A write-off is an amount that a practice deducts from a charge and does not expect to collect, thereby “writing it off” the accounts receivable or list of monies owed them by payers or patients.
There are lots of reasons why write-offs are taken, and it is common practice to divide write-offs into two major categories.
Necessary or Approved Write-offs
These are write-offs that you have agreed to, either in the context of a contract, or in terms of your practice philosophy.
Contractual write-offs are the difference between the practice fee schedule and the allowable fee schedule you’ve agreed to accept.
Charity write-offs are the difference between the practice fee schedule and anything collected. Charity write-offs may be in accordance with a community indigent care effort, a policy adhered to in a faith-led healthcare system, or a financial assistance program.
Small balance write-offs are amounts left on the patient’s account that may not warrant the cost of sending a bill, which has been estimated to cost about $12.00 each, taking into account the statement process, as well as the cost to receive the check, post it, and deposit it. Many practices write off the small balance (usually $15 or less) and collect it when the patient returns. Others run a special small balance statement run once a quarter.
Last week the U.S. Department of Health and Human Services (HHS) announced a new initiative to help improve care for patients while they are in the hospital and after they are discharged. Doctors, hospitals, and other health care providers can now apply to participate in a new program known as the Bundled Payments for Care Improvement initiative (Bundled Payments initiative). Made possible by the Affordable Care Act, it will align payments for services delivered across an episode of care, such as heart bypass or hip replacement, rather than paying for services separately. Bundled payments will give doctors and hospitals new incentives to coordinate care, improve the quality of care and save money for Medicare.
“Patients don’t get care from just one person – it takes a team, and this initiative will help ensure the team is working together,” said HHS Secretary Kathleen Sebelius. “The Bundled Payments initiative will encourage doctors, nurses and specialists to coordinate care. It is a key part of our efforts to give patients better health, better care, and lower costs.
Payment bundling is the future
In Medicare currently, hospitals, physicians and other clinicians who provide care for beneficiaries bill and are paid separately for their services. This Centers for Medicare & Medicaid Services (CMS) initiative will bundle care for a package of services patients receive to treat a specific medical condition during a single hospital stay and/or recovery from that stay this is known as an episode of care. By bundling payment across providers for multiple services, providers will have a greater incentive to coordinate and ensure continuity of care across settings, resulting in better care for patients. Better coordinated care can reduce unnecessary duplication of services, reduce preventable medical errors, help patients heal without harm, and lower costs.
The Bundled Payments initiative is being launched by the new Center for Medicare and Medicaid Innovation (Innovation Center), which was created by the Affordable Care Act to carry out the critical task of finding new and better ways to provide and pay for health care to a growing population of Medicare and Medicaid beneficiaries.
Four bundled payment models
Released today, the Innovation Centers Request for Applications (RFA) outlines four broad approaches to bundled payments. Providers will have flexibility to determine which episodes of care and which services will be bundled together. By giving providers the flexibility to determine which model of bundled payments works best for them, it will be easier for providers of different sizes and readiness to participate in this initiative.
In a traditional healthcare setting, the revenue cycle begins with the insurance companies who pay the majority of the bill. There are multitudes of payers and each payer can have many plans. How can a healthcare organization catalog this information, keep this information updated and make this information easily accessible to staff so they can discuss payments with patients in an informed and confident way?
Start by breaking your payers into five main categories as a logical way to organize the data.
- Payers with whom you have a contract
- Payers with whom you do not have a contract
- State and Federal government payers (Medicare, Medicaid, TriCare)
- Medicare Advantage payers
- Patients
Payers with whom you have a contract
Your organization has signed a contract with a payer and you have agreed to accept a discounted fee called an allowable, and to abide by their rules. What is the information you need to collect?
- A copy of the contract
- A detailed fee schedule, or a basis for the fees, such as 150% of the 2008 Medicare fee schedule.
- Any information about the fees being increased periodically based on economic indicators, or rules (notification, timeline, appeals) on how the payer can change the fee schedule.
- The process and a contact name for appealing incorrect payments.
- Information on what can be collected at time of service. Hopefully your contract does not have any language that prohibits collections at time of service, but you must know what the contract states.
- Process for checking on patients eligibility and benefits: representative by phone, interactive voice response (IVR), website or third-party access.
First the facts on what has taken place so far in the 2011 EHR Incentive Programs.
- As of June 30th, the total of Medicare EHR Incentive Program payments is over $94 million.
- As of June 30th, over $166 million has been paid in Medicaid EHR incentives since the program began in January. In May and June, four states launched Medicaid EHRIncentive Programs – Indiana, Ohio, Pennsylvania, and Washington, bringing the total states with Medicaid EHR Incentive Programs to 21. More states will launch in July.
- There are 68,001 active registrations of eligible professionals and eligible hospitals for the Medicare and Medicaid EHR Incentive Programs.
If your group hasn’t received a check and hasn’t registered for the Medicare or Medicaid Incentive Program, then this blog post is for you! For anyone who is really just beginning their EHR journey, today’s presentation clarified previous information given by CMS, as well as giving listeners new information about the programs.
Today’s CMS Open Door Forum was a good one. The slides (pdf here), although reviewed quickly during the call, are a comprehensive resource for anyone needing in-depth information on qualifying for incentives through PQRI. The information is complex, but anyone can start the process tomorrow and successfully get their check (next year.)
PQRI has been renamed PQRS.
These are the key points of the information presented:
- You can tell if you are eligible for the incentive program by checking the main PQRS site here. Scroll down to Downloads and click on “List of Eligible Professionals.”
- There is no registration required to report quality data.
- PQRS should not be confused with incentives offered for ePrescribing or meaningful use of a certified Electronic Health Record – these are three distinct systems.
- There are new Physician Quality Reporting Measure Specifications every year – use the correct year.
- Reporting can be done as individual eligible providers or as groups, however groups needed to be self-nominated by January 31, 2011, so that door is closed for this year.
- Eligible providers can choose to report for 12 months: January 1December 31, 2011 or for 6 months: July 1-December 31, 2011 (claims and registry-based reporting only.)
- There are two reporting methods for submission of measures groups that involve a patient sample selection: 30-patient sample method and 50% patient sample method. An intent G-code must be submitted for either method to initiate intent to report measures groups via claims. If a patient selected for inclusion in the 30-patient sample did not receive all the quality actions and that patient returns at a subsequent encounter, QDC(s) may be added (where applicable) to the subsequent claim to indicate that the quality action was performed during the reporting period.
Physician Quality Reporting analysis will consider all QDCs submitted across multiple claims for patients included in the 30-patient samples. - Eligible professionals who have contracted with Medicare Advantage (MA) health plans should not include their MA patients in claims-based reporting of measures groups using the 30 unique patient sample method. Only Medicare Part B FFS patients (primary and secondary coverage including Railroad Medicare) should be included in claims-based reporting of measures groups.
- Choose which group measures OR individual measures (3 minimum) you want to report on based on your method of reporting. Review your choices here.
- If you plan to report using a registry or EHR, make sure the systems are qualified by checking here.
- Here is the schedule for PQRS incentives and “payment adjustments” (financial dings.)
- Incentives (based on the eligible professionals or groups estimated total Medicare Part B PFS allowed charges)
- 2007 1.5% subject to a cap
- 2008 1.5%
- 2009, 2010 2.0%
- 2011 1%
- 2012, 2013, 2014 0.5%
- Payment Adjustments (you lose money)
- 2015 98.5%
- 2016 and subsequent years 98.0%
What follows are the Questions and Answers from the listeners.
Q: Do PQRS measures need to be reported once per encounter or once per episode?
A: It depends on the measure. Check the list to see what each measure requires.
Q: Is there a code to submit if we cannot qualify due to low numbers of Medicare patients?
A: No, CMS will calculate this and will know you cannot qualify and you will be exempt from the payment adjustment.
Q: Can both admitting physicians and consulting physicians submit the same quality codes?
A: Yes, all eligible providers working with a patient can report the same code if appropriate.
Q: How do we know if we qualified for the eRx incentive for 2010?
A: Payments will come early fall and feedback reports will be available that break down each provider’s incentive.
Q: For the eRx incentive, is it 10 eRxs before June 30, 2011 and 25 before January 31, 2011 for each PROVIDER or each PRACTICE?
A: Each provider.
Q: What is the difference between the numerator and the denominator in PQRS?
A: The numerator is the clinical quality action (for instance, putting a patient on a beta blocker) and the denominator is the group of patients for whom the quality action applies (which patients with appropriate diagnoses are eligible for beta blocker therapy.)
Q: Do all the preventive measures in this group have to be utilized?
A: Not all measures will apply to all patients, for instance mammograms for females only.
Q: Is there a code to be placed on the claim that says a measure is not applicable for this patient?
A: No.
Q: How do you know if a measure code on a claim has been accepted?
A: You will receive a rejection code on your EOB that indicates the code was submitted for information purposes only. Remittance Advice (RA) with denial code N365 is your indication that Physician Quality Reporting codes were passed into the National Claims History (NCH) file for use in calculating incentive eligibility.
Q: How can a new provider get started with quality reporting?
A: Any provider can start any time by reporting through claims, a registry or an EHR.
Q: Should providers bill for PQRI under their individual number or under their group number?
A: Under their individual number.
Q: Can a physician delegate the eRx process to a staff member, just as they might have a nurse write a prescription for them?
A: Yes.
Q: Can you clarify the three incentive programs and which a practice can participate in at the same time?
A: The Physician Quality Reporting System, eRx Incentive Program, and EHR Incentive Program are three distinctly separate CMS programs.
The Physician Quality Reporting System incentive can be received regardless of an eligible professional’s participation in the other programs.
There are three ways to participate in the EHR Incentive Program: through Medicare, Medicare Advantage, or Medicaid.
If participating in the EHR Incentive Program through the Medicaid option, eligible professionals are able to also receive the eRx incentive.
If participating in the Medicare or Medicare Advantage options for the EHR Incentive Program, eligible professionals can still report the eRx measure but are only eligible to receive one incentive payment. Eligible professionals successfully participating in both programs will receive the EHR incentive.
Eligible professionals should continue to report the eRx measure in 2011 even if their practice is also participating in the Medicare or Medicare Advantage EHR Incentive Program because claims data for the first six months of 2011 will be analyzed to determine if a 2012 eRx Payment Adjustment will apply to the eligible professional.
If an eligible professional successfully generates and reports electronically prescribing 25 times (at least 10 of which are in the first 6 months of 2011 and submitted via claims to CMS) for eRx measure denominator eligible services, (s)he would also be exempt from the 2013 eRx payment adjustment.
The transcript and a recording of today’s call will be posted on the CMS website within a few weeks.
Image via Wikipedia
Image via Wikipedia
Image via Wikipedia
Note: see my latest post on registering and attesting for the EHR Incentive Program here.
Registration opens on January 3, 2011 for the Medicare and Medicaid EHR Incentive Programs
- Register as soon as possible after January 3, 2011.
- You can register before you have a certified EHR, but you will have to have an EHR when you attest.
- You can register even if you do not have an enrollment record in PECOS.
- A link to the Incentive Registration will be available here when it is published.
- Not all states will be ready to participate in the Medicaid program on January 3rd. Information by state is here.
What do you have to have to register?
- A National Provider Identifier (NPI) All eligible professionals, eligible hospitals, and critical access hospitals (CAHs) must have a National Provider Identifier (NPI) to participate in the Medicare and Medicaid EHR Incentive Programs.
- An enrollment record in the Provider Enrollment, Chain and Ownership System (PECOS) All eligible hospitals and Medicare eligible professionals must have an enrollment record in PECOS to participate in the EHR Incentive Programs. Eligible professionals who are only participating in the Medicaid EHR Incentive Program are not required to be enrolled in PECOS. If you do not have an enrollment record in PECOS, you should still register for the Medicare and Medicaid EHR Incentive Programs.
- CMS Identity and Access Management (I&A) User ID and Password
- Eligible Professionals: Eligible professionals can use the same User ID and Password they use for the National Plan and Provider Enumeration System (NPPES). This is also the same User ID and Password that is used to access PECOS. If you do not have an active User ID and Password for NPPES or PECOS, request them here. You will need your type 2 NPI, your Taxpayer Identification Number (TIN), and your address from IRS Form CP-575. You will also need to mail a copy of IRS Form CP-575 as directed.
- Hospitals/Critical Access Hospitals: Authorized Officials can use the same User ID and Password they use to access PECOS. If you do not have an Authorized Official with access to PECOS, request a User ID and Password here. You will need your type 2 NPI, your Taxpayer Identification Number (TIN), and your address from the IRS Form CP-575. You will need to mail a copy of the IRS Form CP-575 as directed. Additional hospital staff will need to request access to the “EHR Incentive Programs” application here and be approved by the Hospital’s Authorized Official.
What else do you need to know about registration?
Hospitals:
- Hospitals that are eligible for EHR incentive payments under both Medicare and Medicaid should select “Both Medicare and Medicaid” during the registration process, even if they plan to apply only for a Medicaid EHR incentive payment by adopting, implementing, or upgrading certified EHR technology. Dually-eligible hospitals can then attest through CMS for their Medicare EHR incentive payment at a later date, if they so desire. It is important for a dually-eligible hospital to select “Both Medicare and Medicaid” from the start of registration in order to maintain this option.
- Hospitals that register only for the Medicaid program (or only the Medicare program) will not be able to manually change their registration (i.e., change to “Both Medicare and Medicaid” or from one program to the other) after a payment is initiated and this may cause significant delays in receiving a Medicare EHR incentive payment.
Eligible Professionals:
- Eligible professionals eligible for both the Medicare and Medicaid EHR Incentive Programs must choose which incentive program they wish to participate in when they register.
- Before 2015, an eligible professional may switch programs only once after the first incentive payment is initiated. Most eligible professionals will maximize their incentive payments by participating in the Medicaid EHR Incentive Program.
The Electronic Health Record (EHR) Information Center is open to assist the EHR Provider Community with inquiries.
Hours of operation are:
8:30 a.m. 4:30 p.m. (Central Time) Monday through Friday (except federal holidays)
1-888-734-6433 (primary number) or 888-734-6563 (TTY number)
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The CLIA regulations require a facility to be appropriately certified for each test performed. To ensure that the Medicare and Medicaid programs only pay for laboratory tests categorized as waived complexity under CLIA in facilities with a CLIA certificate of waiver, laboratory claims are currently edited at the CLIA
certificate level.
All CLIA waived tests here (pdf.) – updated July 6, 2010
The Center for Healthcare Transformation may not be my organization of choice, but they’ve put together an excellent timeline of the PPAC (Patient Protection and Affordable Care Act), also called the ACA or Affordable Care Act.
The timeline shows what’s happening in regards to Medicare, Medicaid, public health, insurance, Indian health, taxes and government programs. You can slide the timeline forward or backward and jump around in hourly, daily, weekly, monthly, quarterly, yearly, etc. increments. It gives you a wonderful sense of the Big Picture. It is also being constantly updated.
And, for a quick look at the ACA changes happening as of September 23, 2010, you can watch a short video that I made for the “? of the Day” tab above. I thought this tab was getting just a bit boring, so I thought I would post short animations there that readers could share with staff or whomever for infotainment. I posted the first video under the “? of the Day” tab and also here for your convenience.
GoAnimate.com: Jack Asks About Healthcare Reform by Mary Pat Whaley
Note: read my latest post on getting the EHR Incentives here.
Medicare Definition of Eligible Provider (EP)
For Medicare, physicians and some hospitals are eligible providers. “Physicians” includes doctors of medicine (MD) or osteopathy (DO), dentists or dental surgeons (DDS or DMD), podiatric medicine (DPM), and optometry (OD) and chiropractors (DC).
For providers, their annual payment will be equal to 75 percent of Medicare allowable charges for covered services in a year, not to exceed the incentives in the table below. Payments will be made as additions to claims payments.
Hospitals include quick-care hospitals (subsection-d) and critical access hospitals and only includes hospitals in the 50 States or the District of Columbia.
Medicaid Definition of Eligible Provider (EP)
Medicaid takes the Medicare definition of eligible providers (physicians) and adds nurse practitioners, certified nurse midwives and physician assistants, however, physician assistants are only eligible when they are employed at a federally qualified health center (FQHC) or rural health clinic (RHC) that is led by a Physician Assistant. Eligible hospitals include quick care hospitals and children’s hospitals.
At minimum, 30 percent of an EPs patient encounters must be attributable to Medicaid over any continuous 90-day period within the most recent calendar year. For pediatricians, however, this threshold is lowered to 20 percent.
The first year of payment the Medicaid provider must demonstrate that he is engaged in efforts to adopt, implement, or upgrade certified EHR technology. For years of payment after year 1, the Medicaid provider must demonstrate meaningful use of certified EHR technology.
Change 1:
The definition of “hospital-based physician” was recently clarified to include physicians working in hospital outpatient clinics (employed physicians) as opposed to the inpatient units, surgery suites or emergency departments. This still excludes pathologists, anesthesiologists, ER physicians, hospitalists and others who see most of their patients in the ER as outpatients or as hospital inpatients.
Possible Change 2:
The Health Information Technology Extension for Behavioral Health Services Act of 2010 (HR 5040) is a bill in the US Congress originating in the House of Representatives that would amend the Public Health Service Act and the Social Security Act to extend health information technology assistance eligibility to behavioral health, mental health, and substance abuse professionals and facilities, and for other purposes. You can track the bill here.
For more information on stimulus money for meaningful use of an EMR, read my post here.
- Everyone is waiting for the other shoe to drop on Medicare payments.
- Private practices may not have the in-house expertise to implement an EMR and may not be able to afford a consultant (although some states are receiving grants to help practices – check your state’s grant here.)
- There is a lot of confusion on the parts of Meaningful Use that have been clarified and of course, on those that haven’t.
- Administrators are distracted by RAC, PECOS, HIPAA , PQRI, eRx and RCM.
- Some practices have spent years avoiding Medicare and Medicaid patients and now don’t have the patient numbers to participate.
- Everyone and their uncle is selling an EMR – who can tell the long-timers who are about to be bought from the short-timers who might last forever?
- Physicians are worried about the drop in production that (some say) happens when a practice launches an EMR.
- There seems to be as many horror stories as there are success stories with EMRs.
- Practices that are affiliated with a hospital are nervous about tying themselves to the hospital in such a serious way as hopping on their EMR package.
- Because two practices can have absolutely opposite experiences with the same EMR, no one can find consistent recommendations for any single product. (It’s not the product, it’s the implementation!)
- Bonus Reason: lots of people are confused about how to qualify for the ARRA money (read my post about this here.)
