Money Your Practice May Be Throwing Away

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Money Your Practice May Be Throwing Away

  1. 1. How To Reclaim Money Your Practice May Be Throwing Away The Cost of Inadequate Documentation and Incorrect Coding e-medtools.com
  2. 2. Basic Premises <ul><li>Most physicians </li></ul><ul><li>Are not practicing medicine “for the money!” </li></ul><ul><li>Are competent, compassionate doctors </li></ul><ul><li>Enjoy helping others </li></ul><ul><li>Work long, hard, often thankless hours </li></ul><ul><li>Deserve the money they earn! </li></ul>
  3. 3. Stressors Physicians Experience <ul><li>Rising clinic practice costs </li></ul><ul><ul><li>Generally 40-60% of a physician’s revenue </li></ul></ul><ul><ul><li>Practice costs expected to increase 20% in 2008 </li></ul></ul><ul><li>Decreased reimbursement from insurance companies </li></ul><ul><li>Increasingly complex medical field </li></ul><ul><li>Increased requirements and cost for maintaining licensure </li></ul><ul><li>Increased pressure to improve quality without compensation </li></ul><ul><li>Exorbitant, rising medical liability costs and jury awards </li></ul><ul><li>Increasing violence directed at healthcare workers </li></ul><ul><ul><li>28% of ED physicians are assaulted each year </li></ul></ul><ul><ul><ul><li>Annals of Emergency Medicine 2005 46(2):142-7 </li></ul></ul></ul>
  4. 4. Additional Stressors <ul><li>Unrealistic expectations from the general public, legislators, lawyers, and insurance companies </li></ul><ul><li>Idealistic, virtually perfect performance from physicians </li></ul><ul><ul><li>Quality is an unfunded mandate! </li></ul></ul><ul><li>Essentially free medical care is a “moral imperative” </li></ul><ul><ul><li>(Hillary Clinton’s, 2008 Presidential Candidate, address to George Washington University Medical News Today May 2007) </li></ul></ul><ul><li>Healthcare providers will bear the cost of public health </li></ul><ul><ul><li>Emergency departments must treat all people who walk through their doors regardless of ability to pay </li></ul></ul><ul><ul><li>Hospitals require that doctors be on call for the emergency department in order to have the privilege of working at that hospital </li></ul></ul><ul><ul><ul><li>Doctors must then see patients who cannot pay for their care </li></ul></ul></ul>
  5. 5. There is No Free Lunch <ul><li>Food, Shelter, Clothing and Healthcare </li></ul><ul><li>Should the government provide these for free? </li></ul><ul><li> Should businesses be required to provide these for free? </li></ul><ul><li>Why should doctors provide free healthcare? </li></ul>
  6. 6. What Physicians Already Do <ul><li>“ Physicians are an important source of healthcare for many uninsured and underinsured patients, as evidenced by the fact that a physician’s office is the usual source of care for about one third of uninsured persons, and physician uncompensated care costs were estimated as high as $11 billion in 1994” Managed Care and Physicians’ Provision of Charity Care JAMA 1999 281:1087-1092 </li></ul><ul><li>Physician Survey (American Medical News 2006) </li></ul><ul><li>76% of physicians provided free or low cost healthcare in 1996-97 </li></ul><ul><li>68% of physicians provided free or low cost healthcare in 2004-2005 </li></ul><ul><li>Physicians spent 10.6 hours/week providing uncompensated care! </li></ul><ul><li>“ A Growing Hole in the Safety Net: Physician Charity Care Declines Again” Center for Studying Health System Change 2006 </li></ul>
  7. 7. Impact of Physician Stressors <ul><li>Medical practices are BUSINESSES! </li></ul><ul><ul><li>A business is not sustainable unless income exceeds expenses </li></ul></ul><ul><ul><li>Unlike most businesses, medical practices (physicians) are legally restricted in setting fees for services </li></ul></ul><ul><li>Reimbursement for physician services are decreasing, therefore physicians must </li></ul><ul><ul><li>See more patients to sustain the medical practice </li></ul></ul><ul><ul><li>Spend less time with individual patients in order to see more patients </li></ul></ul><ul><li>The consequences of an increased workload can result in </li></ul><ul><ul><li>An increased likelihood of missing problems </li></ul></ul><ul><ul><li>Decreased patient satisfaction </li></ul></ul><ul><ul><li>A significant drop in physician job satisfaction </li></ul></ul><ul><ul><li>Hastened “burnout” </li></ul></ul>
  8. 8. To Err Is Human . . . But Don’t Err On Insurance Documentation! <ul><li>Incorrect billing for the documentation provided </li></ul><ul><li>Regardless of the complexity, lack of clarity, and unending changes made to the system IS ASSUMED TO BE FRAUD! </li></ul><ul><li>And can turn a doctor </li></ul><ul><li>into a criminal! </li></ul>In less time than it takes to receive payment from the Centers for Medicare and Medicaid!
  9. 9. The Injustice <ul><li>Demands from insurance companies are increasing </li></ul><ul><li>-more paperwork, denial hassles, phone calls, audits, etc. </li></ul><ul><li>Meanwhile </li></ul><ul><li>Physician practice costs have </li></ul><ul><li>increased by 20% since 2001 (AMA) </li></ul><ul><li>Health insurance costs have nearly doubled </li></ul><ul><li>Yet insurance companies are reducing reimbursement to physicians! </li></ul><ul><ul><li>By 2013 it is predicted that Medicare reimbursement will be 50% of the reimbursement seen in 1991! (Vital Signs March 2005) </li></ul></ul><ul><ul><li>2008 Medicare cuts will average 9.9% (AMA) </li></ul></ul><ul><ul><li>5% cuts are planned for 2009 (AMA News, Aug 2007) </li></ul></ul>
  10. 10. How Can Physicians Afford To Work? <ul><li>Give up coveted independence in favor of employed positions?! </li></ul><ul><li>Stop seeing Medicare and Medicaid patients?! (MMWR 56(10);230) </li></ul><ul><ul><li>In 2004 20% of physicians no longer accepted Medicare patients </li></ul></ul><ul><ul><li>9.3% no longer accepted Medicaid </li></ul></ul><ul><ul><li>60% of physicians interviewed in 2007 by the AMA state that they will limit the number of new Medicare patients as a result of aggressive, proposed cuts to physician reimbursement (AMA) </li></ul></ul><ul><li>Surviving requires understanding AND playing the insurance game! </li></ul><ul><li>Maximize reimbursement through </li></ul><ul><ul><li>Adequate and thorough documentation </li></ul></ul><ul><ul><li>Appropriate Coding </li></ul></ul><ul><ul><li>Get Paid For The Work You Do! </li></ul></ul>
  11. 11. Many Physicians Under Code! <ul><li>Most physicians do more work than their documentation supports! </li></ul><ul><ul><li>And, as the saying goes, </li></ul></ul><ul><ul><li>if it isn’t documented, it didn’t happen! </li></ul></ul><ul><li>Fear of fines and loss of licensure have forced physicians into under-coding! </li></ul>
  12. 12. How Much Is At Stake? <ul><li>33-52% of patient encounters are under coded </li></ul><ul><ul><li>(JABFP 2001;14:184-92 and FPM October 2003 “How to get all the 99214s you deserve”) </li></ul></ul><ul><li>Assumptions </li></ul><ul><ul><li>$30 difference in reimbursement (99213 to a 99214) </li></ul></ul><ul><ul><li>30 patients per day </li></ul></ul><ul><ul><li>= lose ~$300 per day! </li></ul></ul><ul><ul><li>[33%(30 patients/day) x $30/patient = $300/day] </li></ul></ul><ul><li>For a physician working 5 days/week for 50 weeks, that is $75,000 annually per physician!!! </li></ul><ul><ul><li>That’s no small chunk of change! </li></ul></ul>
  13. 13. What Is The Gain? <ul><li>Decreasing billing and coding errors by just 50% could mean an increase of nearly $40,000 per year in practice revenues! </li></ul><ul><ul><ul><li>The equivalent of seeing an additional 690 (99213) patients/year </li></ul></ul></ul><ul><ul><ul><li>Or, an extra 3 patients/day! </li></ul></ul></ul><ul><ul><ul><li>WITHOUT THE EXTRA WORK! </li></ul></ul></ul><ul><ul><ul><li>$40,000 per year / $58 per patient = 690 patients per year </li></ul></ul></ul><ul><ul><ul><li>690 patients per year / 250 work days per year ~ 3 patients per day </li></ul></ul></ul><ul><li>Put another way . . . </li></ul><ul><li>Losing $300 per day is like seeing nearly 3 new patients per day for free! </li></ul><ul><li>($90 per each 99203 new patient) </li></ul><ul><li>This won’t make physicians rich! </li></ul><ul><li>This merely decreases the impact of ongoing losses </li></ul><ul><li>due to decreasing reimbursement and shifting healthcare costs! </li></ul>
  14. 14. Tools to Improve Documentation <ul><li>Electronic Medical Records (EMRs) </li></ul><ul><ul><li>Electronic medical records are available, but are often cost-prohibitive </li></ul></ul><ul><li>Standardized forms </li></ul><ul><ul><li>Proven to improve documentation </li></ul></ul><ul><ul><li>Less expensive </li></ul></ul><ul><ul><li>Most are designed to be completed by hand and kept in a paper chart </li></ul></ul><ul><ul><li>Many are specific for particular complaints </li></ul></ul><ul><ul><ul><li>such as cough, sore throat, etc., </li></ul></ul></ul><ul><ul><ul><li>yet lack the scope needed to address multiple comorbidities </li></ul></ul></ul><ul><ul><li>Few contain reminders </li></ul></ul><ul><ul><ul><li>Physician Quality Reporting Initiatives </li></ul></ul></ul><ul><ul><ul><li>Risk of excessive alcohol intake </li></ul></ul></ul><ul><ul><ul><li>Severity index scoring, etc. </li></ul></ul></ul>
  15. 15. Electronic Medical Records <ul><li>In 2004 President Bush created the Office of the National Coordinator for Health Information Technology whose mission is to </li></ul><ul><ul><li>“ Implement an interoperable health information technology infrastructure nationwide” </li></ul></ul><ul><li>System costs </li></ul><ul><ul><li>Software, hardware, training, implementation, ongoing maintenance and support </li></ul></ul><ul><li>Induced costs </li></ul><ul><ul><li>Costs involved in the transition to an electronic medical record, such as the temporary decrease of productivity </li></ul></ul><ul><ul><li>A Cost Benefit Analysis of Electronic Medical Records in Primary Care The American Journal of Medicine 2003 114(5):397-403 </li></ul></ul><ul><ul><li>E-Health 101:Electronic Medical Records Reduce costs, Improve care, and Save lives American Electronics Association 2006 </li></ul></ul>
  16. 16. Electronic Medical Records Capabilities May Include* <ul><li>Viewing </li></ul><ul><ul><li>Medical notes, labs, reports, formularies </li></ul></ul><ul><li>Documenting </li></ul><ul><ul><li>Medical notes, labs, reports </li></ul></ul><ul><li>Ordering </li></ul><ul><ul><li>Prescriptions, labs, tests, consults, durable medical equipment </li></ul></ul><ul><li>Messaging </li></ul><ul><ul><li>Physician-Staff; Physician-Physician; Physician-Patient and vice versa </li></ul></ul><ul><li>Care Management/Follow up </li></ul><ul><li>Analysis and Reporting </li></ul><ul><ul><li>Adverse drug reactions, drug-drug reactions, chronic disease reminders, preventive care reminders, statistical analysis </li></ul></ul><ul><li>Patient-directed </li></ul><ul><li>Billing and Scheduling </li></ul><ul><li>* All capabilities are not available for all EMR systems </li></ul>
  17. 17. Who Uses Electronic Medical Records? <ul><li>~ 25% of office-based physicians used some form of EMR in 2005 </li></ul>National Center for Health Statistics National Ambulatory Medical Care Survey
  18. 18. Implementing Electronic Medical Records <ul><li>$2,500 - $44,000 initial start-up cost/provider </li></ul><ul><ul><li>Software </li></ul></ul><ul><ul><ul><li>50-200% of initial costs </li></ul></ul></ul><ul><ul><li>Hardware </li></ul></ul><ul><ul><ul><li>$5,000-10,000/provider </li></ul></ul></ul><ul><ul><li>Implementation </li></ul></ul><ul><ul><ul><li>$3400/provider </li></ul></ul></ul><ul><ul><li>Additional maintenance costs </li></ul></ul><ul><ul><ul><li>$700-1500/provider per month </li></ul></ul></ul><ul><ul><ul><li>Providers include MD, NP, RN, LPN, PA, MA, receptionist </li></ul></ul></ul><ul><li>Lost productivity estimated at >$10,000 in the first year </li></ul><ul><li>Average time to return on investment is 2.5 years </li></ul><ul><ul><li>This makes electronic medical records unobtainable by most medical practices </li></ul></ul>The Value of Electronic Health Records in Solo or Small Group Practices Health Affairs 2005 24(5):1127-1137 A Cost Benefit Analysis of Electronic Medical Records in Primary Care The American Journal of Medicine 2003 114(5):397-403 Electronic Medical Records Systems Cost Effective, Study Shows Medical News Today 2007
  19. 19. Benefits of Electronic Medical Records <ul><li>Improved documentation </li></ul><ul><li>Reduce paper chart pulls </li></ul><ul><ul><li>Estimated to cost $5/chart </li></ul></ul><ul><li>Decrease costs for transcription </li></ul><ul><li>Reduce redundant labs and tests ordered </li></ul><ul><li>Some provide prompters </li></ul><ul><ul><li>Preventive care </li></ul></ul><ul><ul><li>Medication options </li></ul></ul><ul><ul><li>Adverse drug interactions </li></ul></ul>A Cost Benefit Analysis of Electronic Medical Records in Primary Care The American Journal of Medicine 2003 114(5):397-403
  20. 20. Financial Benefits of EMRs <ul><li>5-year net BENEFIT of a “full EMR” </li></ul><ul><ul><li>$86,000/provider </li></ul></ul><ul><ul><li>Full EMR includes electronic prescriptions, chronic disease reminders, drug interactions, and preventive care prompters </li></ul></ul><ul><li>5-year net COST of a “light EMR” </li></ul><ul><ul><li>$18,000/provider </li></ul></ul><ul><ul><li>used only to reduce paper chart pulls and transcription costs </li></ul></ul>A Cost Benefit Analysis of Electronic Medical Records in Primary Care The American Journal of Medicine 2003 114(5):397-403
  21. 21. MedicalTemplates <ul><li>Standardized patient encounter forms </li></ul><ul><li>Adobe PDF Technology </li></ul><ul><ul><li>Use as a paper form OR </li></ul></ul><ul><ul><li>Use as an electronic form </li></ul></ul>
  22. 22. MedicalTemplates Features <ul><li>Documentation prompters </li></ul><ul><ul><li>HCFA 1997 documentation guidelines </li></ul></ul><ul><li>Quality reminders </li></ul><ul><ul><li>Medicare PQRI </li></ul></ul><ul><li>Checkboxes </li></ul><ul><ul><li>Save time </li></ul></ul><ul><ul><li>Save energy </li></ul></ul><ul><ul><li>Time is Money </li></ul></ul>
  23. 23. Implementing MedicalTemplates <ul><li>Required Hardware and Software </li></ul><ul><ul><li>Free Adobe Reader from Adobe.com </li></ul></ul><ul><ul><li>Basic computer ($350 or less) </li></ul></ul><ul><ul><ul><li>Intel Pentium III or better for Windows </li></ul></ul></ul><ul><ul><ul><li>PowerPC G3 or better for MacOS </li></ul></ul></ul><ul><ul><li>One or more MedicalTemplates </li></ul></ul><ul><ul><ul><li>$150 per template </li></ul></ul></ul>
  24. 24. MedicalTemplate Benefits <ul><li>Inexpensive implementation </li></ul><ul><li>Minimal learning curve </li></ul><ul><li>Improved documentation </li></ul><ul><li>Reduce paper chart pulls (if using electronic format) </li></ul><ul><ul><li>Estimated to cost $5/chart </li></ul></ul><ul><li>Decrease costs for transcription </li></ul><ul><li>Prompters/Reminders improve </li></ul><ul><ul><li>Preventive care </li></ul></ul><ul><ul><li>Quality of care </li></ul></ul><ul><ul><li>Treatment options </li></ul></ul><ul><ul><li>Evaluation options </li></ul></ul>
  25. 25. MedicalTemplates ROI Assumptions <ul><li>Template cost $150 per practitioner </li></ul><ul><li>Computer cost $350 (most offices already have >1 computer) </li></ul><ul><li>Baseline under coding rate 30% ($300 lost revenue/day) </li></ul><ul><li>Reduction in under coding 50% </li></ul><ul><ul><li>If 33% of 30 patients seen in one day are under coded </li></ul></ul><ul><ul><ul><li>10 patients are under coded by $30 apiece = $300/day </li></ul></ul></ul><ul><ul><ul><li>A 50% reduction = Only 5 patients are under coded </li></ul></ul></ul><ul><ul><ul><li>Increased revenue = $30 x 5 patients now coded correctly = $150 </li></ul></ul></ul><ul><li>Increased revenue of $150/day equates to a savings of </li></ul><ul><ul><li>$750/week $3000/month >$36,000/year! </li></ul></ul>At $150 per template, the template pays itself off in 1 day!
  26. 26. MedicalTemplate ROI Calculation Including Computer Costs <ul><li>In just 1 month, </li></ul><ul><li>the Return On Investment (ROI) could be: </li></ul><ul><li>Average improvement in reimbursement in 1 month </li></ul><ul><li>X 100 = ROI </li></ul><ul><li>Cost of Template + Cost of Computer </li></ul><ul><li>$3000 </li></ul><ul><li>X 100 = 600% </li></ul><ul><li>$150 + $350 </li></ul>
  27. 27. MedicalTemplate ROI Calculation Without Computer Costs <ul><li>In just 1 month, </li></ul><ul><li>the Return On Investment (ROI) could be: </li></ul><ul><li>Average improvement in reimbursement in 1 month </li></ul><ul><li>X 100 = ROI </li></ul><ul><li>Cost of Template </li></ul><ul><li>$3000 </li></ul><ul><li>X 100 = 2,000% </li></ul><ul><li>$150 </li></ul>
  28. 28. Time to Recover Cost of MedicalTemplate <ul><li>MedicalTemplate + Computer ($500) </li></ul><ul><ul><li>$500/$150 ~ 3 days </li></ul></ul><ul><li>MedicalTemplate without Computer ($150) </li></ul><ul><ul><li>$150/$150 = 1 Day! </li></ul></ul>
  29. 29. Savings Not included in ROI Estimates <ul><li>Reductions in down coding </li></ul><ul><li>Reductions in claim denials </li></ul><ul><li>Reduced time spent on documentation </li></ul><ul><li>Reduced time pulling charts </li></ul>
  30. 30. MedicalTemplates <ul><li>General forms </li></ul><ul><li>Clinic H&P </li></ul><ul><li>Clinic Follow Up Note </li></ul><ul><li>Hospital H&P </li></ul><ul><li>Hospital Follow Up </li></ul><ul><li>Pulmonary/Critical Care H&P </li></ul><ul><li>Pulmonary/Critical Care Follow Up </li></ul><ul><li>Pulmonary Clinic H&P </li></ul><ul><li>Problem specific forms </li></ul><ul><li>Asthma </li></ul><ul><li>COPD </li></ul><ul><li>Pneumonia </li></ul><ul><li>Pleural Effusion </li></ul><ul><li>Lung Mass </li></ul><ul><li>Interstitial Lung Disease </li></ul><ul><li>Chest Pain </li></ul><ul><li>Pulmonary Hypertension </li></ul>
  31. 31. MedicalTemplates <ul><li>MedicalTemplates has created multiple medical templates appropriate for evaluating patients in the clinic or hospital setting. </li></ul><ul><ul><li>MedicalTemplates are fillable PDF forms that allow the physician to type historical information directly into the form. </li></ul></ul><ul><ul><li>They can be saved electronically for later reference. </li></ul></ul><ul><ul><li>Documentation time is decreased </li></ul></ul><ul><ul><ul><li>Most components of the history and physical exam can be completed by checking the appropriate box. </li></ul></ul></ul><ul><li>Reducing documentation time by 5-10 minutes per patient could save the physician >2 hours per day! </li></ul><ul><ul><li>30 patients / day x 5 minute decrease / patient = 2.5 hours / day SAVED! </li></ul></ul>

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