This presentation was given on May 14, 2014 at the Michigan Association for Home Care by Seva Law Firm Owner and Attorney, Pratheep Sevanthinathan. Seva Law Firm specializes in insurance litigation.
3. Liability/Injury Insurers
Severely injured individuals often need home health care
Liability policies are typically primary for reimbursement for injuries
Most common types of liability insurers you will deal with:
Premise Liability
Worker’s Compensation
No-Fault Insurance
Reimbursement for premise and workplace injuries is challenging for home
health agencies
Premise policies have reimbursement caps. Can be low.
Worker’s comp rates are low.
No-Fault Auto insurance can be lucrative
4. Premise Liability
Accidents inside buildings
Workplace accidents excluded
Commercial and residential
Most common: “slip and falls”
Falling objects
Ceiling collapses
Patient must prove liability
100% contractual – limits to reimbursement:
Medical bills will be capped at the policy limits
Residential policies are smaller
Commercial policies can be larger
5. Worker’s Compensation
Workplace accidents
Slip and falls
Falling objects
Auto accidents (company vehicle)
Medical reimbursement is set by a
”fee schedule.”
Not all services are covered by
Worker’s Comp
WC Bureau (Administrative)
No civil court remedies
6. No-Fault Insurance
Auto accidents
Eligible for coverage even if you
cause accident
Few exceptions to coverage that can
make reimbursement a pain
Michigan is only state with unlimited
medical coverage!
Insurer must reimburse reasonable,
necessary, and accident-related bills
7. No-Fault Insurance
Incentives/Benefits
Why should my agency care for auto
accident patients?
All home health covered
No caps
Lifetime medical
No automatic reductions
Almost everyone is covered by No-
Fault
Even if you don’t have car insurance
Few exceptions
8. Submit Bills & Get Paid
Typical reimbursement process:
1) Obtain a script for care;
2) Determine the proper insurer, claim number,
and adjuster;
3) Contact adjuster to determine if claims is
open and billable;
4) Provide exemplary care;
5) Maintain adequate records regarding care;
6) Forward bill to the adjuster;
7) Adjuster may request additional records or
information;
8) Get paid!
9. Why am I not getting paid?
Big Picture
Business model of an insurance
company:
For-profit
Collect as much money as possible (via
premiums)
Pay out as little as possible (in claims)
Every bill is thoroughly reviewed
before payment is approved
Insurers will not pay any bills for which
they are not legally responsible
10. Why am I not getting paid?
Patient v Agency
Issues with patient
Causation
Necessity
Statutory bar
Policy cap
Issues with agency
Rates
Reasonableness
Compliance with rules
Service not covered
11. Why am I not getting paid?
Patient Issues (Necessity of Services)
Lack of script/prescription
“Independent” Medical Examination
Insurance company doctor hired to kill
a claim
Adjuster will specifically ask IME doc
whether home care is necessary
12. Why am I not getting paid?
Patient Issues (Causation)
Exclusive remedies
Premise cases – only responsible for
injuries arising out of the premise accident
Worker’s comp – only responsible for
workplace accidents
No-Fault – injury must arise out of the use
of a motor vehicle
Source of care
Pre-existing condition
Intervening/subsequent event
Injury not covered under policy
13. Why am I not getting paid?
Patient Issues (Other)
Statutory bar
SOL
Illegal claim
Fraud
Policy cap
Once policy limits on a premise policy
are exhausted, must look to next
payment source.
14. Why am I not getting paid?
Agency Issues
Rates – your rates are too high for the
services you provide
Reasonableness – you provided more
care than was actually prescribed or
recommended
Compliance with rules – unlicensed,
insufficient records, not enough
improperly billed
Services not covered – worker’s comp
does not cover all home health
15. Why am I not getting paid?
The fly-by-night home health agency
No accreditation or licensing required for
attendant care reimbursement under
No-Fault Act
Opens the door for fraud
Companies pop up just to serve a single
patient
Muddies the water for legitimate home
health agencies
Fly-by-night companies are ruining your
reputation
Insurance companies will assume you are
fly-by-night unless you prove otherwise
16. How do I avoid denials?
Anticipate payment issues
If the patient has
coverage/reimbursement issues you will
not likely not get paid
Talk to the patient, adjuster, and patient’s
attorney to see if there are any
foreseeable issues with obtaining
payment.
Was your referral source able to get paid?
Discuss with the biller for the referral source
Avoid problematic claims if possible
17. How do I avoid denials?
Documentation!
Well-maintained and detailed records are key
Don’t leave the insurer any doubt that you
performed the services and worked hard
Bill reasonably and logically
Set your rates within a reasonable deviation of the
median
If you are just starting out, charge a little bit less
Don’t be greedy
Get licensed and accredited
Join a network, e.g. Cofinity
Obtain a consulting report on your rates
Know the law
18. What do I do if a bill is denied?
Determine the reason ASAP
Is it a patient issue or an agency issue?
Will determine your next step
Does the insurer have an appeals
process you can utilize?
Have a standard appeals drafted to
use as a template
Consider retaining an attorney
19. Don’t take no for an answer, get an
attorney!
Attorney can represent your bill in two
ways:
Can represent your patient in an action
against the insurer
Can represent your bill only
NO FEE unless bill is collected
Insurance cases are typically handled
on a contingent basis
I cannot speak for all attorneys
20. Benefits of hiring an attorney
Much more likely to get bills paid
Patient issues can always be countered
through litigation
No-Fault Act imposes heavy sanctions for
losing at trial. Puts pressure on insurance
company to pay
Much more likely to get a larger portion
of the bill paid
Insurance company will offer significantly
more if they know you are willing to fight
Adjuster’s don’t like being dragged into
court and will pay you extra to let them
out
21. Drawbacks of hiring an attorney
You may get deposed
Additional paperwork involved
(interrogatories)
Attorney fee if there is a recovery
(although there are ways to obtain
free services)
22. Basics of litigating insurance claims
Time is of the essence – know the statute of limitations.
Communicate regularly with your attorney
Intervention v direct suit?
District court v circuit court?
Distance yourself from the patient
You may have to invoke the “innocent third party doctrine”
23. Conclusion
Don’t operate in a manner than leaves you open for denials
Be proactive about pursuing payment
Be ready for a fight
Know why your bills are being denied.
Don’t shy away from legal action
The benefits of litigating far outweigh the drawbacks
Don’t give up on any bills!