During a Sept. 16 webinar hosted by Becker's ASC Review, John Bartos, JD, CEO of Collect Rx, a company that helps ambulatory surgery centers and other healthcare providers improve out-of-network reimbursements, outlined the key steps ambulatory surgery center leaders can take to build an Out-of-Network (“OON”) strategy in a healthcare environment being reshaped by reform and increasing downward pressure from payers.
Payer tactics
"During the past 10 years insurance companies and vendors have used various tactics to reduce OON reimbursements," said Mr. Bartos. "The good news is that these tactics are not as widespread or effective as you may think." When building an OON strategy, it is important to understand how payers will work to reduce payment. Key payer strategies include:
• Bill reduction tactics
• Limited benefits policies
• Third-party rental agreements
Creating a strategy
Despite payer opposition, ASCs can effectively leverage and increase OON reimbursement. "A hybrid of in-network and OON puts the ASC in the best position to increase reimbursements," said Mr. Bartos. The decision of which payers to remain in-network with and which to go OON with is based on each ASC's location. Key points to consider include:
• Local payer mix
• Local employer mix
• Comparable reimbursement levels for the most common procedures
• Relative market share
Compare in-network reimbursement to expected OON reimbursement for common procedures. To complete this analysis, ASC leaders need to know the number of in-network cases and average in-network reimbursement per case, as well as projected OON volume and projected OON reimbursement levels. "For providers that have been traditionally in-network, try the 'dip your toe in the water' approach," he said. "Pick a payer with low volume and try going OON. After four to six months, make the decision whether or not to cancel with other payers."
In-house or outsourcing?
Effectively increasing OON reimbursement is a labor-intensive process. Before undertaking it, ASC leaders need to know if they have the proper resources and expertise on hand. From start to finish, appealing an OON bill includes:
• Initial intake. Have all necessary documentation on hand.
• Payer verification. Contact the payer for a verbal explanation of reimbursement.
• Payer engagement. Present the relevant facts and data. Escalate the issue when necessary.
• Settlement. Payers do not always pay on time or with the correct amount. Follow-up to ensure the ASC is paid.
• Auditing OON activity. Consistent monitoring of OON activity will allow ASC leaders to gauge how effective the strategy is.
If an ASC does not have the resources of expertise to handle each step of maximizing OON reimbursement, outsourcing may be the best option.
Patient Protection and Affordable Care Act (PPACA) impact
Each year there are $60 billion in OON claims, the majority of which are driven by PPO patients, said Mr. Bartos. The PPACA, while a source of contention throughout healthcare, could actually be a driving force for OON volume. More patients are becoming insured and reform is pushing forward narrow networks of providers. A larger patient pool with restricted choice suggests that OON volume will trend upwards.
Third-party rental networks and continuous discount agreements
Third-party rental networks are not signed with an individual payer, but with a company that contracts with multiple payers. Providers are contracted with all payers involved in the third-party network, but this can be detrimental from the provider perspective. "Third-party rental networks are a cost containment strategy for payers," said Mr. Bartos. "The customer is not the patient or provider; it is the payer."
Continuous discount agreements are similar to third-party networks. "When signing a single case rate agreement, there is a box where the provider can indicate they're willing to accept that level of payment going forward," said Mr. Bartos. "The rates are often low and many providers don't even know they've entered into these agreements."
Download the webinar presentation here.
View the webinar by clicking here. We suggest you download the video to your computer before viewing to ensure better quality. If you have problems viewing the video, which is in Windows Media Video format, you can use a program like VLC media player, free for download here.
Note: View archived webinars by clicking here.
Payer tactics
"During the past 10 years insurance companies and vendors have used various tactics to reduce OON reimbursements," said Mr. Bartos. "The good news is that these tactics are not as widespread or effective as you may think." When building an OON strategy, it is important to understand how payers will work to reduce payment. Key payer strategies include:
• Bill reduction tactics
• Limited benefits policies
• Third-party rental agreements
Creating a strategy
Despite payer opposition, ASCs can effectively leverage and increase OON reimbursement. "A hybrid of in-network and OON puts the ASC in the best position to increase reimbursements," said Mr. Bartos. The decision of which payers to remain in-network with and which to go OON with is based on each ASC's location. Key points to consider include:
• Local payer mix
• Local employer mix
• Comparable reimbursement levels for the most common procedures
• Relative market share
Compare in-network reimbursement to expected OON reimbursement for common procedures. To complete this analysis, ASC leaders need to know the number of in-network cases and average in-network reimbursement per case, as well as projected OON volume and projected OON reimbursement levels. "For providers that have been traditionally in-network, try the 'dip your toe in the water' approach," he said. "Pick a payer with low volume and try going OON. After four to six months, make the decision whether or not to cancel with other payers."
In-house or outsourcing?
Effectively increasing OON reimbursement is a labor-intensive process. Before undertaking it, ASC leaders need to know if they have the proper resources and expertise on hand. From start to finish, appealing an OON bill includes:
• Initial intake. Have all necessary documentation on hand.
• Payer verification. Contact the payer for a verbal explanation of reimbursement.
• Payer engagement. Present the relevant facts and data. Escalate the issue when necessary.
• Settlement. Payers do not always pay on time or with the correct amount. Follow-up to ensure the ASC is paid.
• Auditing OON activity. Consistent monitoring of OON activity will allow ASC leaders to gauge how effective the strategy is.
If an ASC does not have the resources of expertise to handle each step of maximizing OON reimbursement, outsourcing may be the best option.
Patient Protection and Affordable Care Act (PPACA) impact
Each year there are $60 billion in OON claims, the majority of which are driven by PPO patients, said Mr. Bartos. The PPACA, while a source of contention throughout healthcare, could actually be a driving force for OON volume. More patients are becoming insured and reform is pushing forward narrow networks of providers. A larger patient pool with restricted choice suggests that OON volume will trend upwards.
Third-party rental networks and continuous discount agreements
Third-party rental networks are not signed with an individual payer, but with a company that contracts with multiple payers. Providers are contracted with all payers involved in the third-party network, but this can be detrimental from the provider perspective. "Third-party rental networks are a cost containment strategy for payers," said Mr. Bartos. "The customer is not the patient or provider; it is the payer."
Continuous discount agreements are similar to third-party networks. "When signing a single case rate agreement, there is a box where the provider can indicate they're willing to accept that level of payment going forward," said Mr. Bartos. "The rates are often low and many providers don't even know they've entered into these agreements."
Download the webinar presentation here.
View the webinar by clicking here. We suggest you download the video to your computer before viewing to ensure better quality. If you have problems viewing the video, which is in Windows Media Video format, you can use a program like VLC media player, free for download here.
Note: View archived webinars by clicking here.