Serbin Surgery Center Billing and Short Hills Surgery Center recently presented a free webinar entitled, "Hybrid Center – The Best of Both Worlds (How to Successfully Combine In-Network and Out-of-Network Reimbursement)."
The speakers were Caryl Serbin, RN, BSN, LHRM, president and founder of Serbin Surgery Center Billing, and Nancy Easley-Mack, LPN, business office manager of Short Hills Surgery Center. Serbin Surgery Center Billing was recently sold to SourceMedical, a leading provider of outpatient information management solutions.
Scott Becker, JD, CPA, partner at McGuireWoods, began the webinar by discussing the evolution of in-network versus out-of-network reimbursement. In the "old world" of ASCs, he said ASC leaders were scared to be out-of-network, so they hastily signed poor contracts and sometimes ended up doing hundreds of cases a month and still losing money. In response to that, centers started to go out-of-network, and as they recognized the set of rules necessary to treat patients and bill payors OON, they became much more comfortable with being OON. "Many centers were making a great percentage of profits and revenues from being out-of-network, even if it wasn't a huge percentage of patients," he said.
In response to this movement towards OON centers, payors fought back with various tactics. Over the last several years, Mr. Becker said many centers have struck a balance of going OON when payors offer poor contracts to in-network centers and staying in-network in the hope of getting more cases and eliminating fights with payors.
In-network and out-of-network at Short Hills Surgery Center
At Short Hills Surgery Center in Millburn, N.J., billing is now outsourced to two billing companies — in-network and out-of-network. The center started as an out-of-network center and retained the same OON billing company, while Serbin Surgery Center Billing now provides in-network billing for Short Hills Surgery Center. Because Short Hills is a billing client of Serbin Surgery Center Billing, Ms. Easley-Mack presented her center's experience on transitioning to in-network billing with Serbin's help.
Prior to going in-network, the center's average case volume was around 500 cases a month and now provides around 750 cases a month. Ms. Easley-Mack pointed out that centers considering moving in-network need to consider whether they have the space to accommodate more cases, as case volume will grow significantly. Ms. Serbin says if you can't add additional cases to your center, you will suffer financially when you move from OON to in-network billing.
Serbin Surgery Center Billing assisted in the billing process by developing the fee schedule, selecting a different clearinghouse for each billing company and selecting the collection agency. They also established a process for in-network documentation to maximize coding by setting up a system that ensured all documentation — including additional items such as implants and medications — was included.
Ms. Serbin pointed out that Medicare will allow a period of up to 90 days where an ASC can have two billing companies. "Once we took over all in-network billing, we became the billing company for all in-network and all government payors," she said. "There is absolutely no confusion between the two billing companies as to who their patients are and who they are to bill for."
Contracting phase
The first phase of the in-network transition was to negotiate contracts. The center polled its physicians and asked them what type and how many in-network cases were done at other facilities to determine an expected in-network case volume. Because the center had 25,000 feet of clinical space, they had room to add cases.
By taking into consideration past performance and factoring in proposed case volumes, they negotiated carve-outs for procedures, implant supplies and medication and negotiated the best possible rate.
Legal review
According to Ms. Easley-Mack, the language of a contract plays a large role in determining how a center will be reimbursed. She recommends ASCs redline the contract several times until they have a clear idea of the language and claims submission and payment guidelines. "This can take quite a bit of time," she said. "In regard to physician buy-in, we worked out the numbers and language, gained board approval and presented the business model to medical staff."
Short Hills presented its case mix and volume targets to its physician partners, feeling it was crucial for the partners to understand what was required to ensure success of the hybrid model.
The surgery center also hosted meetings with physician practices to discuss changes to schedule protocol, new referral and authorization requirements, up-front collection of pays, deductibles and co-insurance and expected increase in volume. They recommended that physicians schedule cases as far in advance as possible because of the increase in volume.
Billing company selection
Ms. Easley-Mack said the Short Hills team chose Serbin Surgery Center Billing for its expertise in in-network billing, from compliance to process. She said the expertise of Serbin ensured that the center and the Serbin team were well-prepared for the new in-network process on the first day of contracts.
Transitioning ASC processes
Short Hills restructured its business office by creating two books of business, in-network and out-of-network, Ms. Easley Mack said. She noted that insurance verification did not become easier because the center was a participating provider. It was still a challenge to obtain accurate information on general benefits, out-of-pocket maximums and contribution to benefits, she says. "Additionally, with our up-front collections policy, we have to calculate an accurate dollar amount for each in-network patient's out-of-pocket expense," she says. "We created payor-specific calculators to determine a fair estimate of a patients' financial responsibility for each [visit]."
Ms. Serbin added that her company assisted with the process of setting up the software for in-network billing in the ASC. Previously, the ASC had not used in-house software for billing because the OON billing company used its own software. "One of the positives is that they're now able to use the software for their inventory and preference cards and tie it to the billing piece as well," she added. "Now they are fully utilizing the software."
Serbin also assisted in setting up the ASC's front office for in-network versus out-of-network. The billing company helped with tasks such as loading insurance contracts and setting up methods to ensure that contracts were paid according to contract levels.
The ASC called patients two weeks prior to the date of service to give them an understanding of the center's payment expectations. They also instituted a policy to encourage collections during registration process and make sure all payments were systematically received, processed and submitted to accounting in an efficient manner.
In terms of choosing cases, the center considered specialty and payor mix, as well as case cost versus reimbursement. The patient's clinical history played a role as well. The presenters agreed this process will vary from center to center, as there are always exceptions to gate-keeping protocols.
Challenges and successes
Short Hills has experienced some challenges and many successes in the transition to in-network. Ms. Easley-Mack said her most significant challenges include claims adjudication and clean claims requirements, reimbursement of services and supplies in addition to case rate and inconsistent information from provider services on pre-cert requirements.
At the same time, she said the center has improved its market position, achieved predictable reimbursement, improved OR utilization, increased case volume, maximized its in-network revenue and reduced days in A/R.
The speakers were Caryl Serbin, RN, BSN, LHRM, president and founder of Serbin Surgery Center Billing, and Nancy Easley-Mack, LPN, business office manager of Short Hills Surgery Center. Serbin Surgery Center Billing was recently sold to SourceMedical, a leading provider of outpatient information management solutions.
Scott Becker, JD, CPA, partner at McGuireWoods, began the webinar by discussing the evolution of in-network versus out-of-network reimbursement. In the "old world" of ASCs, he said ASC leaders were scared to be out-of-network, so they hastily signed poor contracts and sometimes ended up doing hundreds of cases a month and still losing money. In response to that, centers started to go out-of-network, and as they recognized the set of rules necessary to treat patients and bill payors OON, they became much more comfortable with being OON. "Many centers were making a great percentage of profits and revenues from being out-of-network, even if it wasn't a huge percentage of patients," he said.
In response to this movement towards OON centers, payors fought back with various tactics. Over the last several years, Mr. Becker said many centers have struck a balance of going OON when payors offer poor contracts to in-network centers and staying in-network in the hope of getting more cases and eliminating fights with payors.
In-network and out-of-network at Short Hills Surgery Center
At Short Hills Surgery Center in Millburn, N.J., billing is now outsourced to two billing companies — in-network and out-of-network. The center started as an out-of-network center and retained the same OON billing company, while Serbin Surgery Center Billing now provides in-network billing for Short Hills Surgery Center. Because Short Hills is a billing client of Serbin Surgery Center Billing, Ms. Easley-Mack presented her center's experience on transitioning to in-network billing with Serbin's help.
Prior to going in-network, the center's average case volume was around 500 cases a month and now provides around 750 cases a month. Ms. Easley-Mack pointed out that centers considering moving in-network need to consider whether they have the space to accommodate more cases, as case volume will grow significantly. Ms. Serbin says if you can't add additional cases to your center, you will suffer financially when you move from OON to in-network billing.
Serbin Surgery Center Billing assisted in the billing process by developing the fee schedule, selecting a different clearinghouse for each billing company and selecting the collection agency. They also established a process for in-network documentation to maximize coding by setting up a system that ensured all documentation — including additional items such as implants and medications — was included.
Ms. Serbin pointed out that Medicare will allow a period of up to 90 days where an ASC can have two billing companies. "Once we took over all in-network billing, we became the billing company for all in-network and all government payors," she said. "There is absolutely no confusion between the two billing companies as to who their patients are and who they are to bill for."
Contracting phase
The first phase of the in-network transition was to negotiate contracts. The center polled its physicians and asked them what type and how many in-network cases were done at other facilities to determine an expected in-network case volume. Because the center had 25,000 feet of clinical space, they had room to add cases.
By taking into consideration past performance and factoring in proposed case volumes, they negotiated carve-outs for procedures, implant supplies and medication and negotiated the best possible rate.
Legal review
According to Ms. Easley-Mack, the language of a contract plays a large role in determining how a center will be reimbursed. She recommends ASCs redline the contract several times until they have a clear idea of the language and claims submission and payment guidelines. "This can take quite a bit of time," she said. "In regard to physician buy-in, we worked out the numbers and language, gained board approval and presented the business model to medical staff."
Short Hills presented its case mix and volume targets to its physician partners, feeling it was crucial for the partners to understand what was required to ensure success of the hybrid model.
The surgery center also hosted meetings with physician practices to discuss changes to schedule protocol, new referral and authorization requirements, up-front collection of pays, deductibles and co-insurance and expected increase in volume. They recommended that physicians schedule cases as far in advance as possible because of the increase in volume.
Billing company selection
Ms. Easley-Mack said the Short Hills team chose Serbin Surgery Center Billing for its expertise in in-network billing, from compliance to process. She said the expertise of Serbin ensured that the center and the Serbin team were well-prepared for the new in-network process on the first day of contracts.
Transitioning ASC processes
Short Hills restructured its business office by creating two books of business, in-network and out-of-network, Ms. Easley Mack said. She noted that insurance verification did not become easier because the center was a participating provider. It was still a challenge to obtain accurate information on general benefits, out-of-pocket maximums and contribution to benefits, she says. "Additionally, with our up-front collections policy, we have to calculate an accurate dollar amount for each in-network patient's out-of-pocket expense," she says. "We created payor-specific calculators to determine a fair estimate of a patients' financial responsibility for each [visit]."
Ms. Serbin added that her company assisted with the process of setting up the software for in-network billing in the ASC. Previously, the ASC had not used in-house software for billing because the OON billing company used its own software. "One of the positives is that they're now able to use the software for their inventory and preference cards and tie it to the billing piece as well," she added. "Now they are fully utilizing the software."
Serbin also assisted in setting up the ASC's front office for in-network versus out-of-network. The billing company helped with tasks such as loading insurance contracts and setting up methods to ensure that contracts were paid according to contract levels.
The ASC called patients two weeks prior to the date of service to give them an understanding of the center's payment expectations. They also instituted a policy to encourage collections during registration process and make sure all payments were systematically received, processed and submitted to accounting in an efficient manner.
In terms of choosing cases, the center considered specialty and payor mix, as well as case cost versus reimbursement. The patient's clinical history played a role as well. The presenters agreed this process will vary from center to center, as there are always exceptions to gate-keeping protocols.
Challenges and successes
Short Hills has experienced some challenges and many successes in the transition to in-network. Ms. Easley-Mack said her most significant challenges include claims adjudication and clean claims requirements, reimbursement of services and supplies in addition to case rate and inconsistent information from provider services on pre-cert requirements.
At the same time, she said the center has improved its market position, achieved predictable reimbursement, improved OR utilization, increased case volume, maximized its in-network revenue and reduced days in A/R.
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