10 Things You Should Know About the Medicare Payment Data Release

Last week, CMS released a report summarizing the Medicare billing data for physicians across the country. Doctors panicked and patients attempted to understand what all these steep numbers meant, meanwhile buzz terms like “healthcare price transparency” and “reimbursement rates” flew around with more aggressive velocity than ever before.

For those that are unsure what this billing report really means, we’ve given you a breakdown. Read on to learn everything you need to know about this release.

1.     The report shows which physician specialists are getting paid the most and approximately how much they are receiving from CMS.

2.     So what are these payments supposed to cover? Medicare fees are supposed to cover the physician’s actual work, overhead costs for their equipment, malpractice insurance and other costs. What are those “other” costs though?

3.     It shows amounts paid but doesn’t delineate where specialties with high overhead costs come into play. For example, Radiation Oncologists incur significant overhead costs to provide their specialized services, so they get reimbursed much more to cover those costs.

Information provided by The Wall Street Journal. Source: Centers for Medicare and Medicaid Services

4.     There are tons of dollar amounts being shown, but the figures do not correlate to patient levels or success rates, so the impact of the costs cannot be easily determined.

5.     The report was supposed to help catch Medicare fraud activity, but it doesn’t do this very effectively. This is because it lumps a lot of physicians into groups regardless of outside factors like overhead costs.

6.     The goal of displaying this data was that exposure would change overall behavior.

7.     The database does not break out payments by PC and TC. Rather, they are aggregated, explaining why the numbers seen in the Wall Street Journal article are so steep.

8.     Separate from the aggregated data, there is also a larger dataset of information which is HUGE and includes the following information for each physician in the country:

·         Average charge/CPT code

·         Number submitted/CPT code

·         Average amount per procedure code

·         Billing addresses of physicians

·         Procedure performed in a “facility” or “non-facility”

·         POS codes for procedures

9.     This dataset file is too big for Excel, but if you link the text file to Access you can use it.   We learned via the RBMA chatter, that some have had success this way, saying, “Once I got a query result I used Excel to manipulate and analyze the data.” Keep this in mind if you’re looking for a way to sort the data yourself.

10. This big number: $121 million. As in, the sum of what the top 10 physician billers charged for Medicare in 2012.

Important links for learning more:

Dataset:

http://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/Medicare-Provider-Charge-Data/Physician-and-Other-Supplier.html

WSJ Article:

http://online.wsj.com/news/article_email/SB10001424052702303873604579492012568434456-lMyQjAxMTA0MDEwMTExNDEyWj

WonkBlog Summary of Physician Responses:

http://www.washingtonpost.com/blogs/wonkblog/wp/2014/04/10/wonkbook-why-doctors-are-upset-about-the-medicare-payment-data-release/

What Healthcare Pros Need to Know About Radiologists

By: Matthew D, Rifkin, MD, FACR

In the past, the radiology profession was seen as a very financially successful specialty, but as every businessperson knows, success often has peaks and valleys.  Radiology residencies are some of the most competitive to obtain, which is due to the combination of expected financial compensation and the assumed quality of life. 

In the early 1990’s, when financial pressures first appeared on the frontier of radiology, RAPS suggested that hospital based physicians divvy up a portion of their financial pie. It was during that time, and again in the early 2000s, that radiology began to see a dip in American graduates showing interest in the field. The nice 9-to-5 lifestyle and never being on call started to fade away, making the stress associated with radiologists lives become more apparent.

Compensation for practicing also started to become severely affected, this applies to both hospital based radiologists and independent imaging center radiologists. Hospitals used to pay a generous stipend to their radiologists, however they are now facing increased financial pressures such as the shutting down of hospitals, emergency room patients being cared for without paying and harsh Medicare cuts.  With all of these stressors, hospitals are additionally requiring 24-hour coverage by radiologists to account for better patient care, while teleradiology services seem to have undercut most hospital based radiologists.

Challenges associated with pre-certifications, decreased reimbursement, decreased referrals due to radiation fears and self-referrals have also been contributing factors to decreased compensation, but more importantly, those radiologists’ morale has begun to suffer. Particularly in the case of outpatient imaging centers, where income reductions in some areas have been as much as 50-75%.

Radiologists are working longer hours and taking less vacation time, which seems miniscule, except that you must take into account the fact that this was unheard of in years past. These same radiologists are now delaying retirement, which leads to the delay of hiring new, younger radiologists. In the cases where positions are offered, the starting salaries in some states have been reduced by as much as 40%. Of course in certain areas of the country, like New York City, this is more threatening and prevalent.

 It is hard to look at healthcare in our country and understand where our problems start and where they end, but as healthcare professionals, it is necessary to take a step back and examine these changes from the care providers’ perspectives. It will help us determine where we are, how far we have come and what next frontier we will conquer. 

The 5 Myths of Self-Pay

Whether you’re a patient or a health care provider, it is likely that you have heard the myths about the self-pay process.  In the past, health care providers have referred to self-pay patients as “no-payers” due to the stigma associated with them that their fees go uncollected.  Trends towards transparency in the health care system, the rise in uninsured patients and resources springing up to serve as reference points for quality, affordable care have started to clear up the myths that exist.

After speaking with a number of physicians and patients across the country, we have assimilated this list of myths, and will address each falsehood:

1. The only way to get quality care is through an insurance plan and services are too expensive without insurance.
2. Providers cannot charge less than Medicare for services.
3. Third-Party Payers will renegotiate contracts depending on a practice’s discounted cash-pay prices.
4. There is no efficient way to collect self-pay payments.
5. People without insurance are ill educated when it comes to health care pricing and quality.

1. The only way to get quality care is through an insurance plan and services are too expensive without insurance.

As long as patients know where to look, they can find highly reputable providers with affordable pricing options.  Uninsured patients can also negotiate pricing in many instances.  Keep in mind that high quality care does not necessarily translate to lack of affordability.  There is very little correlation when it comes to quality and pricing in the health care system; just because a location charges $1400 for an MRI, does not mean it is better than the facility charging $450.

2. Providers cannot charge less than Medicare for services.

There is no existing prohibition for offering a discount to uninsured or underinsured self-pay patients.  The CMS (Center for Medicare Services) has stated that discounts, when based on financial situations, are not considered kickbacks, and thus they do not violate any existing laws or regulations.

3. Third-Party Payers will renegotiate contracts depending on a practice’s discounted cash-pay prices.

Providers are expected to have “reasonable and customary” charges, which are established based on the cost of providing the service.  That amount is what is billed to all payers, including self-pay patients.  In most cases, insurance providers contract with medical offices a discount off of the charges. Often times however, the self-pay prices are simply a reflection of a practice’s Medicare Fee Schedule.  As with Medicare, providers can offer discounts based on financial situations. This should not alter the reasonable and customary charge based on costs, or the amount a payer is willing to pay by contract.

4. There is no efficient way to collect self-pay payments.

In the past, physicians rarely saw full collections on self-pay payments because of ineffective processes.  Practices spent an extraordinary amount of time and money chasing down lost payments, looking backwards instead of forwards.  Self-pay collections will improve with transparency and by collecting the payment before or at the time the procedure is performed.

5. People without insurance are ill educated when it comes to health care pricing and quality.

Gone are the days when being uninsured meant you were unprepared, unemployed or uneducated.  Employers adopting consumer-based health plans and high-deductible health plans have led Americans to realize that acquiring care on a cash-pay basis and price shopping is oftentimes more economical for their families.  This being said, 32% of patients are actively price shopping for care. We have learned that in most cases, these uninsured patients are typically the most knowledgeable of pricing, quality and the health care system as a whole.

Tags: self-pay, uninsured patients, cash pay, price shopping, self pay, no pay, high-deductible health plans, medicare fee schedule, CMS

The Rise of Health Care Compliance Programs

The Patient Protection and Affordable Care Act (PPACA) requires health care providers to enroll in a federally mandated health care plan and to adopt a health care compliance plan. Section 6401 of PPACA states that health care providers must establish a compliance program that contains certain core elements as a condition of enrollment. 

Compliance programs became popular in the early 1990’s when professionals in the health care industry were in need of a strategic and systematic way for companies to deal with misconduct and fraudulent activity.  The purpose of these compliance programs was to serve as a “mitigating factor in sentencing.”  Essentially, it set in place standards for health care providers to follow, so that when misconduct was detected, penalties and reductions by the government could be justified, providing a level playing field for all in the industry. The Office of the Inspector General (OIG) began to require compliance programs in investigations of Medicare fraud, which sparked the voluntary adoption of compliance programs by more health care providers.

The PPACA of course now requires most providers to adopt such plans by 2012, however the core elements of requirement have not yet been defined by regulation and will be different for each type of provider. Therefore, health care providers currently without compliance plans are working to draft and implement programs reflective of old guidelines. 

This is because fraud enforcement has increased and compliance plans will help to reduce or even avoid penalties for violations. The OIG’s Work Plan indicates a greater need for compliance in areas such as claims accuracy and provider training, suggesting these as areas of increased focus in future plan guidelines. Although the regulations haven’t yet defined the future core elements for compliance plans, previously issued materials help providers prepare for what’s next.

In the past, the following elements were typical of acceptable compliance programs:

 

• Establishment of written compliance policies and procedures and distribution to employees.
• Designation of a specific individual or individuals to monitor compliance like a compliance officer.
• Commitment to conducting formal training and education programs.
• Development of internal system for communication of suspected compliance violations.
• Commitment to auditing and monitoring to evaluate compliance and identify potential problematic areas.
• Maintenance of disciplinary policies, which are consistently enforced.
• Development of process for investigation of suspected violations and reporting to the government and law enforcement authorities when necessary.

These elements should likely be helpful to providers without compliance programs in place, to use in drafting plans for the future, allowing for practices to be proactive about changes.  This will allow practices, hospitals and care providers to communicate their culture and standards of ethics to their staff and patients in addition to the ability to provide a sense of transparency into the standards of practice operations.

Radiologists Use Healthcare Marketing to Combat Industry Challenges

In the same way that the consumer industry turns to marketing and public relations to combat industry challenges and vie with competition for consumer spotlight, the healthcare industry uses marketing to attract new patients.  Healthcare reform and tendencies towards healthcare transparency in addition to Medicare changes in regards to reimbursement have created a unique challenge for providers, but have influenced radiologists in more ways than one. Of course, providers can’t compete like Macs and PCs can, but think of independent radiologists as a Mac with more personalized settings, creative and unique methods and less stress.

The issues radiologists face on a daily basis include overutilization for services as a result of other specialists taking advantage of self-referral capabilities, decreased reimbursement from Medicare and the commoditization of diagnostic imaging due to vast pricing disparities’ and the misconception that patients cannot afford quality care.  These challenges of course have led to decreased confidence among radiologists and desperate attempts to stay afloat.  Some in the industry believe that the only solution is to join an Accountable Care Organization or to be bought out by a hospital, succumbing to the pressures of change without any effort to transform the way they do business.  Through a series of solutions to improve performance, manage change and find success, efforts can be made to bring practices into the future of healthcare by being proactive and positioning themselves for success.

The issue of over-utilization in reference to diagnostic imaging procedures in our country would be eliminated if self-referral patterns were less prominent.  The solution is for radiologists to focus on marketing the strengths of patients going to independent outpatient imaging facilities over other options that are unable to focus on just radiology. These strengths are accreditations, on-site radiologists, more intricate and specialized capabilities, personalized service and affordable pricing for patients.  Through physician outreach and networking with specialists and general care providers, radiologists can also show referring physicians the multitude of benefits of working together.  Incorporating a marketing professional who aims to build referral relations and new patient volume can also help rebrand the outlook of your whole practice.

No practice can truly combat decreased reimbursement, but they can take steps to make sure that there are as few mistakes as possible and expedite the collections process.  By having a well-equipped billing and coding department, practices can capitalize on time and money spent.  By maintaining control by recruiting the help of professionals, your practice can focus on the important aspects of care.

Radiologists, all healthcare providers in fact, are in the industry to provide care to those in need, which is why the commoditization of care is every provider’s worst nightmare.  The solution is price transparency in healthcare.  By being a resource to patients and providing them with facts on their procedures and giving clear invoices and pricing up front will show patients that they can in fact receive the care they need at costs they can afford.  Of course, transparency will only be affective when melded with proof of quality, so if all providers hold their practices to a standard of excellence, patients will be able to truly see the disparities in the healthcare pricing industry.  Creating strategies to capitalize on this price-sensitive patient market is crucial to staying afloat in the tragic healthcare economy we find ourselves in.