Wednesday, October 24, 2012

This was just forwarded to me by one of our professions best activists--Dr. Jim Knight, DC. Thanks for all you do, Jim----and keep up the good work, we all need you, doctors and patients alike!

Why 2012 Health Insurance Report Cards Are Bad News for ChiropractorsWritten by Tom Necela, DC, CPC, CPMA, CCP-P on October 23rd, 2012

Topics: chiropractic billing, chiropractic collections, chiropractic insurance

The National Health Insurance Report Cards recently celebrated its 5 year anniversary of giving geeks like me a lot of the dirt and data on how insurance is paying (or not paying). The 2012 version of the report cards were not very different from previous years. Although a few payers made improvements, most are woefully slow, problematic and downright secretive with how claims are processed and providers are reimbursed.  While these report cards are not specific to chiropractic itself, there is much we can learn as a profession from this data.

As an individual business owner and our calendar year is winding toward a close, this is also an important time to consider the direction of where you want to take your practice for 2013.  Integral to that plan may be the decision to continue to be a provider for certain insurance payers – or whether to not accept that insurance at all.

So, below is an “executive summary” of some of the highlights of the report card from 2012 as well as 5 year trends.  If you’d like to read all about it in full gory detail, you can click here.

Error Rates

Error rates for private health insurers as a whole on paid medical claims dropped from 19.3 percent in 2011 to 9.5 percent in 2012.  Although there is certainly an improvement here, that’s still a whopping 10% of claims that are paid incorrectly!
Fee Schedule Match

  • It would seem obvious that a payer would pay according to its own fee schedule.  Unfortunately, many payers have been found to “accidentally” pay you less than their already pitiful rates.

Unfortunately, the category of MEDICINE, which almost all chiropractic procedures are paid under, is subject to the worst abuses! CPT Codes in this category were only paid correctly 88% of the time!
  • Topping the list of the most egregious offender for all states was Regence BCBS who only managed to pay claims according to contracted rates 86% of the time; runner-up on this bad list was Anthem BCBS who honored their contract 89% of the time.
Scraping the bottom of the barrel is one state is Humana, who paid Kansas DC’s correctly only 20% of the time. Second dog is in the chiropractic mecca of Iowa, where HCSC honored their contract with Iowa DC’s only 48% of the time!
Payment Timeliness

Late payments irritate everyone.  Worse, they handicap cash flow and your profitability.  Most states have prompt pay laws, but apparently some losers don’t like to adhere to them.
  • Regence BCBS tops the list again, paying only 80% of their claims in a timely manner.
  • Denials and $0 Payments

  • Worse than a late payment is the denial or a claim line paying $0.  Certainly, some of these are your fault.  But some payers are notorious for frequent denials or mistakes processing a claim – whether correct or not. Unlike the late payment, the denial not only means you get no money, but it also produces more work on your end to fight for your hard earned money.
  • Anthem BCBS leads the pack with the largest percentage of $0 claim lines – a whopping 27% of all claims paid.  
  • HCSC and Cigna aren’t far behind, denying 25% and 24% of all claims, respectively. 
  • Aetna and UnitedHealthCare round out the loser’s list, denying more than 20% of claims as well.
Payer Specific Claim Edits

In a perfect world, all payers use CPT or Medicare guidelines to administer their policies.  They are published, generally clear and easy to access.  Unfortunately, welcome to 2012 and the land of “proprietary” edits. Essentially, payers make up their own rules about which codes and code combos they will or won’t pay.  Worse, many payers make these policies very difficult or impossible to find – that is, until you get a denial!

The sneakiest payer in this category is Aetna, who uses its own proprietary edits nearly 89% of the time.
Anthem is in second place at 77% and Humana trails at 54%.

Total Number of Claims Edits

For those of you who can’t quite put a finger on what those percentages mean, the total number of claims edits gives you a more tangible number.  This figure represents the total number of edits – rules, if you will – that the payer uses to administer their claims.

Medicare takes #1 in this category with an equally unfathomable and horrifying 19, 683, 450 claim edits for you to navigate to get paid properly!  No wonder why there is such trouble with Medicare!!!
UHC and Anthem don’t even come close, but still have 82,000 and 63,000 claim edits to create many hoops for you. Finally, no surprise, Aetna makes this list with a horrifying 62,335 claim edits.
What Chiropractors Need to Do About This

  • 1. Keep a close eye on your EOB’s:  Sure, you may be at fault for low payments, but as demonstrated above, it may be insurance shenanigans!

2.  Appeal Incorrectly Processed Claims!  The good news is that the majority of appeals actually win (64%, according to a recent study); the bad news is less than 10% of claims are appealed!  Consider getting our newly revised Chiropractic Appeals Toolkit (click link for more info), if you need help in this department. It includes even more letters than the popular previous version to fight the madness.

3. Do the math and drop bad payers:  if you have a payer that is in the frequent violator list and they create huge payment hassles for you, it’s time to consider dropping them.  Your time (and that of your staff) is worth something.  And that $0.27 check is probably not enough.  Either do something about the insanity or get off the plan.

4. Make Noise!  Join your state and/or national association and tell them how the payers are trying to raise your blood pressure to a boiling point.  Complain to the Insurance Commissioner. And tell your patients the truth about their lying, cheating, sneaky health insurance so that they can use their muscle too!

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