Managed care, Medicare and Medicaid reimbursements, and the Affordable Care Act (ACA) all present challenges for a medical practice. On the other hand, many problems that arise are self-inflicted. Is your medical practice not performing as well as expected? Are revenues dropping? Are you having problems covering costs? Take a hard look at your practice and diagnose the problem. To help put you on the road to recovery:
Coding after the end of the ICD-10 grace period
After the transition from ICD-9 to ICD-10 went into effect in October 2015, the Centers for Medicare and Medicaid Services ("CMS") allowed medical practices a one-year “grace period” in which to get up to speed with the new reimbursement codes. During the past year, physicians have had a safety net when they’ve made mistakes. But effective October 1, the grace period is over.
The 3.8 percent net investment income tax (“NIIT”) under the Affordable Care Act (“ACA”) has been in effect since 2013 and remained in effect for tax year 2015 and beyond. The taxpayer is liable for NIIT on the lesser of their net investment income (“NII”), or the amount by which their modified adjusted gross income (“MAGI”) exceeds the threshold based on filing status.
The wave of health care reform has led to a closer focus on the need for clear, consistent, and transparent communication of patient financial information. Thus, the Healthcare Financial Management Association ("HFMA") has developed “Patient Financial Communications Best Practices” for improving and standardizing how health care organizations should communicate with patients about their financial responsibilities. The guidance covers several areas of critical importance for community hospitals.
It’s hard to miss news reports discussing the shift in the basis for provider reimbursements from “volume” to “value.” Public (Medicare and Medicaid) and private payers are promoting value-based payment methodologies for physicians and hospitals — including “meaningful use,” “pay-for-performance,” “Accountable Care Organizations,” and “patient-centered medical homes.” So, what does value mean in your practice?
Physician practices face not only clinical and financial risks, but also business ones. Fortunately, insurance can mitigate many of these risks. But practice leaders may not be familiar with the different types of coverage available. Here are eight business policies that every physician practice should consider:
The financial side of the practice appears to be running smoothly. Claims are submitted and paid. Expenses are being paid on time, too. But no one really knows whether the revenue cycle management system is functioning at its peak potential. In such cases, a checkup of the practice’s system may be called for.
Claim denials can be a major source of frustration for physicians and their practice managers, and can have a real impact on cash flow and the financial performance of a practice. If office procedures are good in gathering correct information and submitting clean claims, you can still expect to see at least 5% of denials for claims. So, how can you conquer the issue?
Practices often allow their payer contracts to renew automatically each year without re-examining the terms. But the practice may have changed and added new providers, new services, or a larger patient panel, and perhaps gained an enhanced bargaining position. If so, you may want to make changes to the contract.
An IRS Revenue Ruling went into effect on July 1, 2015 that could cost your company a penalty of $100 per day, per employee (up to $500,000). Under Internal Revenue Code § 4980D, the penalty could be $36,500 per year per employee for employers who do not offer insurance coverage but instead seek to reimburse their employees for insurance purchased on the individual market. If you’re not in compliance, this penalty could put you out of business.