Do you have a fee schedule and if so, do you maintain it on a regular basis? This is an easy step to skip, but an annual review could put some extra cash in your pocket and help you keep a better handle on how much collectible money you have outstanding. Here are some things you should consider when creating or maintaining your fee schedule.
Mark up the charge amount: Did you know that most payers will not pay you more than what you charge, even if you charge less than the allowed amount? They will accept whatever charge amount you have and adjust the difference, but they won't pay you more than you charge. This can really cost your practice!
Allowed amounts change: In addition to payers updating the allowed amount for services, many insurances are offering incentive based programs you may be eligible to collect a percentage over the allowed amount! If you are basing your charge amount on the payers allowed amount you may never see the incentive money that you have earned! Even a small percentage can add up quickly!
Create consistency: If you aren’t sure where to start, consider setting your charge amounts based on the Medicare allowed amounts. Using 150% of the Medicare allowed amounts is a fairly standard starting point. Using a consistent rate to set your fees will make it easier to gauge how much of your outstanding Accounts Receivable is collectible.
In addition to keeping the fee schedule current, make sure to monitor Allowed Amount and Paid Amount on a monthly basis. If you find that you are collecting the full allowed amount it’s time to increase the charge amount so you don’t leave money on the table!
If you need help getting started – consider working with a consultant. At RCM Insight we offer annual fee schedule reviews. During the month of February we will be offering 4 practices a FREE fee schedule review – visit the Contact page and choose Fee Schedule as your Area of Interest for your chance to win!