Microsoft PowerPoint - Physician Presentation 04

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4/16/2008 Coastal Healthcare Consulting Group, Inc. 1

Work Smarter,Not Harder

Contracting Savvy for Physicians

Coastal Healthcare Consulting Group, Inc. 24/16/2008

Purpose…

Level the playing field between physicians and Healthplans/Payors.

Assist physicians in building a more efficient and profitable practice.

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Current Status…

Payments are rapidly declining while physicians are working harder.

Office practice costs are increasing: MPI average annual increase of 5%

Stacked contracting as a result of physicians signing multiple agreements severely reduces rates.

Reconciling contract payments seems an impossible task.


Causes…Physicians are busy seeing patients; Healthplansspend the day with attorneys and accountants making contract language impossible to understand.

Lack of training of front office staff – example: out of panel patients are turned away in error.

Physicians bought into the fear factor that they needed to sign any and all agreements.

100% Medicare Allowable became the standard payment.

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More Causes…

Physicians eventually accepted sub-standard conditions assuming they have no choice.

Physicians sign contract/credentialing documents without any review.

Physicians do not budget nor staff for a contracting person.


Average physician-generated revenue dropped 19% from 2004 to 2007.

Office practice costs increased 5% a year on average.

Pending Medicare cuts in 2008 could bring another 10% decrease in reimbursement.

Physician and office staff salaries are stalled or decreasing.

Ok, But What Does That Mean To Me?

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How Do I Fix It?

Request copies of current contracts from your top 10 Healthplans.

Request copies of fee schedules for your top 10 codes.


Sample of Reimbursement Comparison by Plan*

*For demonstration purposes only$209.30 $166.00 $208.60 $198.09 NOT COVRD $186.66 $497.00 SYNVISC J7320 (AWP-$186.33)Q4084

$111.53 $109.54 $123.25 $105.66 NOT COVRD $104.85 $283.00 HYALGAN J7317 (AWP-$94.00)Q4083

$543.54 $512.75 $500.00 $543.40 $665.00 $436.28 $543.39 $1,324.00 MRI LOWER (73721)73718

$543.54 $512.75 $500.00 $547.39 $695.88 $436.28 $547.39 $1,324.00 MRI UPPER (73221)73218

$35.15 $34.38 $33.80 $33.34 $47.50 $23.38 $33.44 $84.00 X-RAY KNEE73562

$616.42 $968.64 $586.21 $576.75 $1,133.73 $477.29 $576.74 $1,398.00 ARTHROSCOPY/DEBRIDE KNEE29877

$1,058.93 $1,556.64 $1,005.53 $941.01 $2,296.53 $674.61 $1,144.83 $2,400.00 ACL REPAIR29888

$1,589.56 $2,036.51 $1,509.01 $1,459.37 $2,514.56 $1,489.20 $1,459.37 $3,600.00 TOTAL KNEE27447

$1,471.53 $1,995.04 $1,396.42 $1,355.47 $2,703.51 $759.12 $1,355.47 $3,332.00 TOTAL HIP27130

$74.71 $56.28 $70.97 $46.87 $45.90 $45.79 $69.25 $178.00 INJECTION MAJOR JOINT20610

$565.53 $542.08 $538.66 $516.18 $413.10 $271.41 $553.73 $1,346.00 CLOSED REDUCTION RADIUS25605

$126.62 $128.45 $126.82 $93.61 $131.62 $59.50 $124.37 $312.00 DETAILED CONSULT99243

$54.72 $56.31 $57.71 $42.48 $47.60 $24.00 $60.86 $135.00 ESTB VISIT99213

BLUESHIELD

BLUECROSSAETNATRICARE

TRIWESTWORKCOMPMEDI-CALMEDICARECHARGEDETAILED CONSULTPROCEDURE

CODE

* For demonstration purposes only

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Sample Volume Report*

*For demonstration purposes only

Healthplan AmountBilled

AmoutReceived

Amount Received Compared to

100% of Medicare

Aetna $350,000 $170,000 93%

Blue Cross $750,000 $300,000 89%

Blue Shield $300,000 $170,000 102%

CIGNA $60,000 $38,000 104%

Health Net $50,000 $20,000 88%

Tri West $100,000 $30,000 66%

Medi-Cal $30,000 $5,000 28%

XYZ MedicalGroup $80,000 $65,000 130%


Terminate Low Volume Healthplans

Simple Volume Report – amount billed vs. amount collected.

Terminate anything under 80% of Medicare.

It’s not only the Plan, it’s the Affiliates…

You are providing discounts for no reason.

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Terminate Silent PPO’s

Terminate Silent PPO, Network and Affiliate Contracts.

A Silent PPO is an administrative organization who leases/sells physicians discounts for a fee. They have no members and they are not licensed as insurance companies.

They have “ Affiliates” that use your discount, they also “rent” physician to “networks” for a fee.


How Do I Know It Is A Silent PPO?

Look at your EOB’s

Probably no contract signed.

They are not the Payor.

Look on their website for claims “chop shop”language.

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Sample Of A Bad EOB


Website “Chop Shop”Language

“We offer management services aimed at eliminating unnecessary medical costs. In 2007, clients enjoyed a savings to cost ratio of 8:1. Working closely with you to design and build effective cost containment solutions, XYZ will customize a review program to suit your needs.”

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Silent PPOs…Declining To Be Included

[[Physician’s Letterhead]

[Date]

[Contact Person] VIA CERTIFIED MAIL – RETURNED RECEIPT[Healthplan][Address][City, St Zip]

Re: [Name of Physician]

Dear [Contact Person]:

This letter is to confirm that pursuant to California law, I hereby exercise my right to decline to be included in any list of contracted providers that is sold, leased, transferred, or conveyed by you to any current or future payors that do not actively encourage the payors’ beneficiaries to use the list of contracted providers when obtaining medical care. See Business & Professions Code §511.1; Health & Safety Code §1395.6; Insurance Code §10178.3; and Labor Code §4609.

Also, please include my fee schedule. I have enclosed, in a separate form, my top 15 codes for you to price.

Thank you for your attention to this matter.

Sincerely.

[Physician’s Name]

cc: File


Once Terminated…“Out of Network”

IsGood Business

“Out of Network” usually pays 2 times in network rates. The exception is Blue Cross.

Must educate staff. You DO take XYZ insurance, you are simply out of network.

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Renegotiating Contracts

IS

Good Business


Typical Renegotiation Results*

* Based on a 3-Physician practice

Healthplan Increase % Additional RevenuePer Year Silent PPO Silent PPO

Terminations

Blue Cross 5% $30,000.00 Multiplan 30% $54,000.00

PacifiCare/United 20% $70,000.00 Interplan 30% $20,000.00

Health Net 10% $5,000.00 Focus 35% $5,000.00

CIGNA 10% $3,000.00 First Health 20% $7,000.00

Net Increase $108,000.00 Add. Income $86,000.00

$194,000.00Annual Net Increase

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Recap

Organize contracts.

Construct a grid.

Eliminate Silent PPOs.

Renegotiate key contracts.

“Out of Network” is good business.


Summary

Get smarter.

Allocate human resources to manage your revenue.

Train your human resources to maximize your revenue.

Be more selective and diligent about your contracted revenue.

To work smarter, not harder, you must:

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Conclusion…

An increase in revenue of $30,000 to $70,000 a year per physician.

Less stress.

Higher level of efficiency which equals….

Working less and making more.

Diligent Contracting Results In:


Contact Information…

Kim FentonCoastal Healthcare Consulting Group, Inc.Phone: (714) 544-5488Fax: (714) 544-7188Cell: (714) 651-7319E-mail: [email protected]: www.HealthcareConsultant.org

Microsoft PowerPoint - Physician Presentation 04

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