14 FAQs on out-of-network billing strategies

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As payers step up their efforts to constrain out-of-network reimbursement rates, learning to navigate roadblocks to achieve higher repayments can significantly improve a provider's financial results and bottom line.

Since its inception in 2006, Collect Rx has helped providers obtain higher reimbursements on out-of-network bills by employing its expertise in negotiation. The organization has grown to serve 1,300 customers across the nation and now processes more than $1 billion in out-of-network claims annually.

In a Nov. 15 webinar sponsored by Collect Rx and hosted by Becker's Hospital Review, Richa Singh, executive vice president of sales at Collect Rx, answered commonly asked questions on out-of-network reimbursement negotiation, payment processing and policies, to help healthcare leaders drive revenue capture and reduce possible bad debt.

Here were 14 questions addressed in the webinar.

1. What is the No. 1 key to successful out-of-network negotiations?

Successful negotiations happen when providers are persistent. This persistence includes responding to each counteroffer and following up with appealed underpayments, no matter how long they take.

"Vendors put up obstacles for success. Their goal and sole aim is to get you to throw in the towel. They know you are busy and you don't have the time to negotiate," Ms. Singh said.

2. What is the best method to negotiate with payers?

Picking up the phone and calling payers, even though it is the most time-consuming, it is the best method to use. 

3. Is it worth the trouble to negotiate even if your health system doesn't see many out-of-network bills?

Providers, regardless of out-of-network volume, should always negotiate. Ensuring an organization captures all owed-payment is key to a healthy revenue cycle and strong bottom line.

"Even providers with a low volume [of out-of-network patients] that employ a strong negotiation process are able to generate significant additional dollars that will cover costs," Ms. Singh said.

4. Why would I want to be out-of-network?

 When negotiated effectively, out-of-network reimbursements can be higher than in-network reimbursements, which can increase profitability. This is because healthcare providers have the flexibility and opportunity to set higher reimbursement rates that can make up for low rates set by government payers.

"In network contracts are what they are. With Medicare and Medicaid reimbursement rates, there is no opportunity to change those rates, but you can definitely leverage higher out-of-network reimbursements. It's one of the last great ways for providers to bring more dollars through the door," Ms. Singh said.

5. How do you collect more than what's Usual, Customary and Reasonable?

UCRs are fee guidelines that rein in the amount providers can charge for out-of-network patients and serve as a guideline insurers use to determine the amount they will pay for out-of network care. 

Since UCR is a vague term, providers can use data, insurance policies and expertise to negotiate a rate they believe is usual and customary.

6. What is a limited benefit policy?

 A limited benefit policy typically limits payer reimbursements to a percentage of Medicare or of total billed charges, restricting the amount a hospital can recover from the payer. 

7. What are examples of a limited benefit policy?

Examples of such policies include UnitedHealthcare MNRP and Cigna MRC.

8. Won't negotiating aggressively ruin my relationship with these vendors?

Many providers believe they have good relationships with their vendors. However, Ms. Singh warns that this is what vendors want providers to believe. 

"These vendors are not your friends; they are compensated based on the money they save their clients, the insurance company. You are one grain of sand in a mile-long beach from the payer's perspective," Ms. Singh added.

9. Is it appropriate vendors give me less than a day to negotiate?

Vendors often send proposals with short turnaround times. "Their goal is to put pressure on the provider to settle quickly. Sometimes the turnaround times are real, but sometimes they are not," Ms. Singh said.

10. Is it good to sign up with third-party portals to accept single-case agreements?

 A single-case agreement is an agreement where the provider and an out-of-network insurance company act as if they are contracted for one specific patient.

Some vendors use third-party portals to send proposed single-case agreements instead of faxing or emailing them. Many providers utilize these portals because vendors promise they accelerate the process; however, these portals do not always allow negotiations, you can only accept or decline their offer, Ms. Singh explained.

11. What is the best way to successfully appeal underpaid bills?

 "To start, you need resources devoted to appealing cases. These resources need data to make arguments to the payer. You need a plan or method to your appeal process, meaning you need to know when to write letters or when and how to escalate the case. And you need to be persistent, because the payers and vendors put up obstacles to success," Ms. Singh said.

12. What is an assignment of benefits?

 It is a document signed by a patient in which one of the terms is requesting the insurer send money directly to the provider.

13. What is a silent PPO (or third-party rental agreement)?

A third-party rental agreement, also known as a silent PPO, is an agreement signed with a third party that contracts with multiple payers.

"These [third parties] are middlemen of sorts," Ms. Singh explained. "[Silent PPOs] bring together payers and providers to participate in contracts that are often not favorable from a provider perspective for a number of reasons. They are also often offered to other payers in networks the provider doesn't even know about."

14. Why do I receive settlement offers when I have a contract?

Payers are always attempting to beat the contracted rate by negotiating lower.

To receive answers to more than 40 FAQ on out-of-network strategy, listen to the webinar here and view the webinar slides here.

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