Don't Be Shy About Money: Code Smartly, Appeal Always

SANTA MONICA, CALIF. — Recommendations that you adjust your default coding for an office visit upward and appeal all denied insurance claims were among numerous tips on how to increase income that were offered by Dr. Joseph S. Eastern at a meeting sponsored by

With the demise of consultation codes on Jan. 1, 2010, many rheumatologists are concerned about balancing their budgets. When assessing their bottom line, physicians tend to put undue emphasis on reducing their practice overhead. However, it is unlikely that overhead is the problem.

Most practices have cut overhead to the bone, said Dr. Eastern, a dermatologist in Belleville, N.J. Cutting overhead too much, by reducing the number of office staff and/or hiring unskilled workers, will lessen practice efficiency and—in the end—reduce revenue.

“Your ability to decrease costs is limited, while your ability to increase revenue is unlimited. Putting it another way: Would you rather keep 60% of $800,000 or 40% of $2 million?” challenged Dr. Eastern, who also is on the faculty of Seton Hall University, South Orange, N.J.

So rather than asking how to decrease overhead, the better question is how to increase revenue. The first step is to renegotiate your contracts with your third-party payers every year. This is not a time to be shy. Third-party payers are not going to call to announce they've been underpaying you. When Dr. Eastern asked the attendees to raise their hands if they renegotiated their contracts yearly, few hands went up.

“Every year, we send a letter to the lowest payer that says: 'We'll keep you if you pay us the going rate rather than what you are paying us now.' They may not give you what you ask for, but they'll give you more if you make a good case for the increase.”

Most physicians tend to under-code because of their fear of being audited. But they do more than they are coding for. By changing their default office visit code from level 2 to level 3, physicians can increase their income by about $100,000 a year. “That's pure profit,” said Dr. Eastern, who said his observation is based on a study he did of N.J. physicians.

“If you are doing level 3 worth of work, you should code for it. You are entitled to it. According to the CPR code book, a level 3 exam involves an established patient with either one worsening problem or one new problem or two or more chronic or inactive problems, plus documentation of a pertinent review of systems, which in rheumatology comes down to asking 'How are your joints? Are you having problems with any of your joints?' Then a 99213 code is justified. The key word is documentation,” he said.

Appeal all denied claims, he advised. The code examiner often knows nothing about medicine and has just a few months experience in the job. Data on dermatologists show that they file 30 million Medicare claims yearly. An estimated 6%, or almost 2 million claims, are denied. Of those, fewer than 5% are appealed, “which is just inexcusable,” Dr. Eastern said. The data on dermatologists show the chance that the appeal will increase payment is 50%. “What else are you doing that has a 50% return?” Dr. Eastern challenged.

People in other lines of business are amazed that physicians let patients walk out without paying. Instead, he said, take an imprint of each patient's credit card. Then, when the insurance payment comes in, charge the balance on the credit card. “We have decreased our accounts receivable by 50% just by having people do this.

“Patients sign an authorization that we can charge the unpaid balance to their card. Our office manager calls the patient if the charge is greater than $50. We keep the credit card number in the patient's chart, with all the other confidential information,” Dr. Eastern said.

Disclosures: Dr. Eastern reported that he has no financial disclosures to make. SDEF and

Rather than letting people walk out of your office without paying, take an imprint of their credit card.

Source DR. EASTERN

SANTA MONICA, CALIF. — Recommendations that you adjust your default coding for an office visit upward and appeal all denied insurance claims were among numerous tips on how to increase income that were offered by Dr. Joseph S. Eastern at a meeting sponsored by

With the demise of consultation codes on Jan. 1, 2010, many rheumatologists are concerned about balancing their budgets. When assessing their bottom line, physicians tend to put undue emphasis on reducing their practice overhead. However, it is unlikely that overhead is the problem.

Most practices have cut overhead to the bone, said Dr. Eastern, a dermatologist in Belleville, N.J. Cutting overhead too much, by reducing the number of office staff and/or hiring unskilled workers, will lessen practice efficiency and—in the end—reduce revenue.

“Your ability to decrease costs is limited, while your ability to increase revenue is unlimited. Putting it another way: Would you rather keep 60% of $800,000 or 40% of $2 million?” challenged Dr. Eastern, who also is on the faculty of Seton Hall University, South Orange, N.J.

So rather than asking how to decrease overhead, the better question is how to increase revenue. The first step is to renegotiate your contracts with your third-party payers every year. This is not a time to be shy. Third-party payers are not going to call to announce they've been underpaying you. When Dr. Eastern asked the attendees to raise their hands if they renegotiated their contracts yearly, few hands went up.

“Every year, we send a letter to the lowest payer that says: 'We'll keep you if you pay us the going rate rather than what you are paying us now.' They may not give you what you ask for, but they'll give you more if you make a good case for the increase.”

Most physicians tend to under-code because of their fear of being audited. But they do more than they are coding for. By changing their default office visit code from level 2 to level 3, physicians can increase their income by about $100,000 a year. “That's pure profit,” said Dr. Eastern, who said his observation is based on a study he did of N.J. physicians.

“If you are doing level 3 worth of work, you should code for it. You are entitled to it. According to the CPR code book, a level 3 exam involves an established patient with either one worsening problem or one new problem or two or more chronic or inactive problems, plus documentation of a pertinent review of systems, which in rheumatology comes down to asking 'How are your joints? Are you having problems with any of your joints?' Then a 99213 code is justified. The key word is documentation,” he said.

Appeal all denied claims, he advised. The code examiner often knows nothing about medicine and has just a few months experience in the job. Data on dermatologists show that they file 30 million Medicare claims yearly. An estimated 6%, or almost 2 million claims, are denied. Of those, fewer than 5% are appealed, “which is just inexcusable,” Dr. Eastern said. The data on dermatologists show the chance that the appeal will increase payment is 50%. “What else are you doing that has a 50% return?” Dr. Eastern challenged.

People in other lines of business are amazed that physicians let patients walk out without paying. Instead, he said, take an imprint of each patient's credit card. Then, when the insurance payment comes in, charge the balance on the credit card. “We have decreased our accounts receivable by 50% just by having people do this.

“Patients sign an authorization that we can charge the unpaid balance to their card. Our office manager calls the patient if the charge is greater than $50. We keep the credit card number in the patient's chart, with all the other confidential information,” Dr. Eastern said.

Disclosures: Dr. Eastern reported that he has no financial disclosures to make. SDEF and

Rather than letting people walk out of your office without paying, take an imprint of their credit card.

Source DR. EASTERN

SANTA MONICA, CALIF. — Recommendations that you adjust your default coding for an office visit upward and appeal all denied insurance claims were among numerous tips on how to increase income that were offered by Dr. Joseph S. Eastern at a meeting sponsored by

With the demise of consultation codes on Jan. 1, 2010, many rheumatologists are concerned about balancing their budgets. When assessing their bottom line, physicians tend to put undue emphasis on reducing their practice overhead. However, it is unlikely that overhead is the problem.

Most practices have cut overhead to the bone, said Dr. Eastern, a dermatologist in Belleville, N.J. Cutting overhead too much, by reducing the number of office staff and/or hiring unskilled workers, will lessen practice efficiency and—in the end—reduce revenue.

“Your ability to decrease costs is limited, while your ability to increase revenue is unlimited. Putting it another way: Would you rather keep 60% of $800,000 or 40% of $2 million?” challenged Dr. Eastern, who also is on the faculty of Seton Hall University, South Orange, N.J.

So rather than asking how to decrease overhead, the better question is how to increase revenue. The first step is to renegotiate your contracts with your third-party payers every year. This is not a time to be shy. Third-party payers are not going to call to announce they've been underpaying you. When Dr. Eastern asked the attendees to raise their hands if they renegotiated their contracts yearly, few hands went up.

“Every year, we send a letter to the lowest payer that says: 'We'll keep you if you pay us the going rate rather than what you are paying us now.' They may not give you what you ask for, but they'll give you more if you make a good case for the increase.”

Most physicians tend to under-code because of their fear of being audited. But they do more than they are coding for. By changing their default office visit code from level 2 to level 3, physicians can increase their income by about $100,000 a year. “That's pure profit,” said Dr. Eastern, who said his observation is based on a study he did of N.J. physicians.

“If you are doing level 3 worth of work, you should code for it. You are entitled to it. According to the CPR code book, a level 3 exam involves an established patient with either one worsening problem or one new problem or two or more chronic or inactive problems, plus documentation of a pertinent review of systems, which in rheumatology comes down to asking 'How are your joints? Are you having problems with any of your joints?' Then a 99213 code is justified. The key word is documentation,” he said.

Appeal all denied claims, he advised. The code examiner often knows nothing about medicine and has just a few months experience in the job. Data on dermatologists show that they file 30 million Medicare claims yearly. An estimated 6%, or almost 2 million claims, are denied. Of those, fewer than 5% are appealed, “which is just inexcusable,” Dr. Eastern said. The data on dermatologists show the chance that the appeal will increase payment is 50%. “What else are you doing that has a 50% return?” Dr. Eastern challenged.

People in other lines of business are amazed that physicians let patients walk out without paying. Instead, he said, take an imprint of each patient's credit card. Then, when the insurance payment comes in, charge the balance on the credit card. “We have decreased our accounts receivable by 50% just by having people do this.

“Patients sign an authorization that we can charge the unpaid balance to their card. Our office manager calls the patient if the charge is greater than $50. We keep the credit card number in the patient's chart, with all the other confidential information,” Dr. Eastern said.

Disclosures: Dr. Eastern reported that he has no financial disclosures to make. SDEF and

Rather than letting people walk out of your office without paying, take an imprint of their credit card.

Source DR. EASTERN