Friday, February 13, 2009

Are You Paying Attention to Your Fee Schedules?

Have you reviewed your fee schedules lately to determine if you’re getting proper reimbursement for all your services? Now is a great time to take a look at what you are doing and make appropriate changes for 2009.

We have found on a regular basis that physicians are miscalculating their non-Medicare fees, which means revenue they are due is slipping through their fingertips. Here are some steps to take to help you determine if the private payers are reimbursing you at a fair rate.

1. Measure and Document What You Can Control
< Determine your total overhead expenses. Separate physician work (including physician salaries and benefits as well as any bonuses) and practice expense (including staff salaries/benefits, space expenses, office supplies and medical supplies).
< Calculate your cost per RVU. Calculate cost for visit services; calculate cost for treatments and procedures; calculate total cost per treatment.
< Compare your practice revenue with your costs (be sure to include Medicare and non-Medicare).
Preforming this exercise once per year will help you set practice benchmarks and sound measures for decision-making.

2. Review What’s Going On Outside Your Practice
Now, you’re ready to review your current private pay fee schedules to determine whether they measure up to your current costs.
Here are some tips:
< What should you expect as payment from non-Medicare payers? We believe at least 30% above Medicare.
< Should you utilize the “loaded” Medicare fee schedule as your basis for negotiating a contract with non-Medicare payers? We think not. Rather, use the unadjusted RVU data, because the geographic adjustment factor could potentially lower your payment.
< Should you accept the non-Medicare payer contracts as is? No! Rather, “calculate and negotiate”. If you document what your reimbursement should truly be, you have more leverage to negotiate with payers. You should include the following: data for expenses – need to be sure yours are covered; data that illustrates you need to be reimbursed at least “X” amount of money and why; tell them at what rate other payer contracts are reimbursing – then compare.

For an example of how to calculate Fee Schedules, visit

No comments: