How to Set a Medical Fee Schedule Without Leaving Money On the Table
Chicago, IL (PRWEB) March 29, 2014 -- Carefully consider how the physician’s practice defines the value of its services. Setting a medical fee schedule is the backbone of the revenue stream for a medical practice. Unlike most markets in the United States, the health care market generally lacks uniformity. To cover the operation costs the practice needs to structure service offerings that have a higher reimbursement rate from the insurance companies. Medorizon helps medical practices revise their treatment practices to offset fee schedule-related revenue losses. Medicare’s fee schedules are determined by the US Government. Their fee schedule is established by calculating the amount of time and work put in for a particular procedure, as well as costs for maintaining the practice, they then times that by a conversion factor which will calculate the payment amount based upon geographical location. Medorizon has also helped negotiate contracted fee schedules with payors located all over the country.
When setting up or updating a fee schedule all contracted fee schedules, local workmen’s compensation, and personal injury fee schedules are taken into the account. What this means is if you charge less than what a payer is willing to pay then your fee schedule is too low. There is a signed contract in which agreement is made to accept the insurance’s allowed amounts as payment in full; therefore, contractual adjustments will have to be appended to the service. The contract adjustment is the difference between the doctor’s billed amount and the insurance’s allowed (or contracted) amount. This will become clearer when reading the explanation of benefits. When negotiating contracts with insurance companies the most important thing to recognize is that most of all plans are based on Medicare rules and regulations.
Keeping fees consistent and reasonable helps the company to understand how much of account receivables are collectible. The problem with a high fee schedule is patients without insurance will have trouble affording the cost for their services rendered. As well it can be considered unreasonable and spark an insurance audit. “A good fee schedule should reflect prices regarding both the individual services and the consequences of not receiving payment on other disputed services. Typically Pain Management and Orthopedics have to take this into account because of the legal payment mix.” Says Keith Tobin; Vice President of Medorizon.
Key points to focus on would be to:
1. Be consistent
2. Increase you fees annually
3. Set fees high enough to cover increase allowable
Some services are divided into components or pieces based on who is responsible for which part of a service. The final variable to take into account is the use of modifiers. The modifier 26 indicates “professional component” TC modifier “technical component” (59021, 59021-TC and 59202-26) the code without the modifier pays the highest amount. This is because the payor will be paying another party for parts of the service.
For many medical practices, providing quality services to patients is easy—processing claims and getting reimbursement is the tedious part. Medorizon has grown to a 60-employee organization, reaching sales of several million dollars annually. Their staff manages the billing and collection process for hundreds of providers throughout the United States. Act now and take advantage of the offer to better acquaint your practice with the initial changes in moving forward to ICD-10.
Call: 800.843.0355 Or Please visit us at: http://www.medorizon.com
Keith Tobin, Medorizon, http://www.medorizon.com, +1 (815) 834-7225, [email protected]
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