Reimbursement Analysis – A Critical Component to the Implementation of New Services

In our current competitive healthcare environment, innovative services are an important dynamic to a successful revenue cycle.  Patients want the most current care delivery methods, new technology, pharmaceuticals, and actively seek providers who can supply them.

Thorough reimbursement analysis which provides an accurate picture of the reimbursement environment as it pertains to your new service is important to ensure your organization will be able to provide new, innovative services like newly released drugs, devices, and implants to patients while still achieving a margin which will allow continued growth.

A comprehensive reimbursement analysis should be conducted with adequate lead time to include an in-depth understanding of payer-mix, the delivery cost of the new service, and the anticipated reimbursement by the designated payer.  Also included should be detailed coding and billing requirements to ensure your organization is prepared before service delivery to process claims.

Those of us who are healthcare professionals have probably been in situations where new services are initiated without the inclusion of the appropriate revenue cycle team members, resulting in denials, delays, loss of revenue, unhappy patients and discontent providers. Multiple departments should be included to ensure a comprehensive approach is conducted.  The service area, coders, reimbursement, billing, and a CDM resource should all be included.  If the new service is a new drug, an appropriate pharmacy resource should be included, as well.

To avoid the need to recover lost revenue and implement service backfill, it’s crucial to have a structured program in place. This program should include a check list and appropriate sign-off from all pertinent staff or departments involved.

Here are the critical components to a successful reimbursement analysis. To spearhead this initiative, many organizations have a reimbursement analyst on staff and others may utilize a CDM resource for managing this activity.

1. Develop an in-depth understanding of the technology or device cost-to-reimbursement ratio
   1. Without an in-depth understanding of this ratio, you may be setting up a new service that will not be reimbursed or will be reimbursed at a rate that will not cover costs. Knowing before the service is provided will avoid this risk.
   2. In our ever-challenging reimbursement environment it is not a viable option for hospitals to provide new technology or services at a loss.
      
      
2. Use caution when considering off-label use of pharmaceuticals as reimbursement is unlikely
   1. Off-label is the use of pharmaceutical drugs for an unapproved indication or in an unapproved age group, dosage, or route of administration. Reimbursement is not likely when prescription drugs are used in these ways because payers will only reimburse for established criteria supported by the FDA.
   2. You may be pressured by clinicians who may not understand this policy and think there is a benefit for the patient in off-label use. If you continue to use off-label in this manner, you will have to consider requiring the patient to pay for these services out-of-pocket or provide the services at a loss to the organization.
   3. I have worked with multiple hospital systems who have decided to move forward with off-label use of pharmaceuticals based on clinical criteria. Most organizations hold the patient responsible after informed financial consent and assurance that the appropriate specific waiver or ABN is in place.
      
      
3. Research payer reimbursement requirements
   1. Requirements will vary by payer and a good relationship with payer representatives will help to streamline this process. It is not unusual that some payers will reimburse for new service offerings while others will not.
   2. The product vendor will, in most instances, provide generic coding and billing guidelines.
   3. Devices present special challenges with additional coding and billing requirements and may require test claims be processed to ensure you have the right process developed for reimbursement.
   4. Questions you should ask during this part of the reimbursement analysis include:
      1. Is the new service covered and, if so, under what conditions?
      2. Are there clinical criteria that must be met and thoroughly documented in the EHR?
      3. Are there specific coding guidelines needed?

1. Figure out if the use of the new technology requires patients to participate in a registry
   1. A clinical trials registry is an official platform and catalog for registering a clinical trial. It’s important to know if a registry number is required because if it’s missing on a claim, it will not be processed until corrected.
   2. Most hospitals have a resource who is responsible for the clinical registry process, it would be to your benefit to figure out who they are for your organization.
   3. In most instances, the product vendor can provide the insight as to whether the new service requires this component.
      
      
2. Identify any special billing requirements that would be needed along with any subsequent system changes that will be required to accommodate the implementation
   1. For new technological devices, you’ll need to know if the exact cost of the device is required on the claim, an invoice from the vendor may be required when submitting claims as documentation.
   2. Some pharmaceuticals provided to inpatients may require a separate outpatient claim for reimbursement. An example of this is LARC (Long Acting Reversible Contraception).
   3. Once coding and billing guidelines are established, ensure you have the appropriate edits in place to catch these claims before they are submitted so that all required components make it to the claim.
   4. Educate you billing team on any changes
   5. There may be items on your claim that need to be entered manually. Make sure to update your policies and procedures so staff are reminded of this process.
   6. Depending on the scope of manual intervention needed, a training session may be in order.

   By using this checklist as a jumping off point, implementing new and exciting technologies can result in a more successful organization. You can be confident that your reimbursement analysis is comprehensive, includes all revenue cycle components, and includes the necessary communication between departments. 

   Source: http://meetings.hayesmanagement.com/blog/reimbursement-analysis-a-critical-component-to-the-implementation-of-new-services?utm_source=hs_email&utm_medium=email&utm_content=55333730&_hsenc=p2ANqtz-9YsUkXJji9uXp4RJjmhQiSJseFSJjt2P9qKsqwWNWILL1NeUuW-FCJBmGuW0MMxuU87pGU2fzzCn2MWgpoIRXFefIWWA&_hsmi=55333730