Billing: Keep Your Eye on the Ball!

Last month, I recounted a story of the discovery of a file cabinet with over $800,000 worth of unsubmitted claims. What follows is an account of what we did to make sure something like this never happens again.

Many of us have learned the hard way that billing nightmares can sneak up on you, but it is difficult to proactively know when trouble is looming. Here is what we did to solve our problems:

Take Ownership: As CEO, I took my insurance billing department for granted. I assumed my role was that of growing the business and "playing" owner. I had tight controls over the Sales, Operations, Fabrication, and other departments but had never taken the time to learn the intricacies of the daily functions of the Insurance Department. The first step to ensure billing problems did not recur was taking ownership of this department.

Establish Policies and Procedures: The reason why claims were being left pending initially was because we did not have policies and procedures in place for our employees to follow. Simply put, they did not know how to carry out their day-to-day duties. Our employees inherently wanted to do a good job, but they needed a set of rules to work by. Armed with knowledge, they could do their jobs correctly.

Unfortunately, we left it to the employees' discretion when deciding how to handle many situations, and since management had not dictated policy, employees did the best they could. Upon this realization, we decided to enact policies and procedures stating exactly how to carry out every aspect of the insurance billing process. Our intention was that once this policy and procedure manual was written, persons with very little experience could be trained on how to do their jobs.

Observe and Work with Your Personnel: Within weeks of supposedly solving our problems, we began noticing pending claims were once again piling up. We were devastated. How could this happen after we had enacted policies and procedures to make sure this problem never recurred?

When we looked further, we discovered that our personnel did not feel comfortable with the newly instituted policies and procedures.

We soon discovered the idiocies of our protocols. The mistake we made was developing policies and procedures without knowing what was going on in the department. It was very easy for us to sit behind a manager's desk and establish our protocols. But when it came to following the guidelines set forth in these policies on a day-to-day basis, we struck out.

We did not observe the employees as they carried out their day-to-day tasks to ensure that our policies made sense. We learned the hard way that if a company's policies and procedures do not make sense, employees will become confused and disheartened. Once again, they will find another filing cabinet to start hiding questionable claims.

After we observed our employees at work, our two-page impractical protocol soon grew to 15 pages, and it is now over 20. It is simply not effective for management to sit behind a desk and dictate to employees how to do their job. We must work with the employees to verify that policies and procedures make sense, both on the drawing board and in the field.

Quantify Results: We realized that management would never be able to plan for all unforeseen events. Therefore, it became important for us to quantify the productivity of our staff to ensure that claims were not being held. Initially, we decided to tabulate the total number of claims mailed on a daily basis.

The results were disastrous. It was impossible for us to ascertain why one day we would mail out 100 claims and the next day mail out 30. When we went back to the individuals, they pointed fingers at each other, hiding in the confusion and safety of their numbers.

We sat at the drawing board again and decided to quantify daily results by each employee. For example, we wanted to know what an intake specialist was doing on a daily basis. Her job was to: 1) Enter data, 2) Pre-certify and verify benefits, 3) Enter charges, and 4) Forward to billing. We began tabulating the numbers of each of these tasks performed each day.

Employee Feedback: I was soon overwhelmed with a two-page legal-sized table with more information than I knew what to do with. We were able to simplify the data by breaking it down and producing graphs for each employee. Now we look at them on a weekly basis for each employee and for the department.

This allows us to see exactly what each employee is accomplishing on a weekly basis. Now, if a particular employee has low productivity numbers one week, we can communicate with this employee in order to determine what happened. An employee loses the ability to say, "I did not get claims out this week, because I was doing data entry or pre-certing," because these tasks are logged also. Now there is no room for argument.

Every week employees' numbers speak for themselves, and there is no room for excuses. If a particular biller averages 200 claims a week, and one week bills 110, then we will ask the employee what happened.

Graph Crazy: Now our employees accuse management of going "graph crazy." Anytime there is a recurring problem, the mere threat of graphing compliance immediately solves it. We have graphed things such as percentage of clean claims, percentage of returned claims, percentage of accuracy of data entry, and number of braces fabricated on a daily basis.

The graphs have been invaluable in solving many compliance issues that we have had with our employees. For example, the error ratio found by our auditor from the intake department has decreased from about 27 percent to less than 5 percent. Also, we have been able to show employees that some weeks they are literally two and sometimes three times more productive than other weeks. We are able to let employees know that if they can consistently reach this level of productivity, they will be rewarded financially upon their next evaluation.

What are the results of the changes we made? We have increased our collection percentage by 17 percent in just one year, and now we have learned to proactively try to find holes in our billing system, so that we can solve these problems and become even more profitable. Accomplishing all of this allows management to focus on why we got into this business to begin withto serve the patient's needs.

Joe Sansone is CEO of TMC Orthopedic,

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