Should Your ASC Outsource Billing & Coding?

For some practices, it's an excellent alternative.

BY CARYL A. SERBIN, RN, BSN, LHRM

In today's difficult economy, why should you consider spending additional money to give your most precious asset to an outsider? Before you determine that outsourcing your ASC's coding and billing is not for you, take a moment to read more about it. You can then make an informed decision on whether outsourcing might be the right choice for your center.

If you are planning to build an ASC, evaluate outsourcing your billing while you are still in the design phase. You may be able to save on square footage and the amount of business office employees needed. Even if you are already building your surgery center, look at how you might be able to reassign some of the business office area into revenue-generating clinical space.

In existing surgery centers, the idea of outsourcing is often met with resistance by physician-owners and administrators who feel that outsourcing billing is not a positive choice, i.e.:

"My billing staff is doing a good job."

"It costs too much."

"I need to be in control."

"Change is bad!"

Consider Your Options

If you have a great coding and billing staff, count your lucky stars and throw this article out the window!

However, if you feel your coding and billing are less than stellar, you may want to consider the following when evaluating how to improve your center's financial performance. There are several reasons why your ASC may not be collecting all that you can.

► Lack of experienced coding may lead to leaving fees on the table. This is not about unbundling or fraud; this is about being able to interpret the operative note and charge for all allowable procedures while remaining compliant.

► What about implants? Are they being billed properly and collected fully? Particularly in ophthalmology, with all of the different IOLs now available, does your billing staff understand the difference in lenses, as well as their different reimbursement allowances — regular lenses, presbyopic lenses, toric lenses, etc? Even though there may only be a $50 additional reimbursement, these can add up quickly in a busy ophthalmology center.

► Does your staff understand that you are able to charge additional fees for handling and shipping lenses?

► Are they charging the full invoice amount for the shipping and handling of corneas from the eye bank?

► If you have or are adding retinal cases to your center, these are complex and often have several procedures codes in a single case — are you receiving reimbursement for all that you perform?

A Billing Service Can Add Value

Now let's dispel the "costs too much" myth. If a billing company charges you 5% of collections and you can eliminate the following expenses, which do you think is more cost-saving?

► Depending on the size of your center and the amount of business office employees, determine what salaries could be eliminated if your billing were to be done off-site.

► Take into account associated costs that would decrease, such as employee benefits, computers, furniture, supplies, clearinghouse fees, postage for statements and business office space (maybe you can convert some of the regained space into clinical space).

► What if you could increase your gross revenue by 5%? How much profit would that add to the practice's bottom line?

► What if you could decrease your days in A/R by five days? What does that mean to your bottom line?

► Consider less measurable savings such as eliminating patient phone calls about statements, chasing denied claims to the highest level of adjudication (does your current collector do that?) and preparing lengthy deposits and taking them to the bank. Difficult to quantify financially, these cost the practice in terms of productivity.

Outsourcing and Financial Control

Next, let's discuss the control issue. If you are the one having to answer to the Board, it is only natural that you want to control your own destiny. However, a good billing company allows you to be involved and in control — you just don't have to do the day-to-day work.

If a billing company is accessing your ASC's software via an encrypted network, then you have real-time access to all of their work 24/7. All reports are current. If you have questions, the answers are only an e-mail or phone call away. It's just like looking over their shoulder electronically. Also, there should be regular communication, including weekly reports and phone calls and daily communication with your staff from a dedicated team leader and liaison for your center.

Change Can Be Good

If either one of the following reasons apply or appeal to you, it may help you in rethinking your ideas on outsourcing.

■ Many surgery centers cannot afford or do not have access to certified, experienced coding and billing staff. A billing company's staff is their major investment, so they work to attract the best and the brightest and pay them top salaries in order to ensure optimization, accuracy and compliance. These are the people that will be working for your center.

■ If your surgery center has ever had a key member of their coding or billing staff leave (or even temporarily be gone like illness or vacation), you understand the disruption that occurs. Coding/billing does not get done regularly, if at all. Revenue dips; owners are upset. Billing companies have employees and supervisors who are able to fill in for sick or vacationing staff and your center will not even notice a slight hiccup. In today's climate of increased and ever-changing HIPAA and compliance regulations, peace of mind comes from knowing that your billing company is up-to-date and processing your coding and billing with a focus on optimizing your revenue while keeping your center compliant.

What to Look for in a Service

We've all heard horror tales about billing companies gone wrong, especially those involved in practice management in the '80s and '90s. However, contrary to what you may have heard about billing companies, they are not all alike. That�s why it's so important that you know what to look for when researching companies for outsourcing.

The key elements that distinguish a first-rate billing company include reputation, longevity, experience in billing for your ASC's specialties and, most important, positive references from industry leaders, associations and clients.

Reputable billing companies welcome the chance to show you how they are run, what they offer and why they are the best company to choose. Ask them to provide you with a list of services in addition to the expected tasks below:

► coding by a certified coder

► claims submitted within 24 to 48 hours after receipt of necessary billing information

► oversight of claims processing through the clearinghouse and verification of receipt by payer

► collection activity that begins within 15 days of submission and continues regularly thereafter

► payment posting done within 24 hours of receipt of payment

► evaluation of denials for no payment or underpayment started immediately

Do they also:

► assist the center with fee schedule development or changes?

► educate the ASC staff regarding upcoming changes, i.e., CMS reimbursement?

► advise the center when managed care contracts may need to be renegotiated?

► provide special reports when needed?

► do state reporting where required?

► provide duplicate off-site storage of data in case of disaster?

► have experienced IT staff?

Be sure to do your homework thoroughly before making a final decision. Consider visiting the billing company offices. You can learn a lot about a company by meeting their staff. Don't overlook all of the advantages of off-site billing. In today's digital world, your coders and billers are only a keyboard-click away. OM

Practices Look to Outsourcing

By Jerry Helzner, Senior Editor

Like many businesses of all types, ophthalmology practices seeking cost-effective operation are opting to focus on what they do best — in this case, patient care — while outsourcing more and more ancillary tasks to third parties. In addition to the billing and coding described in the accompanying article, some practices are now choosing to outsource in such key areas as marketing, ASC operation and even audiology services.

With cataract surgery viewed as a dependable revenue source for the foreseeable future, some practices that don't want to make the considerable investment required for a surgery center are joining together to share a facility, usually in conjunction with a hospital.

The surgeons must first agree on how to equip the facility, as the same phaco machines and microscopes are usually used by all of the surgeons. The day-to-day servicing of the facility can be outsourced to a national firm that provides all of the equipment and supplies, plus a tech who assists in surgery. Normally, under this arrangement the outsourcing company receives a fixed fee for each case.

Clarence Tam, MD, of the Marshfield Clinic in Marshfield, Wisc., has been performing cataract surgery in a Marshfield Clinic-managed shared facility serviced by Sightpath Medical for the past four years.

Initially, he says, the surgeons got together and voted by majority rule to use one phaco machine exclusively. When he expressed interest in using a different system, he explains, "Sightpath said that they would work with me." There is some give and take when additional expense is involved, but he finds Sightpath to be flexible in terms of providing the surgeons with new technology. "If we had an ASC where we owned the equipment versus outsourcing, I would be limited to using one phaco machine," Dr. Tam says, "so this arrangement gives us more options."

When Florida-based Ocala Eye made the decision to add a hearing center, the practice was able to partner with a company that had expertise in this specialty.

"We helped develop the model in cooperation with Physician Hearing Services, Inc.," says Peter Polack, MD, of Ocala Eye. "They help to recruit a certified hearing specialist, or audiologist if you prefer, and give you a short list of candidates to interview. They also help set up the diagnostic equipment which, to our surprise, did not require a fancy, expensive soundproof chamber but merely a room that is in a quiet part of your office."

Physician Hearing Services (www.phsimd.com) uses their connections in the hearing aid industry to get competitive costs on the devices and have access to the latest technology. By providing this turnkey approach, Physician Hearing Services has grown to include more than 45 ophthalmology practices.