The first step to getting paid is to bill correctly. This process doesn't just begin when filling out the claims information, however. It begins from the moment a patient steps into the clinic and a new file is created. As the patient goes through the treatment process, it is up to the front office staff, the PTs, and the billing department to ensure the accuracy of the claims. Smart and efficient business practices, as well as comprehensive electronic practice-management systems, can help streamline billing processes, decrease denials, and ultimately, increase payments.

SOFTWARE SOLUTIONS

Perhaps one of the biggest advantages to having a computer-based practice-management system—which would provide everything from business and billing functions to medical records and clinical diagnosis aids—is that PTs gain a virtual ally when conquering backed-up claims. Because the average number of patient visits per week can reach into the hundreds, and the time needed for any staff member to navigate through the paperwork is nonexistent, it is highly likely that claims processing will pile up.

With an electronic practice-management system, patient information can be quickly entered and easily accessed when claims are processed. Those claims also may be paid earlier, since the data is more accurate and more legible than handwritten records. Some software programs are even set up to incorporate existing CMS codes and will typically prompt therapists to use the correct ones, encouraging a higher number of payments and fewer denials.

Modern practice-management software decreases the number of denied claims by also improving billing functions. Most billing applications will identify problems with claims that should be rectified prior to their submission, which will improve the chances that the claims will be processed by the payor after the first submission. This will help reduce the time spent researching denials and resubmitting claims, and it may positively affect cash flow.

Advanced claims-management functions significantly reduce the number of denied claims by also streamlining a physical therapy practice's payment process. For example, some software contains functionality that edits claims and determines the appropriate code for each payor based on cumulative data collected over time.

Although no health care practitioner wants to think of each patient as a "business," the best ammunition against denied claims is knowledge. If one is to be in a debate about revenue, it is best for one to arm oneself with thorough and accurate information about each patient claim. Point-of-service data collection via integrated systems allows the acquisition of outcomes data, patient-satisfaction information, and indicators of compliance with mandatory clinical evaluation and management criteria.

Managing a practice's billing process successfully means understanding how to best maximize reimbursement by performing specific procedures in the office. It means knowing reimbursement codes and regulations. It might also entail adopting computerized diagnosis, pain-assessment, and musculoskeletal-examination technologies. Also, it requires a fundamental knowledge of business principles, including business planning.

BUSINESS PROCESS TIPS

Most errors begin in the billing system. The billing staff is not completely trained on all of its functions, and/or the system in place is in need of an upgrade. It is imperative that you have a well-trained staff who understands current procedural terminology (CPT) and ICD-9 coding, insurance contracts, rules and regulations, and the entire billing system; and then enters accurate data. Additionally, you must have all authorizations and/or referrals in place, and you must bill according to federal and state rules and regulations. Assuming that all of that is in place, and your patient data is correct, you should expect to receive payment for your services. However, that is not always the case.

Actually, you may be doing everything right—but that does not always mean that you will get paid. Communication among the front-desk staff, therapist, biller, and collector is paramount to the success of getting paid for services rendered. The knowledge shared is important to not miss why some claims may have been billed a particular way or why others are being held up. In small practices, one employee may perform both biller and collector duties. Sharing problems regarding the computer system, data entry, delayed billing, electronic billing, and printing paper claims are just some of the reasons that can result in delayed payments or no payments.

A skilled collector knows that, in many cases, to receive payment, a call—or two or three—must be made. That connection is necessary to ensure that the claims not paid within 30 to 60 days are followed up to solve the problem and ensure that current and future claims will be paid. Follow-up is the key to ensuring that all unpaid claims billed out are paid.

In many clinics, the follow-up on unpaid claims is poor and sometimes is almost nonexistent. The person on staff who has been assigned to collect on past due accounts is not as efficient as he or she could be. All information needed to follow up on unpaid claims should be in your system. Notes should always be up to date, and they should include what the patient's insurance benefit is, what the authorization/referral number is, and what dates it covers; and any and all correspondence that has transpired on the claim. Discharged files should be nearby, so if information such as a physician referral is requested, it can be easily found and faxed. Active files should not be too far away, either, for the same reasons.

Some paid claims also may end up being challenged because the payor believes the claims were paid in error. In a case like this, an investigation as to who is responsible for the claims must begin. This now involves making several phone calls to ensure that if a reimbursement needs to be made, the payment from the other source will soon follow.

MANAGING PATIENT BALANCES

It seems that many patients put medical bills last on their list of what to pay. Collecting copays, some portion of coinsurance, and deductibles at the time of service helps reduce the amount of patient-owed balances. Collection of patient balances is one of the key functions of the front-desk staff, and there should be no excuses for not collecting them. Once again, a good billing system should be able to produce a daily report of patients who owe copays and other coinsurance balances. Also, having a strict "payment at time of service" policy and giving payment alternatives—such as cash, check, or credit card—to patients lead to a more successful collection rate.

It also is important to set up a system to collect patient accounts on which the collector has exhausted all efforts. This could be an attorney who will send out one or two letters and make a phone call to patients with outstanding balances, or a collection agency who will take similar action. Typically, most attorneys' offices or collection agencies take one-third of what is collected. You should not have to pay any additional fees to use an outside agency unless the case is going on for further litigation. In the end, patient balances up to $300 that are not collected by your outside source are usually written off as a bad debt, because it can cost you more to take the patient to court—and that is not always a guarantee of payment.

UNDERSTAND DENIALS

Another very important factor in facilitating prompt payment of claims is to answer daily requests for information and daily denials immediately. If you are receiving more denials in a day than you can handle in a day, you have a serious problem that must be rectified immediately in order to stop denials for repetitive reasons.

What is a denial? A denial is a written response from an insurance company with regard to a claim you submitted stating that the claim is not valid and will not be paid. A claim could be denied for several reasons, such as the patient's insurance does not cover physical therapy, the patient's insurance is not valid at the time of service, the claim was submitted over the filing limit, no authorization or referral is in place at the time of service, or you are not a provider. Although some denials are flat-out wrong, a phone call will still be required to straighten out the problem, to turn the denial around, and get paid; or to ask the patient for assistance.

Do not be confused about the difference between a denial and a request for more information. Many times, you receive a request for more information, such as a copy of the physician's prescription, a copy of an explanation of benefits from the primary insurance, or copies of notes. These are not denials—no one is saying you will not be paid. What they are are notes from the insurance company stating that payments cannot be processed without the requested information. Many times, the information can be faxed or e-mailed. If you answer the request immediately, chances are very good that you will receive a check within a week. However, a follow-up call is a good idea to ensure that the insurance company received the information and that a check is being processed.

EXAMINING REPORTS

All business owners should become familiar with and learn how to read their accounts-receivable report. By reading this report and other financial reports from your system, and by checking the daily mail for denials, you will uncover where you may be having trouble with payments. The goal here is to determine those accounts that are aging but are still collectible, and those that are not. If you determine that some accounts are not collectible, you must record the reason why to ensure that revenue is not lost for that reason again.

By reviewing your accounts-receivable report each week, you will be able to see accounts that continue to age. Then, you can ask questions regarding their status and how and when they will be paid. You also can learn how to go into the system and randomly check patient notes to see that accounts are consistently being checked. Your collector should have clear, understandable answers to all of your questions.

Michelle Park is a contributing writer for Physical Therapy Products. For more information, contact .