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From the October 2002 Issue Order in Chaos: Transforming Best-of-Breed Solutions Into Integrated Solutions |
Managing Managed Cardiovascular group practice finds that knowledge equals power, as well as control over its financial future. Medical care billing used to be a straightforward business: A provider sent claims to a payer, and the payer sent back payment at the invoice price. Pressured by government and employers to reduce healthcare spending, payers have developed intricate reimbursement formulas that require complex contracts with providers. These complexities leave most physician groups “flying blind” when it comes to managing and budgeting their operations. Until this year, Irving, TX-based COR Associates of North Texas (CSANT) was no exception. Even with a dedicated staff, a top practice management system (PMS) and high-quality coding and reimbursement tools, the cardiovascular physician practice group was affected by modern reimbursement challenges. Founded in 1983, CSANT has grown into one of Texas’ largest medical group practices, with more than 50 physicians in 15 offices and 35 hospitals in Northern Texas. Eventually, the impracticality of calculating complex reimbursements meant CSANT’s physicians and managers could only produce crude estimates of claims values. “We sensed we were losing thousands of dollars of profit to under-submissions and under-allowances, but we had no way of knowing exactly how much or where,” says Dick Powell, CEO of CSANT. “We could usually catch the big errors. It was more often the errors in the $20 to $100 range that went undetected. They add up. We understood the challenges facing us, and we knew what an appropriate solution would look like. We wanted to find an answer.” In 2001, CSANT found its answer in San Antonio, TX-based Medical Present Value Inc. (MPV) and Phynance™, an automated claims and allowable verification service. Facing the Challenge CSANT’s reimbursement challenges were some of the many that plague providers in the modern managed care environment:
“The majority of our claims are challenging to code accurately, because many have an average of five CPT codes on each,” says Jamie Marsh-Wheeler, CSANT’s payment processing manager. “Also, we do a lot of nuclear studies, which can be billed two ways, either by CPT or HCPCSs. Technologically, we needed a service with the ability to load both and simplify the complexity.” Phynance allows CSANT’s staff to identify contract-level coding errors on the front end and identify every incorrect explanation of benefits (EOB) allowable received on the back end. Administratively, the result is submission of cleaner claims and collection of better data to support appeals. Billing cycle times have fallen, reducing the costs of excessive days in accounts receivable. Within the first few months of implementing Phynance, CSANT was able to identify more than $100,000 in under-allowances. Moreover, from the November 2001 go-live to present, CSANT has identified more than $1.2 million in under-allowances that are currently in appeals. “Without the right tools, we were wasting our time trying to chase down money owed to us because we were looking in the wrong places,” says Powell. “We said to MPV, ‘Tell us what we are owed, and we’ll collect it.’ We want to collect all of the money owed to us. We just need a way to identify where to go after that money, and the information to back up our appeals.” Implementation In July 2001, MPV deployed a team of contract analysts to CSANT to unravel the complexities of the client’s payer contracts. Applying industry knowledge of both the physician and payer sides of the reimbursement equation, the analysts pored over CSANT’s individual contracts and defined more than 50 variables, such as fee schedules, multiple surgery reductions, modifiers and global policies for each contract. In most cases, payer agreements did not reveal certain contract variables used in valuing claims; to obtain the information, MPV analysts had to contact the health plan or payer directly as an agent of CSANT. With variables for all of contracts determined, the analysts created a custom, CSANT-specific database, which resides at the MPV data center in Austin. Bearing the entire data storage burden, MPV utilizes an application service provider model with CSANT, deploying the software and associated data across a secure Internet connection. Phynance’s architecture relies on Java™ and WebObjects, Oracle® databases and fully scalable Sun servers, each of which can process more than 140,000 claims per day. All data are transmitted with 128-bit encryption, and CSANT end users access the application using a Web browser. With the system in place, MPV’s client development team trained CSANT staff on the use of the application, including how to run a variety of tracking reports. The entire set-up and implementation period took less than 16 weeks. A System at Work Phynance “piggybacks” on top of CSANT’s Misys PMS and relies on claim data already flowing through the PMS. The interface is read-only and requires no duplicate data entry of claims. On a daily basis, Phynance evaluates claim data at two points in the revenue cycle. First, it automatically extracts claim information for primary transactions, copies selected data and transmits them over a secure Internet connection to MPV’s data center. These data are a subset of HCFA 1500 claim form data elements from the majority of CSANT’s fee-for-service claims and include the variables payers use to value their claims. The vendor’s automatic adjudication engine values and verifies the accuracy of the medical claims and allowables based on payer contract and government rules at the line-item level. The system identifies contract-level errors before filing, allowing CSANT administrators to repair claims prior to submission and thus reduce payment cycles with cleaner claims. Second, after payments are posted to the PMS, Phynance copies relevant EOB data to its adjudication engine and compares allowed amounts to expected allowed amounts, per payer contract and government policies. It flags contract-level errors in the allowed amount as well as their code-level sources, providing CSANT billing staff with concise explanations for informed and successful appeals, or refunds to payers. Because the Oracle relational database allows for almost infinite variables, queries ranging from very simple to extremely complex can be run to produce a variety of reports. CSANT end users can run standard, semi-custom and custom reports to manage the practice group’s reimbursements and contracts, and to respond to any potential audits. These reports have provided CSANT with the “proof in print” the practice needed to identify where it was losing money and to back up its appeals to retrieve that money. Because MPV constantly monitors the changing U.S. healthcare reimbursement process, including Medicare and Medicaid bulletins, changes are reflected immediately, in real time, in the logic Phynance uses to value claims and verify allowables. This up-to-date accuracy helps ensure Medicare compliance for over-allowances, and custom reports run by CSANT’s staff can serve as detailed support for compliance. Reports on error rates at the contract level have given CSANT insight into which agreements are the most and the least beneficial to the practice. With performance data in hand, CSANT can leverage its new knowledge to negotiate more favorable contracts with payers. “We are no longer flying blind,” says Powell. “We are negotiating with insurance companies from a position of strength. As a result, we have control over our financial future.” SOURCE Dick Powell
Phynance™ For more information about Phynance from MPV, www.rsleads.com/210ht-193 © 2002 Nelson Publishing, Inc |
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