Work Smarter, Not Harder Contracting Savvy for Physicians
4/16/2008
Coastal Healthcare Consulting Group, Inc.
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Purpose… Level the playing field between physicians
and Healthplans/Payors. Assist physicians in building a more efficient
and profitable practice.
4/16/2008
Coastal Healthcare Consulting Group, Inc.
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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. 4/16/2008
Coastal Healthcare Consulting Group, Inc.
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Causes… Physicians are busy seeing patients; Healthplans
spend 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. 4/16/2008
Coastal Healthcare Consulting Group, Inc.
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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.
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Coastal Healthcare Consulting Group, Inc.
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Ok, But What Does That Mean To Me? 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. 4/16/2008
Coastal Healthcare Consulting Group, Inc.
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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.
4/16/2008
Coastal Healthcare Consulting Group, Inc.
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Sample of Reimbursement Comparison by Plan* PROCEDURE CODE
DETAILED CONSULT
CHARGE
MEDICARE
MEDI-CAL
WORK COMP
TRICARE TRIWEST
AETNA
BLUE CROSS
BLUE SHIELD
99213
ESTB VISIT
$135.00
$60.86
$24.00
$47.60
$42.48
$57.71
$56.31
$54.72
99243
DETAILED CONSULT
$312.00
$124.37
$59.50
$131.62
$93.61
$126.82
$128.45
$126.62
25605
CLOSED REDUCTION RADIUS
$1,346.00
$553.73
$271.41
$413.10
$516.18
$538.66
$542.08
$565.53
20610
INJECTION MAJOR JOINT
$178.00
$69.25
$45.79
$45.90
$46.87
$70.97
$56.28
$74.71
27130
TOTAL HIP
$3,332.00
$1,355.47
$759.12
$2,703.51
$1,355.47
$1,396.42
$1,995.04
$1,471.53
27447
TOTAL KNEE
$3,600.00
$1,459.37
$1,489.20
$2,514.56
$1,459.37
$1,509.01
$2,036.51
$1,589.56
29888
ACL REPAIR
$2,400.00
$1,144.83
$674.61
$2,296.53
$941.01
$1,005.53
$1,556.64
$1,058.93
29877
ARTHROSCOPY/DEBRIDE KNEE
$1,398.00
$576.74
$477.29
$1,133.73
$576.75
$586.21
$968.64
$616.42
73562
X-RAY KNEE
$84.00
$33.44
$23.38
$47.50
$33.34
$33.80
$34.38
$35.15
73218
MRI UPPER (73221)
$1,324.00
$547.39
$436.28
$695.88
$547.39
$500.00
$512.75
$543.54
73718
MRI LOWER (73721)
$1,324.00
$543.39
$436.28
$665.00
$543.40
$500.00
$512.75
$543.54
Q4083
HYALGAN J7317 (AWP-$94.00)
$283.00
$104.85
NOT COVRD
$105.66
$123.25
$109.54
$111.53
$497.00
$186.66
NOT COVRD
$198.09
$208.60
$166.00
$209.30
*ForQ4084 demonstration purposes only SYNVISC J7320 (AWP-$186.33) * For demonstration purposes only
4/16/2008
Coastal Healthcare Consulting Group, Inc.
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Sample Volume Report* Amount Billed
Healthplan
Amout Received
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%
*For demonstration purposes only
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Coastal Healthcare Consulting Group, Inc.
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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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Coastal Healthcare Consulting Group, Inc.
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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. 4/16/2008
Coastal Healthcare Consulting Group, Inc.
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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.
4/16/2008
Coastal Healthcare Consulting Group, Inc.
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Sample Of A Bad EOB
4/16/2008
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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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Coastal Healthcare Consulting Group, Inc.
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Silent PPOs…Declining To Be Included [[Physician’s Letterhead] [Date] [Contact Person] [Healthplan] [Address] [City, St Zip]
VIA CERTIFIED MAIL – RETURNED RECEIPT
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
4/16/2008
Coastal Healthcare Consulting Group, Inc.
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Once Terminated… “Out of Network” Is Good 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 4/16/2008
Coastal Healthcare Consulting Group, Inc.
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Typical Renegotiation Results* Healthplan
Increase %
Additional Revenue Per Year
Blue Cross
5%
$30,000.00
Multiplan
PacifiCare/United
20%
$70,000.00
Health Net
10%
$5,000.00
CIGNA
10%
Net Increase
Silent PPO
Silent PPO Terminations 30%
$54,000.00
Interplan
30%
$20,000.00
Focus
35%
$5,000.00
$3,000.00
First Health
20%
$7,000.00
$108,000.00
Add. Income
Annual Net Increase
$86,000.00
$194,000.00
* Based on a 3-Physician practice
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Coastal Healthcare Consulting Group, Inc.
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Recap Organize contracts. Construct a grid. Eliminate Silent PPOs. Renegotiate key contracts. “Out of Network” is good business.
4/16/2008
Coastal Healthcare Consulting Group, Inc.
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Summary To work smarter, not harder, you must: 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. 4/16/2008
Coastal Healthcare Consulting Group, Inc.
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Conclusion… Diligent Contracting Results In: 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. 4/16/2008
Coastal Healthcare Consulting Group, Inc.
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Contact Information… Kim Fenton Coastal Healthcare Consulting Group, Inc. Phone: (714) 544-5488 Fax: (714) 544-7188 Cell: (714) 651-7319 E-mail: KimF@HealthcareConsultant.org Website: www.HealthcareConsultant.org
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