Fluctuations in insurance reimbursement is not new to the mental health and substance abuse industry – especially for out-of-network providers. That’s why it’s critical for your behavioral health facility to not only have access to detailed reporting, but the ability to recognize inconsistencies in payments, and the manpower to appeal and follow-up on low-paying claims.
Many factors go into identifying a low-paying claim. Because each patient’s policy is unique, it is critical to get detailed and up-to-date benefit information BEFORE the patient admits into your facility. To ensure this takes place, write it down and make sure that it is accessible for your reference every time you post a payment. The best way to do this is to load the information into your billing software. Set an alert or pop up that tells you if the patient’s deductible has been met and that the policy pays 80 percent of billed charges until the out-of-pocket has been met. That way, if you receive an EOB that applies a payment to the deductible when the deductible has already been met, you quickly identify the error and send the claim back for reprocessing.
See our case study below observing Datapro Billing
In a sample of 100 random claims across all payers, Datapro found that 11 claims were not paid according to the benefit that was quoted prior to the patient admitting.
Processing Issue Total Amount Saved
Co-insurance / copay.
Inconsistent payments for same member
Deductible: Four claims were inappropriately applied to the patient’s deductible when the deductible had already been met. In three of the four deductible cases, the entire allowed amount was applied to the patient’s deductible when the deductible had already been met.
In the final case, the patient’s insurance company applied the patient’s out-of-network deductible ($6000) instead of the in-network deductible ($3000).
Co-insurance/Copay: The most common inconsistency we found out of 100 randomly selected claims has to do with patient co-insurance and copays. In one example, the insurance should have paid 80 percent, leaving 20 percent to patient responsibility. However, they paid the opposite. Out of $1000, the insurance only paid $200 when they should have paid $800. Once identified, this was simple to correct. However, without a critical eye, incorrect payments go unnoticed and behavioral health facilities risk leaving money on the table.
One claim out of the 100 randomly selected claims was processed incorrectly, but to the benefit of the patient / facility. The patient’s out-of-pocket was not met and the insurance company paid 100 percent of the allowable. After looking deeper into this patient’s account, we found that almost all the patient’s claims processed incorrectly. In total, the insurance company paid $1,200 that should have been patient responsibility.
Although it can be tempting to keep the overpayment, insurance companies now use auditing software and will likely request their money back.
They have a year to do so unless otherwise stated in your contract. Rather than receiving a refund request down the line, we recommend sending the money back and pursuing the member for their portion.
The most common type of co-insurance / copay processing issue comes from the insurance company applying the incorrect copay/co-insurance amount altogether. Therefore, it is critical to have access to the patient’s benefit information (ie. Deductible, copay, co-insurance accumulations) when you post payments.
Payment Inconsistencies: Another common type of claim processing problem that can lead to major cash collection (if recognized) is inconsistency in payment by a third-party pricing company. For example, Datapro was able to get 27 claims repriced for one patient’s PHP treatment. The claims were originally priced by Data Isight at $150.12 per day and through the appeal process, Datapro was able to get an increase to $1,200 per day.
Unfortunately, not all behavioral health claims that are priced by a third-party are eligible for repricing. This depends on how the plan is written. Pricing information can be found by looking in the members plan documents. These are usually difficult to come by, but most insurance representatives can provide you with the information.
Over a three-month period at one substance abuse outpatient program, 62 out of 160 appealed claims were eligible for repricing. This led to $43,676 in additional payment.
On average in 2021, Datapro was able to capture additional revenue for one third of low-priced claims.
How-to Appeal Low Paying Claims
When you notice a claim paid below what is usual and customary (UCR), the first thing you should do is call the payer and find out who priced the claim. The most common third-party pricing companies that we have seen lately are Data Isight, Viant, Multiplan and Aetna Global Claim Services. Each pricing company has a slightly different appeals process that you must follow. Contact Datapro for information on each company’s specific process.
Regardless of which third-party pricing company you appeal to, you will need the following information to complete the appeal:
Insurance ID #
Date of Service
As with all insurance billing and collections, the most critical part is consistent follow-up. The appeal process should take no more than 30 days for a response. If the appeal is approved and your claim is repriced, allow an additional 30 to 45 business days.
Although insurance reimbursement can be difficult to predict, there are ways to combat inconsistencies and get the insurance reimbursement that you deserve. It takes an experienced billing team to identify, appeal and successfully get claims repriced. If you think that your behavioral health facility may be leaving money on the table, we can help.
Contact us for a complimentary accounts receivable audit and unpaid claims review