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SGR REPEALED

04/17/2015

The long journey to repeal SGR is officially over.  President Obama signed the bill passed by both the House and Senate yesterday afternoon.  Medicare now moves into a program that pays “for value” not volume.

We are pleased the SGR has been repealed.  This solution has been long awaited and needed for stability and predictability for physician payments.

We at Innovative will continue guiding our clients through this process of increasing value of their patient care.  Medicare will continue reshaping payments for physician services, and we will keep you updated as changes are made.

SGR Update - Ron Decker meets with Sen. Lankford

04/10/2015

This morning Ron Decker, Innovative Healthcare CEO, had the opportunity to spend time with Senator James Lankford (R-OK) regarding the issue of the SGR Repeal or the “Doc Fix”. Senator Lankford was optimistic that the legislation should end up on the President’s desk by this time next week, although there would most likely be some amendments.  It is widely anticipated that the President will sign it into law.  This is not breaking news, as most medical associations have indicated that the repeal process would legislatively move in this direction.

As you are aware, the 21% cut for Medicare services went into effect April 1st because the law had not been passed in the Senate and signed by the President.  The Medicare program holds claims for 10 business days before processing.  So claims for dates of service after the 1st could be processed beginning April 15th.

Ron expressed concern that delaying the process any more will have a negative impact on our clients, and Innovative with the additional costs associated with processing and reprocessing after the repeal of the 21% cut.  The Senator expressed his interest in moving the bill quickly to avoid this scenario, but did indicate that there could be delays beyond the 10 day standard.

Therefore we wanted you to be aware as it will impact our clients Medicare reimbursement in the short term.

We will watch this situation closely next week and notify you as soon as we have information that is definitive.

Billing Under PPACA...Elusive or Transformational

04/08/2013
The law of the past cannot be eluded.
The law of the present and future cannot be eluded,
The law of the living cannot be eluded…it is eternal,
The law of promotion and transformation cannot be eluded…

Walt Whitman – “Leaves of Grass”

In 1961, I was born in a hospital that had been converted from a home in a small town 40 miles from the suburban community where my parents lived at the time.  When I asked my parents why they chose the small town for my grand entry, their response was, they didn’t.  Because they were both busy teachers and didn’t have a relationship with a physician, my dad’s family referred them to a physician who practiced nearby.  Since the closest hospital, where the physician delivered little bundles of joy, was in the small town 40 miles from suburbia, my parents drove “out-of-town” for my fateful arrival.  It was a small “hospital”, so crowded that mom, five hours after I was born, was moved to the couch in the hospital library because they needed her bed for a more acute patient.  Speaking of a cute patient, dad went to work that morning and wasn’t really sure where yours truly was until his family picked mom and I up the following day.  What was the cost of services for my successful transition into the world?  Twenty one dollars after insurance, and how do I know?  I possess the smallish, single page document with the typewritten services description and “balance $21” typed across the page.

Twenty seven years later, my first son was born at a suburban facility by an obstetrics physician that was referred to us by friends.  Caesarean section, nurses everywhere, transition training, dietary discussions, diaper training, nursery care, breast feeding educational services, the bottom line is we had great care and a wonderful experience.  What was the total out of pocket for all of this?  Twenty seven dollars, I think.  To be honest, all I remember was paying three dollars per prenatal visit.  I NEVER remember receiving a final statement from the facility.  I was told that because we chose a participating facility in our HMO plan, they had pre-negotiated payment for services with the hospital.

Our next three sons not so much; I think I’m still paying for the hospital’s labor and delivery suite.  So what’s the point?  The dollars and the change, not as in coin change but change in the information.  The outcomes were similar, ie., healthy babies transitioning into this world in hospitals with considerate, well trained and competent care givers.  However, by the time my last son was born, I was on the receiving end of an enormous line itemed hospital bill, countless other provider statements, EOB’s from the payor, re-filed claims, calls to the hospital, providers, etc.  Massive change, and since I was in the business, I understood most of it, but the volume, diversity of lingo and complexity of information was overwhelming.

Over the past 20 years many of the problems created due to the changes in health care, have been addressed by people.  People who were task oriented, hard-working and caring people that got busy, rolled up their sleeves and with the success of the provider foremost on their mind, found solutions.  Then slowly, an industry evolved, these caring people solved reimbursement problems for their provider’s practice.  Primarily through word of mouth and their previous triumphs, “Billing Services” began to emerge.    Call them what you will, these entrepreneurs discovered a need, found a solution and developed an industry that has helped to improve much more than the economics of health care practices, they have helped to improve the patient experience.

As medical billing software, knowledge, and best practices continue to improve, the industry has done its part in lowering costs by engaging in newer technologies, improved staff training and continuously develops leadership within their organizations.  The industry and it’s collaborative voice, the Healthcare Billing and Management Association (HBMA), have both been proactive with regulatory agencies, the payors and most assuredly the patient.  We have simplified patient statement communication, designed call centers and trained staff to be empathetic with the patient while educating them on behalf of our clients, the providers.

In 2009, Professor Antoinette Schoar[i], MIT – outlines two types of entrepreneurs.  The Subsistence entrepreneur provides solutions in a very connected way.  Motivated by provision, they engage their task oriented skillset in an effort to meet a need.  The second classification Schoar identifies is the Transformational entrepreneur.  Although, somewhat task oriented, this classification of entrepreneur is able to identify shifts in technology, policy or markets and provide organizational growth on a larger scale than subsistence entrepreneurs.

In a related paper on Entrepreneurs, Jing Chen[ii] exhaustively weaves these terms; serial entrepreneurs, selection, ability, entrepreneurial experience and learning by doing into a discussion of how successful entrepreneurs think, interpret, react, resolve and grow their businesses.  Through a steady process of interpreting the need, recommending a solution, implementing the solution and then monitoring results, the DNA of the entrepreneur is to solve market problems with products and services delivered in a consistent high quality process.

Health care under the Affordable Care Act is going to evolve over the coming years.  The mechanisms for financing health care are going to require accountability, and rightfully so.  With health care approaching one fifth of our National gross domestic product, there needs to be accountability.  Health care reform legislation has charged the Secretary of Health and Human Services with creating an estimated 400 programs that improve patient access and quality of care in addition to controlling costs.  To date, fewer than 25% have been translated into regulation.  A few that we, in the billing industry, are aware of are:

  • Bundled Payments- The Agency for Healthcare Research and Quality (AHRQ) defines a “bundled payment” as a health care provider payment method in which the payment is related to the predetermined expected costs of an episode of care. Their definition includes several related concepts that have been referred to as “bundling,” “packaging” “episode-based payment,” and “warranties.” These concepts refer to different ways to aggregate services into a single unit of payment. Specific payment models may include some or multiples of these aggregation methods.
    • Aggregation of services longitudinally in time for an episode of care. The episode is defined to encompass services related to a health care treatment or condition within a defined time window. For example, a single payment could include a surgical procedure and follow-up care. Distinctions are also sometimes made between ―packaging‖ of services provided during a single patient encounter and ―bundling‖ of services during multiple visits.
    • Aggregation of services across providers who may be practicing in different care settings. For example, a single payment could be made for inpatient hospital facility services and physician professional services during an inpatient stay.
    • Warranties refer to payment arrangements where payment for services related to treatment complications is aggregated into the unit of payment. Providers assume financial risk for the cost-of-care defects above a predetermined amount

AHRQ further distinguishes the differences between these payment modalities where treatment is based on episodes of care, while global payment or capitation payment is made for the management of a defined patient population.

Source: http://www.effectivehealthcare.ahrq.gov/Published Online: June 23, 2011

  • Carve Out Claims Processing- When the employer company provides our group medical insurance to retirees or others who do not have current employee status, Medicare Carve-Out benefits are typically provided. Medicare Carve-Out benefits coordinate with Medicare’s benefits such that combined benefits can be made available that are equivalent to the benefits provided to active employees. Medicare is the primary payer. Covered persons must enroll for Medicare Part A (Hospital Insurance) and Medicare Part B (Medical Insurance). If a covered person fails to enroll for Medicare, benefit payments will be reduced by an estimate of the amount Medicare would have paid had he or she enrolled.

Despite the MSP rules, the law does not force an employee to accept coverage under his or her company’s group health plan. If an employee who is entitled to Medicare refuses coverage under your plan, Medicare will be the primary payer. In this situation, your plan is not allowed to provide any benefits to supplement the individual’s Medicare benefits http://www.cms.gov/Regulations-and-guidance/Guidance/Transmittals/downloads/R8MCM.pdf

  • Patient Centered Medical Home (PCMH)[iii]
    • Practice Organization – Do you have a disciplined financial management approach?  Do you embrace a culture of change in your medical practice?  Do you have a staffing model & practice environment that supports a PCMH?
    • Quality Care -  Do you & your staff foster a culture of improvement?  Do your care plans include these components…? Do you utilize risk-stratified care management principles to manage your patient population?….
    • Health Information Technology – Do you have a sound technology infrastructure in place?  Is your practice digitally connected to the medical neighborhood?  Have you considered these attributes in your EHR system?….
    • Patient Centered Care – Do you have processes to ensure patients’ access to care?  Do you engage patients in shared decision-making?  Does your practice support patient self-management?…..

After reading these three simplified descriptions of new or changing regulations in health care, some of our colleagues will consider these changes as having little affect on our organizations, some will become frantic and some will see opportunity.  When looking at these examples more closely, we have to ask the question, who creates, oversees, and manages these procedures, systems, and processes now?  The answer, few, if any.

Implementation of the mountain of changes contained in the Patient Protection and Affordable Care Act will evolve for years to come.  The processes and systems to implement the changes are simply not available today.  However, the solutions will evolve as people with a relationship to a provider recognize the need.

“Over the next 20 years, many of the problems created under PPACA, will be addressed by people.  People who are task oriented, hard-working and caring people that get busy, roll up their sleeves and with the success of the provider foremost on their mind, find solutions.  These caring people will solve economic and informational problems for their provider’s practice.  Then slowly, an industry will be transformed.  Primarily through word of mouth and their previous triumphs, “Billing Services” will begin a transformational process.    Call them what you will, these entrepreneurs will discover a need, find a solution and develop an industry that will help to improve much more than the economics of health care practices, they will help to transform the patient experience”.


[i] The Divide between Subsistence and Transformational Entrepreneurship – Professor Antoinette Schoar, MIT – NBER Innovation Policy and the Economy – May 29, 2009

[ii] Selection and Serial Entrepreneurs – Jing Chen – Florida International University – September 2009

[iii] AAFP – http://www.aafp.org/online/en/home/membership/initiatives/pcmh.html

© 2012 – Ron M Decker
Twitter -  RonMDecker
Linkedin – Ron Decker – CHBME
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