Latest News

Is the Beacon Turning Off?

Posted by on Feb 9, 2016 in Latest News | Comments Off on Is the Beacon Turning Off?

Physicians in Florida must now get pre-authorization for many typical lab tests They must also use separate proprietary software to do so Physicians are fighting back against the cost-cutting programs Many physicians in Florida are more than a bit upset about UnitedHealthcare’s (UHC) BeaconLBS® program, which is managed by Laboratory Corporation of America.  The key frustration seems to be that for many of the typical lab tests, physicians must now get a pre-notification or pre-authorization, and they must use BeaconLBS’ own system. This frustration is echoed in Florida Senate Bill 1084 which would limit these “benefit management programs” (read: cost cutting programs). Why is UHC doing this? The goal is, since the physician now has to get a pre-authorization for these simple tests, and UHC now has the option to deny them, the volume of tests will decrease, saving money for UHC. So in summary, the referring physicians now have to get pre-authorization for tests which they used to order without any authorization, and they have to use separate proprietary software to do so. If this is the future of healthcare, then it is good to see the physicians pushing back. Many of our clients have been pursued by BeaconLBS over the past few years, and it has always seemed the rules and payment structure where vague. We’ve helped them navigate the issues and fight for their revenue. If you have questions you can contact Mick Raich at Vachette Pathology, 517-486-4262 or at...

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State Medicaid Agencies Balk at Federal Funding for Data-Mining

Posted by on Jan 27, 2016 in Latest News | Comments Off on State Medicaid Agencies Balk at Federal Funding for Data-Mining

By Jacob Vugrinac, Director of Business Development “It is not enough that we do our best; sometimes we must do what is required.” ~ Winston Churchill CMS released information on Medicaid’s sky-high improper payment rates States won’t accept federal dollars to root out the errors It is time for state Medicaid agencies to “do what is required” to stop the bleeding CMS released information regarding improper payment rates … and to put it mildly they are not good.  Abysmal and horrid might be more apt in describing their effort and diligence.  The rate for improper payments skyrocketed from 5.8% or $14.4 billion in 2014 to 9.78% or $29.12 billion for fiscal year 2015. For those of you keeping track, that increase is more than the GDP of Jamaica. Ya Man. No good. Common sense would lead us to believe that states experiencing this increase in improper payments would be enraged and stop at nothing to resolve the issue. But this is the government we’re talking about here, so terms like “common sense” and “reasonable” should be used at your own peril. Josh Devine, a spokesman for the Tennessee Bureau of Investigation stated, “We’ve yet to encounter a situation beyond (our Medicaid agency’s) capacity to provide timely information that would necessitate the extensive investment in personnel, infrastructure and equipment to essentially duplicate those resources.” Contrary to data and common sense (oops I used that word again), many states believe their Medicaid agencies are doing an adequate job at generating leads for them to follow.  Any additional leads would likely cut into their Minesweeper and nap time. The department of Health and Human Services has offered to use federal funding to undertake the data-mining that would put a stop to this drastic increase in errors. This funding would allow Medicare fraud units to delve deep into the issues that are causing this ridiculous increase and drive down the errors as the number of enrollees in Medicaid swells nationwide. But the states say they do not need the help.  That’s like a drowning man saying thanks but no thanks to a life preserver.  And make no mistake about it, Medicaid is drowning. As Churchill stated so eloquently, it is not enough to do your best if it does not get the job done.  It is time for state Medicaid agencies to accept the funding that is being offered and make the necessary changes to stop this madness.  It is time to stop the bleeding.  It is time to do what is required. For questions or comments contact Jake at Vachette Pathology,...

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Think you are getting a 0.5% increase from CMS this year? Think again.

Posted by on Jan 22, 2016 in Latest News | Comments Off on Think you are getting a 0.5% increase from CMS this year? Think again.

Your Real Payment Revenue Changes from CMS in 2016 By Mick Raich, President, Vachette Pathology Thanks to a clause about budget goals, the 0.5% increase will not come to fruition Comparing the new conversion rates reveal a true revenue decrease of -0.1% To understand how this will impact your revenue, contact us today Recently one of my most valued employees, Angela Granlund, Practice Manager Extraordinaire, came to me with a spreadsheet.  It showed the old conversion factor for the 2016 National Physician Fee Schedule which was released on 11/10/2015, compared to the new conversion factor for 2016 which was released on 1/5/2016. Remember that 0.5% increase all providers were supposed to get because we did away with the Standard Growth Rate formula?  Well…as expected you will not be seeing this. In the federal register, where this concept was released, there was a little clause on page 714 that stated if the government did not reach their budget goals, then the increase will not take place. So here is what really is happening. On the November 10th release of the 2016 National Physician Fee Schedule Relative Value File, the conversion factor was 35.8279.  On the January 5th release of the 2016 National Physician Fee Schedule Relative Value File, the conversion factor was 35.8043. This means overall your rates drop from a 0.5% increase to a 0.1% decrease. To see how it breaks down by CPT code, download our comparison PDF: First Name (required) Last Name (required) Your Email (required) If you have questions on this and want to look at your true pathology or laboratory revenue, please feel free to give me call at Vachette Pathology, 517-486-4262.  I will do my best to...

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Moneyball Comes to Medicine

Posted by on Jan 19, 2016 in Latest News | Comments Off on Moneyball Comes to Medicine

By Jacob Vugrinac, Director of Business Development Paul DePodesta, the inspiration behind the movie Moneyball, also works in medicine Data analytics is the standard by which all efficient businesses measure themselves DePodesta says traditions, operational structures & resistance to change stand in the way as medicine begins to explore the opportunity of data Will these barriers prevent you from bringing data analytics to your billing practices? As I a diehard Cleveland Browns fan*, I read with interest that the Cleveland Browns hired Paul DePodesta as their Chief Strategy Officer. Did you know this man, the inspiration behind Jonah Hill’s character in Moneyball, also applies his statistical method to medicine? (*Unfortunately, I must admit that my first picture after being born is in a Browns jersey, so I really had little choice in being miserable every Sunday for the rest of my life.) DePodesta is a Harvard grad who used his obsession with numbers and statistical analysis to change the baseball world forever.  He insisted that the information used in baseball (or lack thereof) to make personnel decisions was archaic and needed to be brought into the 21st century. He knew that baseball was sitting on a stockpile of data and needed to mine through it to find the true indicators of success and failure.  As the movie and history show, DePodesta’s analytical approach was quite successful and was adopted in some fashion by all the teams in MLB.  But it wasn’t just baseball he knew he could change. DePodesta is also an Assistant Professor of Bioinformatics for Scripps Translational Science Institute, where he applies his skills and insight to the emerging field of digital medicine.  DePodesta wanted to get into medicine because he was “looking to apply his skills and knowledge to a field with global impact.”  After he entered the world of healthcare, DePodesta released this statement: “In disciplines as disparate as baseball, financial services, trucking and retail, people are realizing the power of data to help make better decisions. Medicine is just beginning to explore this opportunity, but it faces many of the same barriers that existed in those other sectors—deeply held traditions, monolithic organizational and operational structures, and a psychological resistance to change.” My question to you is simple: are you allowing these barriers to hold back your pathology practice from operating as efficiently as possible?  Are you willing to use data analytics to find the inefficiencies in your billing cycle and see where you are leaving money on the table? My favorite quote from Moneyball is when Brad Pitt (playing GM Billy Beane) is speaking with the head of his scouting department.  The scout is a baseball lifer who has done his job the same way, day in and day out, for 29 years.  He tells Pitt that he is destroying this team with dependence on analytics and data—that 150 years of baseball has proven that there is only one way you can build a team, only one way it can be done.  Pitt looks at the scout and says three words, “Adapt or Die.”  Will you be choosing the former or the latter? Data analytics is the standard by which all efficient businesses measure themselves.  An unbiased, third-party audit of your billing will implement data analytics measures into your practice and ensure that you are both compliant...

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A Case Study on Health System Consolidation and How It Affects Pathology

Posted by on Dec 15, 2015 in Latest News | Comments Off on A Case Study on Health System Consolidation and How It Affects Pathology

ACO Compensation Models Will Lead to Pathologist Employment State’s hospitals consolidate into one health system and start ACO Health system consolidates laboratory services & forces pathology groups to merge Providers must take part in ACO to receive chance at 5% reimbursement increase The next step is pathologist employment Today let’s take a look at a health system that consolidated its laboratory groups, then its pathology groups into a single entity, which they now compensate via a value-based payment model. First, a little history. Before this process began, there were nine separate hospitals located around the state.  These hospitals were served by five separate pathology practices. The hospitals merged over a period of years.  The smaller ones were closed or retooled to be advanced urgent care centers. The bigger ones were also changed by laying off excess administration, expanding the control of the remaining administrators. The next step: merging the laboratories of the major hospitals and closing the labs at smaller hospitals.  The health system built a new core lab and moved all specialties there.  They kept smaller stat labs at some of the larger hospitals, but consolidated histology under one roof. Next, the administration approached the separate pathology practices and aligned all their Part A compensation under the same methodology, at the same rate and key performance indicators. This set the stage for the next change. The administration then picked a “lead” pathologist and requested the groups merge into one larger practice.  Basically, the health system told the lead pathologist, “you merge this together or we will find another option.”  These changes took about three years to complete. The health system started an Accountable Care Organization (ACO) and requested all their providers join. The ACO was very aggressive in signing with the insurance plans in the state and built their compensation rates with value and utilization metrics. If you think this looks a lot like the Physician Hospital Organizations of the early 2000s, you are correct.  The only difference here is these contracts are now built to compensate or penalize by utilization. One unique feature in the ACO plan is a direct 5% withhold (i.e., penalty) for failing the plan metrics.   If you meet the goals, you get your 5%; if you don’t, you lose 5%. Here’s the real rub – if you choose not to be part of the ACO, you don’t have the option to collect that 5% no matter what you do. This type of utilization and value metric plan will only grow in the future, as serves several purposes. First, it forces every group to be part of the deal via the ACO model.  Second, it pretty much guarantees that groups will follow utilization guidelines and eliminate waste. The final step in the process will be to transition the single pathology group from fee-for-service to a salary position.  The health system will push this as a way to control cost and ensure compliance, since in time the health system’s compensation will be tied to an overall metric that includes ALL providers within the system. Mick Raich is the President / CEO of Vachette Pathology.  He can be reached for comment at or...

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Pathology Medicare Revenue Projections for 2016

Posted by on Dec 9, 2015 in Latest News | Comments Off on Pathology Medicare Revenue Projections for 2016

Financial Impact Analyses are underway for Vachette clients In aggregate, we are seeing a 1% increase across the board for 2016 revenue We are at the year’s end again, and it is time to do our projections for 2016.  At Vachette, we take this very seriously. We look at each of our 94 clients and try to determine how the new CMS Physician Fee Schedule (PFS) will affect their income. It is interesting this year, because there was a CMS fee schedule change in July. This was part of the Standard Growth Rate changes which determined that all providers would get a .05% increase.   This was added to the Sample Impact Analysis below, and we see that almost across the board there is a .05% increase. A new fee schedule came out this fall for 2016, again with some changes.  For example, 88305-26 (surgical pathology, gross and microscopic examination) will go up 1.5% while 88311 (decalcification procedure) goes up 1.6%. There are also some interesting losses: 86334-26 (immunofixation electrophoresis; serum) goes down 1.9% and 76098-26 (radiological examination, surgical specimen) goes down 0.3%. These changes are as interesting and as confusing as our federal government. The sample analysis below was developed by looking at practices’ CPT volume by CPT code, then multiplying this versus the July 2015 PFS and the November PFS, noting the changes.  To perform this audit accurately, you must have a charge volume by CPT, preferably by date-of-service. We also included the practices’ geographic location as CMS pays differently for each area in a given state. This table only shows our clients’ Medicare rate changes. We know their managed care plans should be following these changes as well.  Therefore, a revenue projection must also be performed on these carriers. This process of actually predicting our practices’ incomes allows them to make decisions that help them run their practices like businesses, being proactive instead of reactive. The next step in this whole process is to audit some payments from January 2016 dates of service to ensure both CMS and the private insurance plans have made the payment changes they were supposed to make. This is an ongoing process, and this is why we audit our practices at least three times per year. A good 75-step detailed revenue audit helps keeps our clients on line. Summary of 2016 Changes to Pathology Practice Revenue Overall the CMS changes for 2016 are nominal for most practices; our example below shows a slight increase in aggregate of about +1% – not bad.  You should know how your business is going to change in 2016.  With all the payer rules and system consolidation, it is imperative that you stay on top of your payments and how they will play out.  Failing to be attentive can lead to the demise of your practice.  If you are not seeing a 1% increase across the board by March 2016, perhaps you should look into it and start auditing. Source:

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Video: Current Issues in Medical Billing Auditing and Compliance

Posted by on Dec 4, 2015 in Latest News | Comments Off on Video: Current Issues in Medical Billing Auditing and Compliance

As a pathology practice management and auditing firm, Vachette sees it all. Hear Vachette President Mick Raich talk about some of the “scroogy” things going on lately with medical billing, compliance and government regulations.

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Vachette Pathology Newsletter – Fall 2015

Posted by on Nov 19, 2015 in Latest News | Comments Off on Vachette Pathology Newsletter – Fall 2015

Our quarterly newsletter is out! To download this collection of our best articles and social media updates from the past few months, please join our mailing list. We promise not to share your email or send you spam, and you can unsubscribe at any time. You’ll be one of the first to know when we publish the next Vachette Pathology newsletter. First Name (required) Last Name (required) Your Email (required) You can also find our past newsletters here: Summer 2015 Winter 2015 Fall...

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Understanding the PAMA Regulation for Lab Reporting

Posted by on Nov 18, 2015 in Latest News | Comments Off on Understanding the PAMA Regulation for Lab Reporting

If you answer YES to any of these questions, you’d better read further: Am I a lab as defined by CLIA, or do I have at least one component that is a lab? Is my entity reporting under a unique Tax ID number under which all NPIs of the entity are associated? Does my Tax ID receive more than 50% of all Medicare revenue (meaning allowed amounts) from fee-for-service payments under Medicare part A, B, C and D? If yes, you can be exempted from reporting if your CLFS revenues are less than $50,000 in a year (or less than $25,000 in 2015). This caveat provides a full exemption for you, even if you answer yes to all of the above. By now we have all heard about the PAMA regulation for lab reporting, but do we really understand what this is and what it really means to each of us?  Below is a just a little breakdown giving the what, when, who, and why of this regulation. WHAT:  The general idea of lab reporting is to provide CMS a foundational average payment by private payers on clinical lab services.  With this information, CMS will then start making reductions on the Clinical Lab Fee Schedule going forward. WHEN: This is still in the comment period.  People have the option to comment up until Nov 24th.  These comments can help ensure clarification of the regulation, as well as help direct some much needed changes.  If this rule goes through, the initial reporting period begins Jan 1, 2016, and you have until March 31, 2016 to get your reporting completed (reporting data from July 2015-Dec 2015). WHO:  This has been the biggest question of all.  Below is a breakdown of questions to ask to determine if you fall into the requirement for reporting.  If you answer yes to any of these questions, then you are a group who needs to report.  If you fall in this category, be sure to review the final point below, as this may be the one item that will provide a full exemption for you: Am I a lab as defined by CLIA, or do I have at least one component that is a lab? Is my entity reporting under a unique Tax ID number under which all NPIs of the entity are associated? Does my Tax ID receive more than 50% of all Medicare revenue (meaning allowed amounts) from fee-for-service payments under Medicare part A, B, C and D? If yes, you can be exempted from reporting if your CLFS revenues are less than $50,000 in a year (or less than $25,000 in 2015). This caveat provides a full exemption for you, even if you answer yes to all of the above. WHY:  CMS was ready to make CLFS cuts across the board, which would have been implemented in 2015.  This regulation is giving labs the opportunity to drive these cuts.  This is why the comment period is so important.  With the lack of hospital labs participating (a really large part of the market), this will drive the actual payment per CPT down substantially, and we know if the CLFS goes down, the commercial carriers will follow suit.  Kiss your clinical lab revenue goodbye. So, given this information, where do you go from here?  We...

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Medical Practices & Billers Must Stay Vigilant in State Budget Crisis

Posted by on Nov 2, 2015 in Latest News | Comments Off on Medical Practices & Billers Must Stay Vigilant in State Budget Crisis

Illinois out of money as their budget is stalled. How does this affect providers? How would you track this missing money? What would you do with a 16.5% cut in Medicaid? Illinois still does not have a budget for the fiscal year that stared July 1, 2015. And apparently, there isn’t an end in sight.  The Republican governor and the Democratic Legislature in Illinois cannot agree – thus a stalemate (the longest in state history) that has stretched on for almost 5 months. At this point, the majority of state programs continue to be funded (putting the state further into debt), and there’s been no government shut down — yet.  But, without a budget deal and with a growing list of unpaid bills, many worry the state will not be able to pay its employees, schools or bondholders. What about Medicaid?  What about state-funded insurance plans such as Cigna and Health Alliance?  We already see a large delay in payment for these plans – will payment stop altogether? Illinois also, as of May 1 of 2015, initiated a 16.75% reduction in reimbursement for Medicaid payments due to budget woes for the 2014/2015 fiscal year.  This cut was for services May 1-June 30, 2015. However, there’s been no communication thus far on whether the previous reimbursement rates will be reinstated once the budget has been passed. Due to this budget crisis, and the current and future financial uncertainty with state-funded insurance plans, it is imperative that billing agencies remain diligent on capturing charges. They must also maximize collection efforts with all other insurance plans. Billers should use reimbursement tracking, denial reporting, and revenue variance reports to identify payment issues, so their team can quickly assess issues and positively respond to negative trends. Vachette and Stark Medical Auditing work with medical groups and their billing agencies to maximize revenue, even in times like these. With clients throughout the United States, we are in tune with multiple state issues and how they impact your bottom line. The question to Illinois providers is, “Who’s watching your wallet?” Source:...

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