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What the 4th Annual Payor Survey Means to Chiropractors
What the 4th Annual Payor Survey Means to Chiropractors avatar

Written by Tom Necela, DC, CPC, CPMA, CCP-P on April 27th, 2010
Topics: Billing, Business, chiropractic billing, chiropractic business, chiropractic webinars

gong show

The 2010 National Payor Survey was recently released much to the chagrin of third party payors; not surprisingly, it doesn’t exactly depict the payors in a flattering light.  The survey, which was conducted by an independent research firm, polled hospital and health care executives from all 50 states to extract data on their daily interactions with a myriad of insurance companies to detect trends, problems, and issues to address from a physician’s or facility standp0int.

United HealthCare gets the stinky sock award for the fourth year in a row as the worst health insurance payer in America, with a 2:1 ratio of negative vs positive feedback. Fellow contestants in the “Insurance Payor Gong Show,” Coventry and WellPoint/Anthem also would have received the big gong for their pitiful feedback ratings that included as much negative as positive feedback.  Aetna ranked as the best payer closely followed by Cigna.

This year’s survey also highlighted some interesting categories  as follows:

  • Easiest to Deal With (BCBS) and Most Difficult (United Health Care)
  • Best Reimbursement Rates (United HealthCare) and Worst (Wellpoint/Anthem)
  • Most honest and candid (BCBS) and Least (United Healthcare)
  • Most Timely and Responsive ( BCBS) and Least (Wellpoint/Anthem)
  • Fewest Claims Denials (BCBS) and Most (Wellpoint/Anthem)
  • Best at Processing Claims (BCBS) and Worst (United Healthcare)
  • Best at Fixing Claims (BCBS) and Worst (Wellpoint/Anthem)

So what does this mean to chiropractors, who are “little fish” in the big pond of healthcare?

1.   Anticipate problems — if the insurance companies are unafraid and willing to mess around with the big guys (hospitals, large medical groups), be assured that they will take the same approach to you.  If your major payor is one of the “worst of the worst” keep a very close eye on your billings, accounts receivable and EOB’s — and watch for shenanigans!  If it’s a minor payor (few patients) that gives major headaches, consider dropping them.  See my article on “How to Drop An Insurance Company” for specific strategies.

2.  Fight back — WHEN your claims are paid incorrectly, know your rights to fair/correct payment and appeal.  If you don’t have a fleet of appeal letters for every situation ready to deploy at a moment’s notice, it’s time you prepare for battle.  Start saving them as you write them so you can re-use your appeal the next time around (there WILL be another time) or consider my Chiropractic Appeals Toolkit as a ready-made resource for this purpose.

3.  Form the Roman Turtle. If you know military history, you may have heard about the “Roman Turtle” formation in which the soldiers would configure themselves tightly together. If the enemy shot arrows at them they would use their shields to surround their bodies and protect themselves from all angles. Even with a small group of soldiers, the benefit to banding together like this afforded them excellent protection.  There is simply no way that you, the solo DC, can battle the big guys by yourselves. Now, more than ever, is the time to join your state and/or national association and fight battles collectively.

4.  Work Smarter. Many DC’s enter battle naked or worse, send in their spouse unarmed and dangerous.  A $50,000 coding mistake (actually a $25 mistake made 2000 times over several years) becomes a dear price to pay for ignorance but in virtually every office that I consult with, I can uncover at least that much in income they are either giving away, discounts they are inadvertently giving to insurance companies and services that they are either not billing for or performing incorrectly.  I don’t care which side of the fence you sit on — whether you are more concerned about potentially losing money by doing something wrong or losing out on money that you could have made for services you already performed.  Either way, you are not working smarter, you are simply working harder and harder for less income and more risk.

If you suspect that you are working harder, missing out on income or unnecessarily exposing your practice to audit risk, join us Thursday April 29 for our upcoming one hour, info-packed webinar  7 Ways to Tighten A/R and Increase Profits! where you will discover profitable strategies to increase income, decrease risk and prevent errors that cause you to lose money or leave it on the table!

Can’t make the webinar?  Order it on CD! That way, you won’t miss out on:

** How to manage your revenue cycles for maximum profit + minimum effort

** The ONE rule that will single-handedly guarantee increased profits…IF you follow it!

** How to obtain maximum value for your efforts + time

**What one strategy you are missing that can provide your clinic with extra income with virtually no extra work on your part

** When to use your “secret weapons” to get payment

** How to increase efficiency + decrease staff costs for collections

** How to effectively collect amidst high deductibles, skyrocketing co-pays and the changing health-care marketplace..

To Your Success!

Tom Necela, DC, CPC, CPMA

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Chiropractic Audits — What To Do When You Receive THE Letter!
Chiropractic Audits — What To Do When You Receive THE Letter! avatar

Written by Tom Necela, DC, CPC, CPMA, CCP-P on April 19th, 2010
Topics: Audits, Business, Chiropractic Audits, Documentation, compliance

42-17679037

  • Don’t Panic and Don’t Ignore It! An audit letter is not an automatic presumption of guilt.  Some audits are completely random and conducted routinely with no suspicion cast toward your billing activities, documentation ability or treatment parameters. So do not panic in the presence of an audit letter. Don’t assume that your documentation is substandard. Don’t automatically determine they will find your records insufficient and make plans to be subversive.  On the other hand, do not ignore the audit letter.  Instead, plan to take action.
  • Can I even be audited?  You do have legal rights depending on the state in which you practice and your specific situation. For example, if you are an out of network provider, there is a possibility that the carrier cannot audit unless they suspect fraud.  On the other hand a governmental entity like Medicare definitely can audit you, so move on to the next step.  Perform your due diligence immediately and research this issue.
  • Determine exactly what the audit letter states. Are they requesting a chart audit where they want to look at your medical records?  Do they want to perform a site visit?  Once you’ve determined which type of audit they’re intending to conduct on your practice, you need to formulate response to that audit or to the request that the audit’s making in a timely manner.  In some types of audits, no answer is the worst possible answer you could give.  So you want to respond in a timely manner to the request for the audit.  Also, provide what is requested: nothing more, nothing less.  The auditors do not want to review a 42 page explanation of your chart notes; they should stand for themselves.  Furthermore, any additional material you provide beyond what is requested can be used against you as well.  One tip: do not respond to phone or fax audit requests.  Get it in writing!

  • Do Not Alter Your Documentation. I get many emails and calls from chiropractors who have received an audit letter.  The most common question is: “what do I need to do to prepare for this audit?” To be blunt: the time to prepare for your audit is not when an audit request letter is in your hands! Never take matters into your own hands and alter medical records to improve what appears to be incomplete or insufficient documentation. Poorly done records are still better than the best records that have been fraudulently contrived.
  • Determine IF You Can Meet Audit Requests.  If the time frame that the carrier is requesting is not reasonable due to some sort of extenuating circumstances, contact the auditor for an extension.  If it’s going to take you more time to produce the information, ask for an extension.
  • Is this something we need to appeal immediately? If your “audit” letter is actually a demand for repayment, your best option may be to start the appeals process.  Do not automatically presume that the payor’s review is final or even correct.  If appropriate, an appeal can save you thousands of dollars in unnecessary repayments and headaches.

  • Is this something for which you will experienced assistance? You may need to obtain the assistance of a certified professional coder or a certified professional medical auditor whose expertise is in chiropractic (such as myself) to help defend you.  A healthcare attorney may also be wise, especially if there are several zeros in your demand or repayment letter. Again, before you hit the panic button or get out your checkbook, it may be critical to the success of your defense or appeal to get professional help.  The reality is that your license, your lifestyle and your livelihood may all depend on it!

I hope that you found this article helpful.  For a more detailed discussion on audits, I suggest you check out my program “How to Prepare Your Chiropractic Practice For Recovery Audits.”  For specific questions regarding your own audit situation or letter, you may contact me per the guidelines below.

Due to the large volume of requests that I receive for audit advice, opinions and requests from chiropractors to “look this over and tell me what this means,” I can no longer respond to phone inquiries on this matter.  If you have need for an opinion or objective discussion on audits or demand letters, the need for attorney/ legal representation or appeals, please contact me via a separate email for this purpose at Audits[at]StrategicDC.com.

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Why do Chiropractors consistently overpay their income taxes?
Why do Chiropractors consistently overpay their income taxes? avatar

Written by Tom Necela, DC, CPC, CPMA, CCP-P on April 13th, 2010
Topics: Business, chiropractic business, chiropractic practice management

If today’s blog post title has you perplexed – don’t worry.  I am not masquerading as an accountant or tax specialist.  I have plenty to teach in my area of billing, coding, documentation and profitable business strategies to keep me busy for a long time.

But since teaching chiropractors to work SMARTER in their business is my mission, and since April 15 is near, I thought this would be a good opportunity to host a guest column on an issue none of us can afford to ignore – taxes!

A final word.  There are several reasons that I chose Jim Bowen, JD to author today’s blog post.  Because of the tremendous asset he has been to my business and finances, I have the utmost confidence he can help you too. He understands taxes (most of us don’t) and from working with scores of DC’s over the years, he understands the challenges we face as chiropractors.  Listen and learn.  I’ll see you next week!

Tom Necela, DC

taxes1

Why do Chiropractors consistently overpay their income taxes?

Here is a sobering thought this time of year: between 89 and 92% of all small business significantly overstate their income tax liabilities.  My work with DCs has me believe that their rate is probably higher.  The average discrepancy between what my DC clients were paying and what they actual were required to pay is over $22,400 a year.  Over a period of time, this contributes to a widening separation in net income between the well-run business and the average business.

What accounts for this?

When Money Magazine set out several years ago to find out, they came up with a pretty interesting conclusion.  After working with small businesses for over 20 years and hundreds of DC clinics, I can add some additional reasons why the Chiropractic clinic is uniquely positioned to make quite a bit of money every year, but hands over more to the IRS than necessary:

  1. Working within the wrong entity. Almost every chiropractic office would be tax-advantaged to operate as either an S-corporation, or an LLC that is taxed like a corporation.  Partnerships have several disadvantages while the sole proprietor suffers from the highest IRS audit rate there is as well as the lowest ability to operate efficiently.   Most sole props realize a 30-50% decrease in tax liability simply by converting to a corporate form and accounting properly within that form. Accountants and tax attorneys already operate this way, while DCs are left on their own
  2. Not understanding basic and advance tax planning techniques. Once you have your correct entity, you need to know what to do with it, a subject not commonly taught at your Chiropractic College.  There is not one or two things to employ to achieve Tax Nirvana – it is a sophisticated integration of the clinic operation with the individual circumstances and goals of the clinic owner, that results in a low tax liability within the dictates of the Internal Revenue Code.
  3. Not properly characterizing and documenting income and expenses. Think of this as no different from your business.  If you adjust, but do not characterize correctly or document sufficiently, you will not get paid.  The same adjustment characterized and documented correctly will get paid.  The ability to deduct a private school, children’s braces or a new Lexus also depends upon characterization and documentation.  As in health care, learn the rules and benefit from them.
  4. Relying on an accountant. This is where Money Magazine comes in:  Money sent out a hypothetical tax return to 46 accountants and received…46 different amounts due!  Tax liability ranged from $36,320 to over $94,000 – for the same return.  The reason was obvious: during the season, accountants prepare an average of 6.7 returns a day – not much time for careful consideration of your circumstances.  A CPA is vital to preparing and submitting your returns, but they are just relying on the p/l you submit to them and you cannot rely on them for the lowest tax liability and audit rate that you deserve.
  5. Not having a tax advisor or preventative audit. A tax and accounting review prior to sending your material to your accountant (or better yet, earlier in the year) is what makes the difference.  You should be looking for ways to reduce your chance of being audited, as well as keeping more of your earnings.  This takes pro-active planning with an advisor that understands law, accounting, business planning and has a detailed understanding of the Chiropractic business.
  6. Not looking for improvement. DCs are experts in trying new ways to increase patient visits, collect higher fees and extending that PVA, but they do not take even a few minutes to see how they can reduce their taxes.  Inertia and denial are two main reasons, but overall, it is the lack of understanding that something can actually be done about it.  One of the basic rules of business accounting is:  It is not the amount of money you make that determines your tax liability, but how you take and account for that money that matters.

What can you do now about your 2009 taxes?  Plenty, as it turns out.
First: tell your accountant to file an extension.

Second: Give me a call or email your 08 taxes (09, if prepared).

Third: Take advantage of a15 minute, free consultation to see how far off you are and discover out the easiest way to correctly file your returns.

I review hundreds of returns for Chiropractors every year and it is rare that I find one that cannot be significantly improved.  With my background and experience in law, accounting, business planning along with an extensive knowledge of the DC practice, I provide a unique perspective to you and your clinic.

Interested in learning more?  Take a look at www.bowen.us to get a better idea of how I can help you…this year!

Remember, it is not too late to lower your 2009 taxes.  It just takes action.

James M. Bowen, JD, is the owner of Bowen, Inc.: a for-profit corporation dedicated to strengthening the chiropractic community by helping Doctors of Chiropractic become more efficient.  His consulting service provides efficient DC operations, satisfied and energized owners, increased compliance and guarantees increased net income – year after year.

Mr. Bowen can be reached at 406.370.9900, his email is jmb@bowen.us and his website is www.bowen.us

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Medicare Releases Chiropractic Medical Review Findings for the 1st Quarter
Medicare Releases Chiropractic Medical Review Findings for the 1st Quarter avatar

Written by Tom Necela, DC, CPC, CPMA, CCP-P on April 6th, 2010
Topics: Audits, Chiropractic Audits, Coding, Documentation, EHR / EMR, Medicare, chiropractic EHR, chiropractic EMR, chiropractic coding, chiropractic documentation

detective

Recently, a Medicare carrier (Palmetto GBA) released their 1st Quarter results of Medical Reviews they have been conducting.  Even though Palmetto is only one of several carriers who administer claims on behalf of Medicare, their findings are relevant to chiropractors and, in my experience, reflective of trends across the chiropractic profession at large.

The goal of the medical review program is to reduce payment errors by identifying and addressing documentation and billing errors concerning coverage and coding. In their reviews, Palmetto GBA identified ten problem areas for the first quarter of 2010. These areas were as follows:

  1. Split/shared visits
  2. Signatures
  3. Labels/Diagnostic Testing
  4. Hospital & Nursing Facility Discharge Services
  5. Chiropractic Services
  6. Therapy Services
  7. Individual Psychotherapy Services
  8. Evaluation & Management Services
  9. Legibility

10.  Teaching Physician Services.

Please note this is not an all-inclusive list but does reflect the majority of documentation issues discovered during the review process.  Of this list, however, three items have direct application to chiropractic reimbursements in the Medicare program.

So let’s discuss these three “Frequently committed errors”:

  1. Signatures.  Put simply, Medicare requires an “identifier” for services provided or ordered.  That identifier is your signature – either in handwritten or electronic form.  Signature stamps in your documentation are not acceptable per Medicare Signaure Requirements (See section 3.4.1.1 B) Quite frankly, this is so basic that it is ridiculous that it even makes the top ten. Apparently, despite its simplicity, most physicians seem to overlook it.
  1. Chiropractic Services.  As a relatively small profession, we should not even make the top ten hit list.  We did, however, so now it is our responsibility to correct these problems asap as a profession.  Palmetto found chiropractic documentation to be lacking in the area of Treatment Plans.  More precisely, chiropractors were missing treatment plans with specific objective, measurable treatment goals. Follow thru with these specific objective treatment goals on subsequent visits was also often omitted.  Difficult?  Not very.  Documented?  Apparently, not very often.  Can you fix this, doctor?  Definitely!
  1. Legibility.  If this is not the biggest commercial for EMR, I don’t know what is!  Again, there is no reason any physician should be getting dinged for this one.  Alas, I have seen many of your notes and I sadly agree, that they are barely legible, sometimes only to the highly trained eye (yours and that of your longstanding staff) – and sometimes, even you cannot decipher your own notes.  Put simply, if your notes cannot unquestionably be read by a third-party without eliciting a migraine or use of some special telescopic lens, it is high time to get on EMR.  There are plenty of good systems out there.  In fact, ANY system that produces legible documentation is better than marginal handwriting – and I have yet to see an EMR system that fails to product legible documentation!

In summary, we chiropractors need to get our act together pronto – not only for Medicare, but for all third party payers.  The items above are not difficult to fix, but I realize that some of you are overwhelmed by how much work you have to do to bring your documentation, billing and coding up to acceptable standards.  Others may be so consumed with building your business that you literally don’t have time to look up and see the arrow sailing directly at the target on your chest.  And some of you are just plain tired of putting out the fires in all these areas due to a lack of solid systems that both maximize your reimbursements and minimize your audit risk.

The good news is: help is available. And while it is a physical impossibility for me to assist  all of you with these needs let alone answer the truckload of emails I receive per month on chiropractic billing, coding and documentation questions from random chiropractors at large!  But I am willing to offer a FREE, no obligation look under the hood of your practice for those of you willing to invest the time and effort into completing a Practice Analysis Questionnaire.  Download it, complete it, fax it in today and take a concrete step towards improving your practice, your business, your piece of mind and your life.

To Your Success!

Tom Necela, DC, CPC, CPMA

P.S.      Not sure what can be done with YOUR practice?  Take a look at what my clients have to say about the transformations they have achieved in their practice!

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