LTC Expert Article: Collect More on Medicare Claims

What if I told you that it is very likely you are sitting on a treasure trove of money that rightly belongs to you and you don’t even know it? This is the case with many long term care facilities today that are on the verge of losing the ability to collect on their Medicare claims.

You may already know that the Centers for Medicare & Medicaid Services (CMS) imposes a “Medicare Timely Filing Deadline” on all Medicare claims. Too often these claims are not reimbursed due to simple errors and get pushed to a backlog to deal with later. These claims then turn into “bad debt” and a financial risk on the facilities. They also affect the ability to collect on co-insurance and any future Medicare claims due to the sequential filing rule which causes a cascade effect of unpaid at-risk claims. You can still file claims if previous ones haven’t been paid, but they will be placed on hold or out-right rejected.

Don’t leave your money on the table.

The good news is that you still have time to re-submit and collect on these Medicare claims. First, you need to identify how much is at risk by performing an extensive analysis of your claims – here’s how:

• Work your Aging. The easiest way to start is to run your Aging reports from your financial system. This will give you an idea as to how much money may be at stake. It will also show you items that might not have ever been billed to Medicare. Use your Aging reports as your base of operations for the remainder of the project.
• Take a fine-toothed comb to your Census. Once you know which claims are at risk, look deeper into your financial and admissions software to review your census details more closely. Often times, you can make minor corrections to your census in order to easily resolve the problem.
• Compare the “He-said; She-said” between your records and Medicare’s. If you don’t already have access to a Direct Data Entry (DDE) system for Medicare, get one immediately. This allows you to log in securely straight into the Federal government’s Medicare database for your facility and see the status of all of your claims in real-time. Cross-check your research findings with the information in the system. Often, you’ll be able to see what issue has prompted your claim to be suspended or pushed back for correction.
• Clear out the claims cobwebs. You may have older claims pre-dating the timely filing period which were not properly processed and are still hanging in the balance. Normal logic would dictate that you shouldn’t worry about those, but you do need to process these through Medicare in order to get a rejection on them. Doing so won’t give you any more money directly, but it will allow you to then submit future claims that are within the timely filing deadline.

How one community succeeded.

Case in point, one community (which shall remain nameless) was able to prove an immediate and complete return on investment (ROI) through this method. From just one of their facilities, they were able to identify approximately $800,000 worth of claims that would turn to bad debt at the end of this year. They estimated that approximately $700,000 could be recovered and began the process of working with their software vendor to do this. In the first few weeks of the project, they had already recovered over $300,000 worth of claims from their original research. Incredibly, because of the Medicare sequential filing cascade effect this translated to just shy of $1 million of extra money. The money recovered went straight to their bottom line as it had previously been considered “lost”! Needless to say, they’re now following this same process in another facility.

This kind of success can be your own by implementing a similar system. However, you’ll also want to ensure that going forward you are not caught in this bear trap again! After all, next year’s deadline is already ticking away!

“An Ounce of Prevention is Worth a Pound of Cure.” – Ben Franklin

Never had truer words from an inventor, entrepreneur and military strategist been spoken or been so applicable to long term care! Missing the timely filing deadline or running the fire drill just before this cut-off is easily preventable for LTC facilities by following some common rules of engagement:

• Align your troops. Having the right dynamic of teamwork between your Admissions, Billing and MDS staff is critical to your success. Ensure that each of them is properly trained and up-to-date on procedures and understand the bigger picture of how their role impacts the organization. For example, your Admissions staff should verify insurance on every resident, every time. They must also check for prior Medicare stays, which is a very common and easily avoided error often found in these types of claims. Additionally, the MDS staff needs to communicate with the Admissions and Billing staff to ensure that census records and MDS Assessments as well as other changes related to a Medicare stay are properly captured and correct for each resident, every day. Missing just one day can mean a rejected claim or a claim that is paid inappropriately which costs you money. There is a direct correlation between effectively tracking census details and not missing out on revenue. Finally, your billing staff isn’t there to just push papers; they need to become ultimately responsible for the overall health of claims which includes developing the right inter-departmental relationships and understanding with other areas of your facilities.

• Have the right arsenal. Because claims are affected by so many different areas of your organization, you must have the right tools in place that allow your staff to efficiently research information and resolve issues. At a minimum, your billing, financial, admissions, census and MDS systems must be unified. Otherwise, you run the very real risk of spending more time trying to find information than would be sensible. If you’re one of the lucky ones to have such an integrated solution, your job has become infinitely easier. You should have the capability to quickly access your Aging reports, cross check your Census, review the MDS leading to that claim and retrieve the full history of the Resident’s account all from the comfort of your desk chair. If you don’t have this capability, then you should start looking for it immediately because every day you aren’t up-to-speed on your billing is more money forfeited by your organization.

• Call in the cavalry. Even the best of the best need help sometimes. When you’re finding that your time is diverted to other issues, turn to your vendors for assistance. A good vendor is not just someone who sold you some software once, but a company that cares about your organization and is willing to step in and help when needed. It might be a little more costly than trying to do it yourself, but you can be sure that it will get done correctly and you can count on the ROI paying for itself. Look for these added services in partners that are larger and better established. An additional benefit you won’t find with other third parties that offer a similar service is that your software partner will already be familiar with your software systems! You don’t need to hand-hold them through it and can pretty much set them loose to work on getting you results.

Kim Henry is a billing Implementation & Training Specialist at AOD Software with over 20 years experience in Accounts Receivable and extensive LTC billing knowledge.  

An edited version of this article was published in the January/February 2010 issue of Advance for Long Term Care Management Magazine.