Thursday, March 21, 2013

When Should You Use 3rd Party Medical Insurance Claims Requests In Your Practice?

When one thinks of healthcare in the U.S. today, there are three key components to consider. They are the patient, the provider, and the one who pays the bill. It is no secret that the health insurance industry, both government and private insurance carriers, pays for most of the health care for U.S. citizens. About 70% of all the payments to hospitals, doctors, labs, diagnostic centers, rehab facilities, and other certified providers are made by insurance payers. The patients pay the other 30% or so out of their own pockets. What happens when your medical insurance claims are not paid timely?

Medicare and Medicaid are taxpayer-funded and are highly regulated, as are the private payers. However, almost all private health care insurance companies are "for profit." This means that they must take in more than they pay out in insurance claims to providers, and the amount of positive cash flow must be enough to pay all overhead costs, employee salaries, variable expenses, and stockholders, plus a required amount of cash in reserve as required by various federal and state laws. Even Medicare and Medicaid are required to simulate that model, or at least not lose money, which means all payers (both government and private) have strict rules regarding reimbursements, or payouts for legitimate claims. To patients and providers, these regulations may often appear arbitrary and unfair, which is why there are state and federal agencies to monitor and police the insurance industry.

But who acts on behalf of the medical providers? The legislation of the past five years, including the HITECH Act and the Affordable Healthcare Act (Obamacare) has added to the financial burden. The providers, as the recipients of the payment for healthcare services, are feeling the crunch of lower reimbursement from payers, and higher accounts receivable from patient balances.

Downward pressure on Medicare payments is not a new cash flow issue for medical practices. Reimbursement complexities such as this have already led much of the medical community to enlist the aid of third parties to efficiently manage cash flow and accounts receivable in this changing healthcare financing environment.

Though there are state and federal regulations for insurance payers regarding time limits on reimbursements of non-disputed claims, the payers are still often accused, officially and unofficially, of deliberately slowing payments to providers, or simply not paying at all until prompted by the provider who is owed the money. Watchdog agencies, mostly made up of attorneys and consumer advocates, often investigate and expose the most blatant payer indiscretions, but deliberate payment delay tactics are often extremely hard to prove. For providers, the best defense is a good offense and that is why third parties have been so helpful to providers. Overall there is a huge benefit for providers who engage help from outside receivables professionals.

Is 3rd Party Medical Insurance Claims Processing Right For My Practice?

In a recent unofficial poll of a dozen or so third parties, specifically accounts receivable management professionals for multiple medical providers, one recurring theme was revealed concerning how payers responded to inquiries on unpaid claims. In each case the third-party, legally acting on behalf of small medical offices, had better success in obtaining information regarding "non-disputed" unpaid claims than the typical medical office. The reasons third parties appear to fare better with payers can be debated, but one reason is certain. Dedicated professionals who are skilled in cutting through red tape; have time to contact multiple payers at once; and who can prioritize their inquiries to fit the small window of time the payers allot to inquiries, are bound to achieve better results in getting claims paid as quickly as possible.

All payers, government and commercial, will often use lawful tactics and technicalities to slow the process of paying even legitimate claims to providers. Such legal tactics often hinder the busy medical practice, whose multi-tasking employees have scarce time to make frequent calls to payers and wait on hold, sometimes 30 to 40 minutes for responses. Third parties, who are not encumbered with the many tasks of a busy medical practice, can focus on consistent follow-up on these payer claims and often save time for all parties, while making cash flow improvements for the provider.

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