispers than anything else.
And sometimes they are even deemed to be almost a taboo subject because they don’t exist.
But they do.
So, and for the record:
I have no problem issuing them on behalf of my clients. Why and when?
Consider the case of a real consultant surgeon whose patient is quite happy to pay, for example, £852 for a surgical episode.
But the patient is insured with XYZ Insurance.
XYZ will only pay a “customary and reasonable fee” of £639. The fee was £852 but due to “market conditions” XYZ has reduced it by 25%.
Thus the consultant may now as part of his recognition protocol only charge £639
Most consultants actually perform the same procedure throughout the month.
Empirical evidence using MHM clients confirms they all perform, in their own specialism obviously, the same code(s) on average 5 times a month.
If that code happens to be the one reduced by £213 each time, the reduction in revenue is over £1,000 each month.
In the original scenario though, the patient has chosen to see that particular consultant.
His/her decision has zero to do with fees.
That is the consultant the patient has chosen.
If the patient is advised the fee for their procedure is £852 but their insurance company will only pay £639 towards it and then if they – the patient – is asked beforehand to pay the difference and agrees, where is the problem?
Ah no, say the insurance company, you can’t do that for that is above our customary and reasonable fees and anyway, you are risking your recognition with us.
This article is not about if they are right to potentially withdraw recognition if fees are not adhered to.
Neither is it about whether XYZ Insurance is right to reduce the fee.
The first thing consultants will all do is be deeply unhappy about the reduction.
The second thing they will do is attempt to mitigate the loss somehow or another.
And the second point is the more relevant one.
Many times I hear from insurance companies the market is contracting and cost has to be taken out to make the private medical insurance offering more attractive.
No argument from me on that BUT why is the cost reduction, or so it appears, being continually directed at the consultants?
Yes, I am aware that certain fees have gone up but overall fees have come down.
I’m equally opposed to those consultants who insist on ignoring insurance companies fee structures for every single procedure and/or episode.
I’m also very focused on taking cost out of any business so I can see where the insurance companies are coming from.
But not at the expense of continually reducing a consultant’s fee and thereby reducing his profit continually AND the patient’s right to a choice.
Top Up or Gap invoices are a reaction to consultants continually seeing their fees being eroded.
I haven’t said I completely agree with them for they should be unnecessary.
What I am saying is that I understand why I’m being asked to produce them and when.
Consider an actual quote to me recently from a very well established consultant surgeon.
An orthopod who has been in private practice for over 10 years:
That, perhaps, sums up precisely why some MHM clients are asking me to produce Top Up or GAP invoices.
pete@medicalhealthcaremanagement.co.uk
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Per normal I was checking what was happening with shortfalls and excess over the weekend. Using a single private consultant surgeon as an example:
Week ending Friday January 22nd: out of 15 consultations 4 came back with excess / shortfall deductions totalling £575. So for a total of £2,500 worth of outpatient consultations £575 or 23% came back short. Looking back to the same week last year, the number of shortfalls / excess were considerably less.
The question as to why this is happening is not the concern. The concern is what are we going to do about it for if 23% continues the downside and potential loss to the consultant is significant. What to do about it? The very first thing to do is to make sure the patient has been invoiced for the amount due immediately. If payment is not received within a week then there is only one subsequent single course of action.
Phone the patient. I do. Once I have the patient on the phone I take payment via a debit or credit card.
Sure you can write letters and even email but nothing gets a response like a ringing telephone. Most patients are unaware of the issue (yes I know when they open their policy they are made aware of excess values) but some think this is an issue between them and their insurance company. In other words, the patient thinks they need to pay the insurance company because the consultant gets paid in full by the insurance company. There are variations on this but the crucial point for the consultant is not to establish why; its to ensure he recovers the shortfall / excess efficiently.That means speaking to the patient.
But if telephoning the patient is the most efficient way to tackle the issue, it does not automatically follow its the easiest. It has to be done professionally and with due diligence. The long suffering med-sec really won’t have the time to do this as professional and caring as she undoubtedly is. The majority of medical secretaries won’t want to phone patients for money and will be thinking this is the least enjoyable part of her job.
What if the consultant doesn’t employ someone to tackle this? What if they don’t do anything?
Assume it’s not £575 or 23% a week or £27,600 a year (£575 multiplied by 48 – not 52 weeks as you will have 4 weeks off a year). Assume instead its 10% for 24 weeks (i.e. roughly half) and allows for some patients paying without being contacted.
Thats still £13,800 per annum.
What’s significant is that when speaking to a group of private consultant surgeons I asked what they considered the biggest threat to their practice(s). Most popular is the anticipated further reduction in fees paid by private medical insurance companies. There is little if anything that can be done about that.
The second concern, however, is the number of shortfalls and excess. It’s becoming a big challenge and so it should be.
At this point, empirical evidence suggests its potentially leaving the back door wide open and enduring £13,800 worth of potential losses right off the bottom line.
I’d be really interested to hear from anyone who is seeing an increase in shortfalls etc and their views on remedies.
pete@medicalhealthcaremanagement.co.uk
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