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Updating Your Fee Schedule

Many practices may be losing revenue because of outdated fee schedules. With the changing medical reimbursement and payment landscape, it might be a good time to think about resetting your fee schedule.

Setting a Fee Schedule

Consistency in what you charge is important because it helps determine your account receivables. Using many fees that are various multiples of Medicare allowables complicates the AR picture. Another goal to aim for is to minimize any money left on the table. If $200.00 is paid for a service, the full $200.00 and maybe more needs to be billed. However, you don’t want to drive away patients by charging too much for services so it is a balancing act.

To set a schedule, perform some due diligence and find out what Medicare and private payers are reimbursing you and compare that to your charges. Discover what other area providers charge or commission a consultant or in-house cost study.

Another starting point is to use 150% to 200% (300% for specialists) of what Medicare charges but mitigate this with what your best reimbursement contracts allow and what other practices are charging.

Allowables

Know all of your allowables. This is the maximum amount your insurance contract will allow for reimbursement. If you’re charging less than that, not only might you be leaving money on the table but you might lull yourself into a sense of complacency about receiving full payments when you could be entitled to more.

Revisiting Your Fee Schedule

In an ideal world, you probably want to look at your fee schedule every three months. You should also be receiving your contracted insurance fee schedules each quarter. Compare your fees to these to determine any service fee adjustments. Definitely, at a minimum, perform a thorough review annually. The reason for this is the ever-volatile dynamics of the marketplace, changes in your own costs and fluctuations in patient volume. This makes it essential to collect the revenue you need to stay in business. A tip off that it’s time to review your fee schedule is if you notice that your payers are consistently reimbursing 100% of your charges.

Fee Setting Best Practices

  • Stay in line with your market.
  • Avoid sudden fee changes. If you have to increase them, do it incrementally.
  • Keep the charges uniform for all physicians.
  • Charge the same fees for all patients unless you discount for self-payers.
  • Review your contracts with your insurers thoroughly.
  • When negotiating payer contracts, focus on raising fees at the low end of the spectrum and specialization you may provide that others do not in your geographical market.

Review your fees as a strategy to stay on top of your cash flow.

Success Stories


Average bill age when our office received: 180 days plus BALANCE: $ 1,233.00 PROBLEM: Claim denied needing primary EOB. SOLUTION: Claim billed to supplemental policy instead of MMAI policy which was effective for service date.
Average bill age when our office received: 180 days plus BALANCE: $ 2,176.00 PROBLEM: Claim denied because of no insurance coverage for service date. SOLUTION: Claim was filed to incorrect claims address.
Average bill age when our office received: 180 days plus BALANCE: $ 1,013.50 PROBLEM: Claim denied because of insurance ID mismatch. SOLUTION: Claim filed to traditional plan vs. community care.
Average bill age when our office received: 180 days plus BALANCE: $ 1,203.00 PROBLEM: Patient disputed charge/balance owed, comparing it to a similar past bill. SOLUTION: Explained itemized charges and balance owed because of deductible. Patient stated first time someone took the time to explain and set up a payment plan.
Average bill age when our office received: 180 days plus BALANCE: $ 1,007.50 PROBLEM: Denied by hospice as non-eligible benefit and Medicare as ID name mismatch. SOLUTION: Verified/corrected Medicare ID, name and date; confirmed hospice non-eligibility.
Average bill age when our office received: 180 days plus BALANCE: $ 1,305.00 PROBLEM: Denied no pre-authorization for service. SOLUTION: 3-way call with patient and insurance. No ER report on file when claim originally submitted. ER report since received.
Average bill age when our office received: 180 days plus BALANCE: $ 1,001.50 PROBLEM: Denied with "misrouted" and "claim not covered by payor". SOLUTION: 3-way call with patient and insurance. Claim was related to mental health so should have been filed through carve out policy.
Average bill age when our office received: 180 days plus BALANCE: $ 1,755.00 PROBLEM: No response from insurance after requested records submitted. Patient stated insurance paid. SOLUTION: Billing office did not receive/post insurance payment. Called insurance and records received but claims representative had not released for processing.
Average bill age when our office received: 180 days plus BALANCE: $ 4,540.50 PROBLEM: Multiple bills, same service dates as claims already paid. Denied due to no pre-authorization for service. SOLUTION: Call to insurance who verified no pre-authorization requirement. Two claims not found. To prevent duplicate denial upon resubmission, account rep notated resubmission for return transportation trip. Proof of timely filing submitted with claims.
Average bill age when our office received: 180 days plus BALANCE: $ 1,180.00 PROBLEM: Denied due to no pre-authorization for service. SOLUTION: 3-way call with patient and insurance. Claim should have been sent directly to IPA vs. umbrella insurance location.
Average bill age when our office received: 180 days plus BALANCE: $ 1,117.00 PROBLEM: Unpaid due to incomplete demographic information. SOLUTION: Contacted pick up and drop off locations. Sent release to obtain information and patient’s name misspelled.
Average bill age when our office received: 180 days plus BALANCE: $ 1,605.00 PROBLEM: Denied due to medical necessity. SOLUTION: 3-way call with patient and insurance. Spoke with multiple reps and received different answers including claim not found. Claim was found with no response from medical board. Patient had to submit medical records.
Average bill age when our office received: 180 days plus BALANCE: $ 1,007.50 PROBLEM: Denied multiple times as duplicate. SOLUTION: Located claim number ID, amount paid and date paid. Claim had already been paid in full but not posted.
Average bill age when our office received: 180 days plus BALANCE: $ 1,650.00 PROBLEM: No insurance on file. SOLUTION: Pick up location was state prison. Located inmate ID and could be billed to prison insurance as still within timely filing limits.
Average bill age when our office received: 180 days plus BALANCE: $ 2,295.50 PROBLEM: Denied as “forwarded to another entity for processing”. SOLUTION: Called insurance for medical group processing information. They did not have claim on file. Resubmitted with proof of timely filing.

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