Are you finding that your practice’s fees are below other similar specialties in your area? On your insurance payments, are you noticing that the carriers are occasionally reimbursing your practice 100% of the billed amount?
If you answered yes to either of the two questions above, it may be time to complete a medical practice fee analysis. By performing a complete fee schedule analysis of your current fees versus the carrier allowed amounts, and adjusting your fees accordingly, you can ensure that your fees are above the carrier’s reimbursement for the services that you provide.
- Start with the list of CPT codes billed by your medical practice and reach out to your contracted insurance carriers to obtain their current fee schedules as the fee schedules change from year to year. Some insurance carriers, such as Medicare and Medicaid, list the current and previous year’s fee schedules on their websites while for other carriers you may need to contact a customer service representative, or the carrier’s credentialing department, especially if you have completed contract negotiations with a payer.
- After you have obtained the carrier’s fee schedules, prepare an analysis report of the CPT codes your practice bills, your current fees, and then the allowed amounts for each insurance carrier. If your current fees are under, or at the carriers allowed amounts, you will want to look at increasing your fees, because you’re not receiving maximum reimbursement for the services that you are providing. The carriers typically will not reimburse you for more than your billed amount, even though their allowed amount for that service may be higher than what you billed.
When you are setting the new fee schedule, keep in mind:
- Practice expenses
- Geographic location
- Fee schedules of similar practices in your area.
Most practices serve patients that do not have health insurance, so these patients would be paying out of pocket. By setting your fees too high, you could potentially lose some of your self-pay patients to other practices in your area with a lower fee schedule.
When performing a fee schedule analysis for practice purchased medications and supplies, there are items to consider. Are the insurance carriers’ allowed amounts lower than what it is costing the practice to purchase a particular medication or supply? If it costs the practice $100.00 a dose to purchase a particular medication for a patient, but the insurance payers are only allowing or paying $50-$60 a dose, the practice is taking a financial loss every time they supply that medication to a patient. If you are seeing this scenario when evaluating your fee analysis reports, you may want to look at a different vendor to purchase the medication through. Take into consideration the patient’s pharmacy benefits, with a physician’s order, is the patient able to obtain the medication at their pharmacy?
By completing a fee schedule comparison and evaluating your fees on an annual basis, you could save your practice thousands of dollars of potential lost revenue.