Health Care Group Newsletter – Winter 2017
Amanda Gutierrez, Jason Flahive

Five Ways to Plug Revenue Leakage
Amanda Gutierrez

It isn’t always a major problem that causes a medical practice to lose money. Sometimes a steady drip of small losses — a little bit here, a little bit there — adds up to a big problem. Of course, you need to train and empower your staff to work on accounts receivable and to handle billing issues. However, physicians often lack the tracking of what’s actually going on in their medical practices’ business operations; and when that happens, problems can occur.  These problems can be small and fixed easily, while others may be larger causing more work, time and effort to rectify.

A Few Tips

Before taking any major steps, consider these tips for staying on top of your business processes:

  • Meet regularly with your staff to review reports;
  • Have financial benchmarks;
  • Compare what is happening this year to what happened last year;
  • Determine what is normal in other practices;
  • Audit patient charts regularly; and
  • Look at 10 charts a month (per provider) to ensure they are entered appropriately.

You also may want to hire a professional billing service to occasionally spend a day auditing your charts and receivables. Having a second review is not a bad idea; it can give the business the opportunity to use others’ ideas in implementing new and more efficient procedures that can save time and money.

Five Steps to Take

Even when you engage in the best possible business practices, losses might still occur. Here are five plugs for revenue leakage:

  1. Ask For Your Money
    If a patient owes a co-pay, ask for it. Collect as much up front as is feasible. Create processes and procedures that make it easy to collect fees owed, such as accepting cash, checks and credit cards. You can and should make exceptions, but the bottom line is that a medical practice is a business. Make every effort to ensure no one leaves the office without paying what is owed, whether it’s a bill or a co-pay.
  2. Educate Patients on Estimated Expenses
    When discussing an expensive and complicated procedure, such as a surgery, develop a financial agreement ahead of time so you can educate the patient on the procedure’s cost. Put it in writing and make sure the patient agrees to it by signing it. Both the practice and the patient should receive a copy.
  3. Audit Your Computer Systems
    Computer systems are remarkably reliable, but are not necessarily 100% reliable. It is imperative that you understand what your computer system is actually doing. Sometimes, practice management software features can cause inadvertent problems. For example, one type of software required someone to hit “print claim” after a transaction was saved. The claim was then sent electronically. However, if staff failed to hit the “print claim” button, the claim was not sent. Instead, it showed up as an outstanding balance, even though the insurance company had never received it. Clearly, staff needs to be trained in the correct use of your practice management software.
  4. Offer More Services
    Offer medically appropriate services that could bring in additional revenue. If a patient comes in with a specific ailment, this is a potential opportunity to offer a more thorough checkup, resulting in more targeted services and care. In addition to creating better results and more comprehensive care for the patient, it will generate more revenue.
  5. Badger the Insurers
    As most physicians know, filing an insurance claim and getting exactly what you expect to receive is rare. Update your insurer contracts on a regular basis. Review your price lists and send them to insurance companies. From time to time, insurance carriers change their reimbursements, and (even more rarely) increase their reimbursements. Appeal claims and get to know your state Medicare liaison. Join your state’s specialty medical association to pool resources when dealing with insurers.

The Sixth Step

The worst revenue loss often is embezzlement. After that, it is losing patients. By keeping your patients happy and satisfied, you will avoid a major source of revenue leakage. Our experts can help with any questions you have about plugging your revenue leaks.

For more information, contact Amanda Gutierrez at [email protected], or call her at 312.670.7444. Visit ORBA.com to learn more about our Health Care Group.

Extend Your Reach with Non-Physician Providers
Jason Flahive, CPA

Most physicians are stretched to maximum capacity in terms of time and effort devoted to their patients, and often, it still isn’t enough. One way to improve patient services, increase patient satisfaction and optimize physician utilization is to hire non-physician providers (NPPs) to fill in the gaps.

PAs and NPs

There are two primary categories of NPPs: physician assistants and nurse practitioners. Which category is best for your practice depends on which is licensed in your state and the range of activities they are permitted to perform.

An NPP may be able to function independently or work under a doctor’s supervision, depending on relevant state law. Typical services that an NPP of either type may provide include:

  • Coordinating health education, patient counseling and patient care;
  • Ordering and/or performing diagnostic and therapeutic procedures;
  • Arranging patient referrals;
  • Delivering on-call care;
  • Performing physical exams;
  • Taking patient histories; and
  • Contributing to clinical decision making.

Discuss with your physicians which services they would be willing to surrender to an NPP. From there, calculate the appropriate number of NPPs to meet the practice’s needs, and establish benchmarks to evaluate NPP performance.


The most direct way to find good NPP candidates is through job listings on the websites of local and national associations for physician assistants and nurse practitioners. (Check out the American Academy of Physician Assistants and the American Association of Nurse Practitioners.) Old-fashioned campus recruiting at local schools with PA and NP programs can also provide a steady stream of candidates.

Once you have found and hired your NPPs, you will need to introduce them to two critical constituencies: physicians and patients. It is important to clearly define the roles for physicians and NPPs and document applicable standing orders, protocols, collaborative agreements and supervision agreements. Also, consider sending letters to patients explaining the hire of NPPs and the role they will play.

Medicare Billing

An NPP can bill Medicare for services in two ways:

  1. “Incident to” a physician’s care, using the doctor’s National Provider Identifier (NPI); or
  2. Directly after being credentialed by Medicare, using the NPP’s own NPI.

Under the first option, after an initial visit by a doctor, the NPP can provide services under the physician’s direct supervision, or while the doctor is available in the office to give immediate assistance. To continue billing subsequent visits with the NPP as “incident to,” the physician must actively participate in and manage the patient’s treatment, with commensurate documentation in the patient’s medical record.

Unless all of an NPP’s services fall within the “incident to” definition, the NPP must use the second option, that is, to enroll in Medicare, obtain an NPI and bill directly. NPPs who bill directly receive lower reimbursements than when they bill “incident to.” It is 85% of the full physician fee schedule rate versus 100%.

Commercial Billing

Private commercial payers have their own rules about reimbursing NPP services. They usually apply separate criteria for credentialing NPPs, sometimes not allowing them to bill directly.

Plus, they typically reimburse NPPs at lower rates than for supervising physicians. Your practice must bill under the doctor’s NPI and follow the billing guidelines in the payer’s provider manual. And, you may need to append certain modifiers to the bill to correctly identify the NPP and supervising physician providing the care together.

Proceed with Caution

Failure to satisfy the billing requirements of either Medicare or a private payer can create serious compliance problems for a practice. Regularly consult the websites of the Centers for Medicare and Medicaid Services and relevant private insurers to stay up to date on NPP billing rules.

NPPs are not right for every practice. However, if handled well, they can serve both patients’ and physicians’ needs, leading to better allocation of therapeutic resources. For busy physicians in a growing practice, NPPs are a viable option to consider in their efforts to improve patient care.

For more information, contact Jason Flahive at [email protected], or call him at 312.670.7444. Visit ORBA.com to learn more about our Health Care Group.

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