The state of Minnesota is turning a corner that no other state has dared face in the same way.

A 2007 law takes effect today, requiring “electronic billing of all health care claims.”

The effort to eliminate paperwork, standardize billing terms and reduce errors will save [...]]]> By Jeff Hansel

The state of Minnesota is turning a corner that no other state has dared face in the same way.

A 2007 law takes effect today, requiring “electronic billing of all health care claims.”

The effort to eliminate paperwork, standardize billing terms and reduce errors will save an estimated $60 million per year, said David Haugen, director for the Minnesota Department of Health’s Center for Health Care Purchasing Improvement.

“We think the savings potential has been estimated pretty conservatively,” Haugen said Monday.

Mountains of paperwork pass through the nation’s health care system daily and, often, no two forms include the same definitions for the words written upon them.

Now, Minnesota has defined a standard set of terms that all health providers, including doctors, dentists, chiropractors and hospitals, must use when billing for a health care claim.

“Each year, more than 55 million medical bills, known as health care claims, from these health care providers are processed in Minnesota, resulting in significant transactions costs — and opportunities for savings,” the Minnesota Department of Health said in a statement.

The changes “may be especially challenging” for small health providers, Haugen said. Most offices already have begun implementing the changes.

“I’m sure it’ll save a lot of money and help everybody. Some offices will probably have a little harder time,” said Connie Reinhart, office manager at Amethyst Dental Care in Rochester. Her office has already been using the new system and is putting final touches in place. She has already noticed quicker turnaround on claims, both for patients and for the dental office.

“We do ours through a clearinghouse. You just send it and in seconds they’ve got it,” Reinhart said. She also expects to save postal costs.

It’s about twice as expensive to send paper instead of electronic forms, Haugen said.

“I think there’s growing interest and growing acknowledgment that there’s really some potential for savings,” he said.

What happens if a health provider prefers paper and ignores the law?

Haugen said the statute encourages voluntary compliance but allows fines of up to $25,000 per year. If every state saved as much as Minnesota expects to, more than $3 billion could be saved annually nationwide.

“I think we’re very hopeful that the country as a whole will take a look at Minnesota and expand that dialogue about how we can reduce these health care administrative costs and how we can streamline these health care administrative transactions,” Haugen said.

On Dec. 15, health providers and insurance companies will also have to electronically file “adjustments to or denials of” claims.

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OCALA — For many doctors, the toughest part of the job isn’t the grueling work schedule or the never ending license requirements, it’s the bottom line.

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“The hardest part of being a doctor is getting paid,” said Betsy Diago, owner of [...]]]> By Jeff Brooks, Special to Ocala Business Journal

OCALA — For many doctors, the toughest part of the job isn’t the grueling work schedule or the never ending license requirements, it’s the bottom line.

Related Links:

“The hardest part of being a doctor is getting paid,” said Betsy Diago, owner of Ocala-based medical billing company The Claims Doctor Inc.

Health care is America’s fastest growing industry and currently accounts for 16.7 percent of the nation’s gross domestic product. In Florida, health care is a $100-plus billion industry with more than 56,000 licensed physicians statewide. With 78 million baby boomers approaching retirement age and needing increased medical care, doctors will be overloaded with patients, leaving little time to deal with insurance companies, HMOs and billing matters.

That’s one reason why more and more physicians are turning to companies like Diago’s.

“Billing is a full-time business and in many offices the doctors are trying to use somebody to do their billing who also have other duties,” said Diago, who started her business 14 years ago in Tampa before relocating to Ocala. “That’s very difficult for someone to do. It’s an extremely demanding part of a practice.”

Shirley Fernandez, owner of Dimond Billing Service, has been involved in medical billing since 1992. Her business is “booming” because with the current economy doctors are able to cut costs by outsourcing their billing.

“If the doctor doesn’t want to have a staff at the office, if they don’t have the space or don’t want to pay extra staff, they can get a contract for a fee or a percentage,” Fernandez said. “It gives them more time with patients. There’s less people calling into the office getting people distracted with the billing end. They focus on taking care of the patients and don’t have to deal with patients complaining about bills.”

Cyndee Weston, executive director of the American Medical Billing Association, has been seeing steady industry growth since she started the organization 11 years ago. Three years ago she had about 900 members. Today, that number tops 1,200 members.

“There’s always going to be sick people so there’s always going to be a need for claims to be filed,” Weston said. “Every other industry embraces outsourcing the services they’re not good at. Health care providers have been slower to embrace the outsourcing of their billing, but with the downturned economy they’re trying to save money just like everybody else. Billing is costly, especially when claims aren’t paid the first time.”

Dr. Karl Altenburger, a retired Ocala physician and immediate past president of the Florida Medical Association, said physicians are always looking for ways to be more efficient on the business side of the practice, which is one reason the FMA fought for assignment of benefits legislation requiring insurance companies to send payment to physicians rather than patients.

“Insurance companies are always trying to intimidate the doctors,” Altenburger said. “They don’t want to honor an agreement between a patient and a doctor when the patient freely gives assignment to the doctor so they’ll send a check to the patient and some turn it over to the doctor and some don’t. Then you have a collection issue and that takes time, adding to the cost of running your business. You don’t want to do that. You’d rather be spending those resources providing better services.”

Ronald Renuart, an osteopathic physician and first-term member of the Florida House who sits on the Florida House Health Care Services Policy Committee, said the Legislature heard the FMA’s concerns and responded.

“One of the things we did accomplish for physicians was to change the rule on the assignment of benefits,” Renuart said. “Now, if a patient requests his insurance company assign benefits to the doctor, the insurance company will be required to pay the benefits wherever the patient decides.”

Renuart said the current Legislature is “very physician friendly” and would look favorably at any new ideas that would help decrease the burden on physicians to make collections.

“Right now, we’re coming up with ideas for bills for the 2010 session, but I haven’t heard of any new bills being filed to that effect,” Renuart said.

In his practice, Renuart is part of a large group of partners who pay a management fee, covering their billing and collections.

“It takes some of the headache away, but it is costly,” Renuart said. “By having a large group of doctors it keeps our expenses lower. Traditionally, when you left the doctor’s office you’d pay the bill. That’s kind of gone by the wayside because insurance companies pay certain percentages and it’s getting so complicated patients don’t know when they leave how much they owe.”

Folks at the Florida Agency of Health Care Administration understand how confusing and complex billing statements impact physicians and they’ve instituted a proactive, agency-wide program called AHCA-cellerate in an effort to reduce the amount of paperwork and administrative burdens the state places on physicians by utilizing an electronic health records system.

“There is electronic billing available to every physician in Florida,” said Christopher Sullivan, administrator of the office of health information technology for AHCA. “We are working with it on a contract to deliver Medicaid claims data to physicians. It’s a way physicians can get a history on a patient before a patient comes in as well as a medication history. That informs the physician of previous billing and previous procedures which would make a difference, we hope, in the quality of care a physician give a patient.”

Another idea being pushed is a health records system, which would be located in the physician’s office and would allow the physician to computerize all of his or her procedure codes.

“When you have a procedure, they put it in a laptop and it gets collated by the central server,” Sullivan said. “It not only assembles all the billing it determines the most appropriate procedures to bill for. Then it rolls it into a bill the physician can submit. It makes it easier to bill and maximize his work.”

Currently, Sullivan said, 35 percent of Florida physicians have electronic health records systems. Under the economic stimulus bill, physicians who see a lot of Medicaid patients will receive up to $25,000 to purchase a system and hospitals get a 100 percent reimbursement. They’ll also receive incentive payments to use the system.

“It will cut a lot of staff time,” Sullivan said. “It translates into lower health care costs and better health care.”

According to Robert Mills, a spokesperson for the American Medical Association, there is a great deal of non-standarized practices in medical billing and some health care plans are taking action so payment policies are more transparent. One thing being discussed is real-time claims, in which patients swipe cards and the physician can tell them up front what their payment obligations are and they can pay the bill before leaving the office.

Tom Menichino, chief executive officer of Family Doctors of Belleview, recently started using a similar system.

“We signed up with a company that allows us to do away with the actual credit card machine,” Menichino said. “Now, it’s all done at the computer where the checkout person is working. When the patient is ready to check out, we can get online and it will tell us this patient is a co-pay patient that owes us $25.00 or the patient has a deductible and they haven’t met their deductible. More importantly, it a patient has difficulty paying the whole account it will set up a schedule on how to debit their account.”

Menichino said because of their size, they do most billing in-house because they are familiar with the accounts, which helps them stay on top of things. He said that might not be the case for smaller practices.

“We can afford the overhead to do that as opposed to a solo doctor,” Menichino said. “They might not be in a position to spend resources to go after open accounts. Some small practices have outsourced to some of these billing companies. There are some pros to using some of these companies. The cons are you’re not in control so you have to work closely with those companies and be sure that they’re following your policies.”

As health care grows, many see medical billing keeping pace.

“I think it will definitely continue to grow,” Diago said. “For the individual practitioner especially, it makes a lot more sense to be able to have a professional that you know knows what they’re doing.”

In an industry where certification isn’t required and self-regulation is the norm, there is one aspect creating apprehension for Diago and others in medical billing: government regulation.

“As we see the changes that are going to be coming with regard to health care there will probably be more and more regulation.” Diago said. “I don’t agree with the proposals on the table right now, but I do recognize that one of the things the government seems to be intent on right now is more government control and regulation. I don’t think it’s necessarily a good thing. I think it’s important from a standpoint of doing things the right way, preventing fraud. As far as having more of the government in everybody’s pocket, it’s not a good thing.”

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Above article published on http://www.ocala.com/article/20090528/OBIZ/905289965/1357/
obiz?Title=With-doctors-workloads-increasing-medical-billing-becomes-growth-industry

[...]]]> The ink was barely dry on last Sunday’s column when friend Tom Diffenbach sent me an article from the previous day’s New York Times about primary care physicians who bill their patients directly and save a ton of money on administrative costs.

The number of so-called “patient-centered” practices is growing, the newspaper said, because doctors find they can spend twice as much time with patients and cut their overhead by as much as half by using new technologies and avoiding the red tape of filing insurance claims.

One Seattle physician charges her patients a monthly fee of $54 to $129, based on age, and encourages them to purchase a high-deductible insurance policy for serious illnesses. She spends 30 minutes to an hour with each patient.

The doctor who runs her clinic told The Times that patients can save 15 percent to 40 percent on health care, in large part because good primary care can obviate specialty care. The clinic has two administrative employees, but it would need one or two for each of its seven doctors, he said, if they had to file claims with various insurance companies.

Direct billing for primary care is a throwback to the days when doctors made house calls, patients generally paid in cash at the time of service, and people bought insurance to cover hospitalization and extraordinary care.

But during the last half-century of medical progress, insurance plans have evolved to cover virtually every facet of care. And that appears unlikely to change as Democrats in Congress focus on reform plans that reportedly will require every American to have health insurance, purchased either by individuals, their employers or the government.

In Harrisburg, one key issue for the state budget for fiscal 2010 is a proposed expansion of government health insurance to “cover all Pennsylvanians.”

This is not to suggest that insurance isn’t a necessity, considering the price of modern medical technology.

But it’s clear that the insurance system as it exists places an administrative burden on health care providers that drives up all prices for everyone. A recent Weill Cornell Medical College study found that primary care physicians spend a third of their revenues on interactions with patients’ health plans.

Significantly cutting administrative costs means that doctors can spend more time with each patient and see fewer of them without sacrificing income. By contrast, insurance companies and the government attempt to hold down costs by limiting reimbursements. That forces doctors, in order to maintain their incomes, to see more patients, spending less time with each, and to send them to specialists for tests and consultation that might be performed in their own offices if they had more time.

While health care industry leaders recently pledged to streamline administrative processes, there remains an inherent inefficiency for doctors and other providers of having to deal with myriad insurance plans that cover various procedures at different prices. However, uniform coverage for everyone under a single-payer system, such as Canada’s, isn’t about to happen here, unless by evolution.

President Obama says any reform package will allow consumers to keep their current coverage if they’re happy with it. That presumably includes health savings accounts, which allow consumers to accumulate money tax-free and spend as they choose on health care, so long as they buy high-deductible insurance as a backstop. Patients with HSAs might choose a “direct-practice” clinic such as the one in Seattle, so long as their high-deductible policy didn’t require the clinic to charge a certain fee and submit paperwork through the insurance bureaucracy.

According to The Times, 60 percent of all bankruptcies in the United States in 2007 were driven by health care costs. This clearly is an issue that needs to be solved, and, lo and behold, some physicians appear to be pursuing one viable solution to a part of it. Any reform plan, to be successful, must support and even foster such innovation.

But a lot of people have a lot of interest in maintaining the status quo, and they have the best lobbyists money can buy plying the halls of Congress for them.

Thoughtful consumers — and providers — will need to be assertive in making their voices heard.

Dale Davenport is the former editorial page editor, now retired: daledavenport@comcast.net.

Above article published on

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