Posts made in 2006

2007 Medicare Changes – Update

Posted by on Dec 11, 2006 in Latest News | Comments Off on 2007 Medicare Changes – Update

Great news! Vachette Pathology has learned that the Tax Relief and Health Care Act of 2006 has passed both the House and the Senate. The final bill includes the elimination of the January 1,2007 scheduled ‘5.0 percent’ decrease in reimbursement for physician services. Instead, it mandates a one-year freeze on the current Medicare rates. The bill also includes continuation of the exception that allows independent laboratories to bill for the technical component of medical services. Once this has been signed by the President, CMS must write regulations and put the new changes into practice. For more information, please contact Mick...

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Billing Done by Publicly Traded Company? What is at Risk Here?

Posted by on Oct 5, 2006 in Latest News | Comments Off on Billing Done by Publicly Traded Company? What is at Risk Here?

The main factor at risk is the money you put into your pocket. Dealing with a billing agent that is publicly traded can result in your hard earned income being taken from your pocket to cover the companies expenses, not to mention to put more money into the shareholders pockets. Less then 1/3 of publicly traded companies have Wall Street analyst coverage due to the cost and difficulty of getting and analyzing financial data. The catch 22 is with out this data, not only do investors suffer, but the companies themselves cannot maximize their ability to raise capital. Out of pocket expenses incurred with the initial public offering can range between $175,000 and $500,000. In addition, the ongoing expenses can be very significant, these will include: Annual listing fees Public relations Investor relations Quarterly reporting Annual audits Annual reports Shareholders ‘meetings, etc. On top of all this, the main goal of management in a publicly traded company is to maintain and then increase shareholder value. Key factors in determining shareholder value include: Price-earning and dividend ratios Earnings per share Overall liquidity of the companies stock The price of the stock in turn will be a factor in management decisions for the simple reason; a shareholder expects to make a profit. The investors will expect quarterly profits that are consistently higher then the last. This usually results in a push for short-term earning results. So how can a billing agent consistently raise profits and continue to cover expenses? Simple, consistently raise the cost of their service. The pressure to maintain this growth may cause management to loose sight of their mission; Satisfying the customer (i.e., YOU). Their new goal in business becomes satisfying the shareholder. Do you want to take a back seat to somebody that has no interest in your financial future just because they bought stocks in your billing agent? Vachette Pathology has been successful nationwide reversing the trend of your workload increasing and your payments decreasing. We have helped over 300 pathologists to put more money back into their pockets. Our main goal is to increase your income, and put more money back into your pocket, not a shareholders. If you have any questions or for further information on this subject, please contact Mick...

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MMO changed their Traditional Fee Schedule

Posted by on Jul 28, 2006 in Latest News | Comments Off on MMO changed their Traditional Fee Schedule

Effective May 1, 2006 Medical Mutual of Ohio made some significant reductions in their Traditional fee schedule. The new rates have decreased dramatically from where they were prior to this change. It appears the reimbursement rate for an 88305-26 has decreased approximately 60-70%. For more information, please contact Mick Raich.

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Case Study: Increasing Practice Revenue through Managed Care Negotiations

Posted by on Jul 24, 2006 in Latest News | Comments Off on Case Study: Increasing Practice Revenue through Managed Care Negotiations

The group: A six person pathology practice providing services in a hospital based environment. Last year we were contacted by this pathology practice, and their main issue was a slowly decreasing revenue stream and increased expenses. They assumed there were some changes in their managed care profiles. We provided an audit and did an extensive review of the practice and found one of their larger payers was paying at a rate that was less than Medicare. The actual rate paid was $35.00 on an 88305-26. As one of our tasks we decided that we would try to increase this compensation. Step One: We met with the hospital administration as this was a hospital based practice. We asked administration for their support as we moved through this process and they agreed to help. Step Two: We entered into discussions with the payer and tried to increase our rate through negotiations. We tried all of the formal channels of communication and provided documentation of our efforts. The practice and the plan were not able to agree on a reasonable rate of reimbursement, applicable filings etc. Step Three: After much discussion and several attempts to reconcile, the group terminated its contract with the payer and began to monitor its payments. Step Four: During our monthly reviews we noticed that the terminated payer had started to route the claims through a third party network that the group was participating with and the reimbursement on the 88305-26 had increased to $60.20, which was an increase of 172%. This still did not meet our expectations for this product and CPT code. Simply put, instead of paying the claims as non-participating, the plan in question shifted the administration of these claims to another network in the area that the plan was participating with. Step Five: After discussions and consultations, we decided to terminate the network that the claims had been forwarded too. Again we continued our pursuit of higher reimbursement and decided that canceling this plan was needed. Step Six: We again started to monitor the reimbursement for the original plan and now noticed that the payer has found yet another third party administrator (TPA) to route its claims through, but this time the reimbursement increased to $152.25 on an 88305-26, which was an increase of 435% over the initial rate. At this point we decided that this payment was adequate for services provided. Step Seven: Now that we have reached an adequate reimbursement, it will be necessary to monitor payments for all the payers to ensure that the plan does not find another place to administer these claims at a lower rate. Conclusion: Many groups have numerous contracts with direct insurance plans and with various local and regional networks. Insurance companies have learned to move claims to the lowest payer and only hard work, steady negotiations and diligence will prevent this from decreasing your practice’s income. This simple case review took about 18 months worth of time and effort, and the changes made must be continually audited to make sure the money is not again shifted to another payer or network or TPA. This close attention to detail paid off with higher revenue for the same amount of work. Look at the facts: Initial Payment 88305-26 = $35.00 First Network payment 88305-26 = $60.20 Final TPA Payment 88305-26 = $152.25 After our work was completed the group gained approximately $35,000.00 per month in additional...

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Managed Care Payment Shopping

Posted by on Mar 23, 2006 in Latest News | Comments Off on Managed Care Payment Shopping

As we audit pathology practices across the nation we are finding a disturbing trend. Many managed care plans are tied into large networks that allow the managed care plans to “shop” their payment around to the lowest bidder. You may spend a considerable amount of time and money re-negotiating a managed care contract only to find your plan has shopped your claim to a re-pricer. What are these re-pricers? Often they are disguised as a network or a Third Party Administrator (TPA.) Their contracts are vague and often include a laundry list of plans they work with. These plans are listed as “possible business relationships, actual plan participation may vary.” The goal is for the network to get as many physician groups contracted as possible at a “usual and customary fee,” and then shop this low rate out to other providers. The network then takes a margin on the difference between what you are paid and what they have negotiated. You may think you have a good contract negotiated with a local insurance plan only to audit this plan several months later and find you are not getting the rates you negotiated. Many times you will find that the volume of this plan has greatly decreased. Conversely, you notice that your overall payments have slipped 3% over the same two months. In researching these cases we usually find that the claim has been sent to a TPA and re-priced. For example, you sign an insurance contract to pay $70.00 on an 88305-26, and the network / TPA has a rate of $50.00. Your insurance plan then ships the case to the TPA who pays you $50.00 and keeps $10.00 on the transaction. The original plan saves $10.00 also. Everyone wins except the pathology practice. In this case the plan simply found a lower bidder and took the lower rate. You do not notice this until it is too late. How do you stop this payment shopping? First and foremost you need to make sure you do not sign any network agreements or contracts without a complete understanding of how this will affect your income. Many of these networks are actually TPA’s and do not actually pay any claims, but only re-price them. Second, you need to terminate these contracts. If you are not participating then your claim cannot be re-priced. Third, you need to audit your EOBs and the contacts you have to ensure that you are getting paid at the rate you have negotiated. Often the only way out of this type of situation is to terminate all your network / TPA relationships. In one case the group had to terminate four separate network agreements to reclaim their income. In summary, is it worth the time to do this work? Absolutely. Many pathology groups are losing money due to these contracts. It is critical to look at all your contracts and renegotiate the ones that are underpaying. You should have strong contracts with good payment rates, strong filing limits, and a yearly CPI...

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