Improving Payment Compliance at Your Physical Therapy Practice

Collecting payment for physical therapy services rendered isn’t easy, but engaging these types of strategies may improve the payment collection process.

As a physical therapist, you spend your days examining patients, developing a treatment plan for each one based on his or her individual needs, then showing them the exercises and stretches they can do to improve function, reduce pain, and limit disability.

While it’s great to know in your heart that, at the end of the day, you’ve helped countless others live a higher quality of life, you also want to get paid for providing these services. Unfortunately, this isn’t always as easy as it should be.

Though there are a number of payment sources for physical therapy claims, most can be broken down into three basic categories: Medicare, other insurance, and patient payments.

Getting Paid for Medicare Insurance Claims

In its Semiannual Report to Congress for the time period of October 1, 2017 to March 31, 2018, the Office of the Inspector General (OIG) shared how it reviewed a random sample of 300 outpatient physical therapy claims submitted to Medicare. Of these, the OIG found that 61 percent (184 claims) were actually non compliant.

The areas where these claims seemed to fall short included:

  • The physical therapy not being proven as medically necessary;
  • The coding was incorrect; or
  • The claim did not meet Medicare’s documentation requirements.

The total amount Medicare paid for these services was $12,741. However, because this sample was just a portion of all outpatient physical therapy claims submitted during this six month time frame, the OIG estimates that the total amount paid on non compliant claims for this service alone was somewhere around $367 million.

To help recoup some of these costs, the OIG has recommended that the Centers for Medicare & Medicaid Services (CMS) notify providers of these over payments so they can investigate and return them as necessary. It has also suggested that the CMS “establish mechanisms to better monitor the appropriateness of outpatient physical therapy claims,” educating providers about how to properly submit their request for payment.

With this in mind, one way to improve and potentially speed up payment for Medicare-based claims is to double check these types of claims to ensure that you provide enough evidence for the need for physical therapy, that the coding is accurate, and that you’ve attached all of the necessary documentation to meet Medicare requirements. Taking this step up front may save you a lot of time and effort in the long run.

Other Insurance Compliance

Although patients may be entitled to physical therapy benefits under other, non-Medicare insurance policies, getting payment for those services can be somewhat daunting for physical therapists. At a minimum, it is usually time consuming. However, there are a few things you can do to speed up the processing of these types of claims.

CareCloud shares that the first step you should take is to review your claims process. Look at how much billing-related data your employees are entering manually and what strategies you have in place to ensure that the information is being entered accurately (such as using clearinghouses or claims scrubbing software). Again, this results in a more issue-free claim being submitted, increasing the likelihood that it will be accepted and paid upon first submission.

Second, CareCloud also recommends submitting your insurance claims every single day. This helps speed up the payment process versus if you only submit on a weekly basis, a process which can negatively impact the cash flow for your office by delaying how quickly you’re paid.

And third, if you’re not already submitting your claims electronically, you’re likely feeling the financial pinch. Not only do electronic claim costs less to process according to CareCloud—at $2.90 for electronic claims versus $6.63 for paper claims—they can also typically be processed faster.

Cash Paying Patients

Insurance coverage for therapy and rehabilitation services has seen “substantial changes” over the past 40 years according to research published in the North Carolina Medical Journal. As a result, many patients now face larger deductibles, co-pays, and co-insurance costs.

Their number of visits are also often limited as well, leaving many patients in a position where they are responsible for paying for a large portion of their physical therapy expenses. But how do you get them to pay?

Advanced Data Systems Corporation shares that there are many things you can do to improve collections from your patients. The first involves educating your employees about the importance of speaking with patients about your payment expectations with compassion, while also clearly explaining their portion of the costs based on their insurance or lack of.

Additionally, if possible, collect payment from the patient at the time of service, offering several payment options so patients can pay in a manner easiest for them. Alternatively, you can also send your bills electronically via email, enabling patients to pay them directly from their bank account while in the comfort of their own home.

Another article published by the American Academy of Family Physicians further suggests putting your payment policies in writing and having your patients sign them before they begin treatment. This tells them exactly what you expect from them as their treatment progresses while also giving you the opportunity to potentially identify problem payers up front if they refuse to sign the forms.

Collecting payment for physical therapy services rendered isn’t always easy, but engaging these types of strategies may just improve (and speed up) the payment collection process.

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