EMS service providers are sometimes lured in by ambulance billing companies who promise extremely low commission rates and reimbursement guarantees that are “too good to be true.” Making the wrong hiring decision can have devastating results for service providers, patients and in many cases, the taxpayer. When an ambulance billing services company gets it wrong, they expose clients to lost revenues, patient complaints and even litigation. It doesn’t have to be that way.
At Emergicon, we believe in getting it right the first time. Our clients depend on our team’s 70 years of collective experience in ambulance billing to secure reimbursement effectively and compassionately. We make sure our clients get the best rate of reimbursement possible and that they enjoy the best customer service along the way.
Whether you choose us or not, we want to arm you with the following tips.
What you need to know before hiring an EMS billing agency
After the 911 call, after the lights and sirens, after the adrenaline stops, after the patient and their family has been calmed, after the patient care report, how do you really know that the company you are about to hire to secure reimbursement for those ambulance services you provided will have your best interests at heart and is capable of doing the job? Just because a billing company offers the lowest commission rates or has the latest electronic charting, does not mean they know how to collect money.
We’ve outlined some tips to help you better understand what you should expect from a reputable and capable ambulance billing services company. These tips could help you recoup money, avoid litigation, and end patient complaints.
1) Days to bill
“Days to bill” is a key identifier of your billing company’s efficiency. Days to bill is calculated as the number of days from the receipt of your run report by your billing company to the day they send it out. A reasonable goal is no more than five days. While same-day billing is possible for departments using electronic patient care reporting, five days to bill is not unreasonable. If your potential billing company is running 20, 35 or even 50 days to get a bill out the door, there is a problem. We believe that it’s important to send the claim as soon as possible to ensure a timely reimbursement. Days to bill should be approximately 5 days. If you’re considering an ambulance billing company, ask them about their average “days to bill.”
2) Commercial insurance payments
The single most common mistake a billing company makes is to accept commercial insurance payments “as-is,” without ever questioning the payor. More often than not, the commercial insurance payment is posted and the remaining unpaid portion of the bill is erroneously sent to the patient. This means the provider has not only accepted a payment for less than what was due, but it has also likely irritated the patient by sending them a bill with an incorrect amount due. Commercial insurance companies use a variety of methods to determine ambulance payments and sadly, the first payment the insurance company sends is often incorrect for one of many reasons. Keep this in mind: as a 911 provider in your area, you are due 100% of your charges less any applicable copays or deductibles. You are not “an out of network provider!” You are not subject to their managed care payment schedule! If an ambulance billing company sends an incorrect bill to the patient, it is unfortunately you, the provider, facing an angry patient or family member. A reputable and capable company with knowledgeable staff will be squarely focused on securing the correct amounts due by each party, whether it is the insurance company, the patient, or Medicare and Medicaid.
Managing denials is probably second only to collecting money when it comes to expectations of your billing company. Denials happen for a variety of reasons and each
payor is different. Medicare and Medicaid are the strictest when it comes to handing out denials and the consequences of violating their rules are the most severe. The fact is that for a 911 provider, denials are often the result of a poor process by the billing company. Improper coding will lead to a denial, but more often denials are a result of a sloppy process. Incorrect spelling of the patient’s name, wrong date or birth and wrong Medicare or Medicaid number can all be corrected before the first bill is ever sent. If the billing company has a lot of denials, more often than not, they aren’t being careful and they are making preventable mistakes. These billing errors can mean lengthy delays in reimbursement and sometimes no reimbursement at all. A reputable company will be properly staffed with experienced professionals who make it a priority to send your bills in a timely and accurate manner.
4) Claim follow-up
It is true that the squeaky wheel gets the grease. Insurance companies are not sitting idle, waiting to cut checks to providers. The one thing that a billing company should do very well is have consistent and timely follow-up on claims. A good follow-up process identifies that the claim was received, that the claim is in process and that a denial or payment is pending. A good follow-up process, coupled with consistent reviews of your department’s outstanding claims, ensures that your billing company pursues every claim to satisfactory resolution and does not just work the new claims coming in the door. This takes time and it takes human beings. Automation is fine, but we, at Emergicon, believe a client’s reimbursement rate is directly related to a highly experienced team and the care it takes with all ambulance claims it processes and collects. There’s nothing like the human touch.
5) Days to payment
Similar to days to bill, days to payment is another indicator of a billing company’s overall performance. The fact is that Medicare pays fourteen days after a transport claim has been received electronically. Commercial insurance pays typically forty-five days after the date of service. Ask your potential new partner in EMS billing if their Medicare reimbursement averages are much more than fourteen days. If they are, you need to ask why. If commercial insurance averages are more than forty-five days, there is a problem in the follow-up process.
The next five tips are geared towards understanding and interpreting a billing company’s reports. Each month, an ambulance services provider should review their billing company’s reports and ask questions about what they are seeing. They shouldn’t be afraid to ask for new or custom reports that are meaningful and easy to understand. A representative from a reputable and capable billing company should be happy to sit down and explain the reports to their clients. If the month end reports aren’t understandable, they are not useful and are a waste of time and paper.
6) Calculating collection percentage
Collection percentage has to be the single biggest cited number by anyone trying to estimate their billing company’s performance. The difficulty is that not only does a department with a 20% Medicaid mix versus a 5% Medicaid mix vary greatly; many billing companies do not calculate the percentage correctly. A more meaningful number is the average cash collection per patient [CPT]. That is, the total dollars collected in a period divided by the total transports for the same period. Is that number more than Medicare allowable? If not, that means you are not effectively maximizing insurance revenue. Does that number climb over time or does it fall? Any billing company worth the commission you pay them should increase the CPT incrementally over time.
7) Accounts receivable
The Accounts Receivable report is probably the single most useful report when it comes to evaluating billing company performance. This report should have payors listed down the left hand side and columns of Current Account Receivables, 31 – 60 days old, 61 – 90 days old, 91 – 120 days old, 121 – 180 days old and 180+ days old. This report is a monthly snapshot of all your claims activity. The older the claim becomes, the less collectible they are and the greater the indication that the billing company has poor follow-up. A reputable and capable billing company would be able to provide these reports in detail (by transport). Ask questions about accounts that are older than 90 days. When was the last contact made with the payor or patient? When is resolution expected? Pay particular attention to the row labeled Self Pay or Private Pay. Most billing companies dump claims into this category when they are waiting to identify a payor. A better method is to separate your patients that owe deductibles and coinsurance from those that truly have no identified insurance.
8) Gross charge schedule
A good billing company should be able to provide its clients with an annual recommendation to their EMS fee schedule. Every year, Medicare makes an adjustment to the ambulance fee schedule. Insurance companies raise premium rates every year and the cost of fuel, supplies and medicine never drops. It should be asked, “Then why do many departments not routinely review and adjust their ambulance fee schedule?” Most likely, it’s because ambulance fees are set by city ordinance or resolution and changing the rates are difficult. Your billing company should not only provide you with the latest Medicare and Medicaid rates, but the rates of other ambulance providers as well. Your billing company should calculate what each change in base rate and mileage will translate to, in terms of cash collections to your department. You should expect this kind of customer service and guidance from a reputable and capable ambulance billing services company.
9) Identify a goal
Each year your department has to set a budget for ambulance collections. As mentioned in Tip #8, each year brings about a new Medicare schedule not to mention your annual increase in base rate and mileage. So, how do you know if last year’s budget of $250,000 in ambulance fees is sufficient? Should your collections budget be increased 2-3% like Medicare? Should your ambulance collections increase in the coming year in proportion to the base rate and mileage increase? Include your billing company in your department’s budgeting process and have them give you the answers. Further, once your budget is set, make your ambulance collections budget a billing company goal. You should expect to work with your billing company and track their progress each month versus your budgeted cash collections for that month. Your billing company should have no problem explaining in writing any significant overages or underages.
10) Get what you pay for
Second only to collection percentage is the oft-touted commission fee percentage. Commission rates can vary greatly and providers should be wary of ones that seem too good to be true. The only way to make a low commission profitable for the ambulance billing company is to keep their costs down by limiting the interaction with each claim. This means that no one at the ambulance billing company is looking at what was actually written in the patient chart. Instead, they are relying on an electronic interface to prepopulate a few specific fields in their billing software. This could create compliance risks. What if the checkbox for import shows there is a patient signature, but it is actually a smudge? What if the medic documents something in the narrative that better supports a clinical diagnosis than the chief complaint? Any billing company that won’t take the time to read your patient chart does not deserve your business.
You want a company that can provide you with the expertise and management required to maintain an efficient process that maximizes cash collections and remains compliant with the law. Like going into a car dealership armed with information, we believe you should approach the hiring (or firing) of an EMS billing company with the same care. You can’t afford to drive a lemon.