Feeling weighed down by details and paperwork? Here are some ideas for lightening the load of multiple managed care plans.
Fam Pract Manag. 1998 Mar;5(3):66-78.
If there were a motto for family physicians heavily involved in managed care, it might be, “Just let us be doctors!” Unfortunately, you have much more than patient care to worry about these days, and working with a variety of plans just makes the administrative side of managed care all the more worrisome.
Juggling managed care's administrative hassles means staying on top of credentialing paperwork, reimbursement arrangements, co-payment collection and ever-changing patient eligibility lists. For many practices, it also means trying to educate patients about their plans. Although these are serious headaches, family physicians and practice management consultants have a number of tips to help ease the pain.
But to get the most effective pain relief, you may need stronger medicine. As with the care-related hassles we discussed last month (see “Making Patient Care Easier Under Multiple Managed Care Plans,” February 1998), questions about how to cope with administrative hassles tend to point to a conclusion that may not be music to the ears of all family physicians. The path to a successful future seems fairly clear: Definitely computerize and probably integrate, or be prepared to get out of the way.
Help with credentialing
For many family physicians, signing up with multiple plans brings on seemingly endless credentialing forms, recredentialing forms and site visits. And, of course, the plans want the information provided in very specific ways. This can leave practices with the task of submitting the same information slightly differently for 10 or 20 plans. Eating up more time are the plans' on-site reviewers, whose office inspections and chart audits may take a full day or more and who need your staff's aid to complete their reviews.
Credentialing headaches are among those being discussed by the Academy's Commission on Health Care Services (CHCS), which is developing a set of principles to guide family physicians in negotiations with plans about managed care hassles. In these principles, which the Academy hopes to issue in collaboration with important players in the insurance industry, the commission plans to include standards that would make credentialing applications and quality assurance site visits less time-consuming and intrusive, says commission member Charles H. Rodgers, MD, a family physician at Columbia Family Clinic in Little Rock, Ark.
Depending on where you live, your state medical society also may be able to help. Societies in many states are working with insurers to develop standard credentialing forms that at least most of their states' insurers will accept, says Darrell Schryver, DBA, a consultant with the Medical Group Management Association (MGMA). With a standard form, physicians can fill it out once (either on paper or online) and submit it to different managed care organizations (MCOs).
These forms are already in use in some states. The California Participating Physician Application, first released in 1996, is now in its second edition. The application, which includes forms for initial credentialing and recredentialing, was developed by the California Medical Association (CMA), the American Medical Group Association, the California Association of Health Plans and other groups. About 85 percent of California's major MCOs accept the forms, says Jill Douglas, director of project development for the CMA.
The Pennsylvania Medical Society also has led insurers in its state to develop a standard application. Released in early 1997, the form now is accepted by 24 of the state's approximately 30 MCOs, says Amy Dugan, the society's public affairs director. But the Pennsylvania experience illustrates a weakness of efforts to standardize credentialing forms: Two of the state's major plans aren't participating. Still, standard applications are “a step in the right direction,” Dugan says. “If you don't start somewhere, you're never going to get anywhere.”
In May 1997, the American Association of Health Plans (AAHP) released a standard application intended for nationwide use. The AAHP has “strongly encouraged” its member insurers to adopt the application and has made the form available from its web site (http://www.aahp.org). So far, the AAHP has received about 400 requests for the form from health plans and other organizations, but the association doesn't know yet how many plans have actually implemented it, says Susan Probyn, the AAHP's senior manager of accreditation and quality initiatives.
Credentials verification organizations (CVOs) also offer some relief from the paperwork. Private companies and some state societies provide a range of credentialing services, from completing applications for individual physicians to gathering and verifying physician data for hospitals and MCOs. (For a list of CVOs that have been certified by the National Committee for Quality Assurance [NCQA], visit the NCQA web site, http://www.ncqa.org/accred/cvostats.htm, or call 202-955-5697.)
For example, in addition to checking credentials for organizations, the Massachusetts Medical Society's Professional Credentials Verification Service contracts with practices to store physicians' credentialing data and submit it to MCOs. Doctors provide the information using a standard application developed by the society, insurers and hospitals in 1995. All 26 of the state's MCOs accept the form, says Elaine Jaffe Kirshenbaum, MPH, the society's director of strategy and planning.
In Arkansas, a 1995 state law established the Centralized Credentials Verification Service (CCVS), administered by the Arkansas State Medical Board, to maintain credentialing data on Arkansas physicians. After providing their information for the state database, physicians simply update it annually; the hospitals and MCOs that use the service bear its cost. Organizations that contract with the CCVS access physician data via modem, relieving practices of the need to complete unique forms for each plan. Only one Arkansas MCO has contracted to use the service so far, says Mary Jo Stanton, CCVS credentialing coordinator, but the CCVS is urging physicians to lobby other plans to sign up. A similar project is in development in Massachusetts, Kirshenbaum says.
Another state effort seeks to consolidate the onerous site review process. The Ambulatory Records Certification (ARC) project of the Oregon Medical Association (OMA) contracts with 19 MCOs in Oregon and surrounding states to review their physicians' practices. Doctors working with those MCOs can satisfy their site review requirements with a single ARC audit, paid for by the plans. The certification lasts for two years.
Similar programs are now under way in Washington, Arizona and Colorado, and “a number of other states are in some stage of planning to do likewise,” says James A. Kronenberg, OMA associate executive director and ARC project administrator.
National physician certification programs also are under way to alleviate credentialing hassles. For large medical groups and IPAs, the NCQA began offering its Physician Organization Certification program in 1997. When they seek NCQA accreditation, MCOs can substitute the NCQA's physician-organization certification for their own reviews, sparing physicians and their staffs the additional site visits. Organizations can be certified in up to six areas: quality management, utilization management, credentialing, preventive health, members' rights and responsibilities, and medical records. But NCQA certification carries a sizable price tag. Depending on the number of certification areas desired, the cost to the group or IPA ranges from about $18,000 to $38,000, says Brian Schilling, an NCQA spokesperson. Initial certification lasts one year, and recertification lasts three years.
The most comprehensive national effort may be the AMA's American Medical Accreditation Program (AMAP), which was launched in New Jersey in November 1997. It accredits individual physicians, rather than groups, in three areas: credentials, personal qualifications and the practice's environment of care. In the future, it will also accredit doctors in clinical performance and patient satisfaction. According to Randolph D. Smoak Jr., MD, vice chair of the AMA Board of Trustees and chair of the AMAP Governing Body, the cost is shared by the physicians being accredited ($50 to $125 per doctor, depending on AMA membership) and MCOs that contract with AMAP to supply credentialing information about those physicians ($150 to $250 per doctor). For physicians participating with those plans, the credential makes MCOs' reviews in these areas unnecessary.
AMAP is being implemented on a state-by-state basis; the goal is to have it up and running from coast to coast (if not in every state) in the next two years. Of course, the program's success will hinge on its ability to attract MCOs to take part.
Capitation vs. fee for service
Getting paid for what you do seems always to be a hassle, but working with a variety of plans certainly compounds the problem. One major reason is that plans may pay for the same service in different ways — or not at all. What's included in your capitation rate under Plan A may be paid separately by Plan B and not be covered under Plan C.
Cheat sheets like those discussed in last month's article can offer some help in keeping straight what your plans cover and how, especially if you aren't juggling too many plans. For example, staff at one Virginia family practice have developed one-page summaries of each of their 20 plans (see “Check the chart,” February 1998, page 48). The summaries are attached to patients' charts before the patients arrive, so anyone dealing with the chart can easily see highlights of the plan. Each summary also includes any special provisions about coverage of common services. For example, if the summary indicates that well-woman visits aren't covered, then staff ask patients who want that service to sign a waiver, which facilitates billing.
Other cheat-sheet formats, such as paper-based or wall-mounted matrices, can also save time for billing and accounting staff by highlighting plans' payment peculiarities. For example, The Family Clinic of Fort Collins in Colorado uses one column of its insurance matrix to identify which of its 22 plans and sub-plans should be billed for lab work and which shouldn't (see “A matrix for ancillary services,” February 1998, page 47).
But the best way to keep your plans' payment arrangements straight is to let a computer do it for you. The right information system can track all your plans' fee schedules so that you can find out immediately whether you'll be paid for a given service — and, therefore, whether you should provide it or refer the patient elsewhere.
“You build the nuances of your plans into your information system,” says Bette A. Waddington, an MGMA consultant. “Say Mrs. Jones comes in for a physical. Her insurance will pay for the exam itself, as well as flexible sigmoidoscopy and an EKG, but it won't pay for any injections. Your information system has to know that it needs to pull out the procedure code for an injection and bill it to the patient, not the MCO. If the plan is built into your system and that patient is tied to that plan, the system will sort it out for you.”
Information systems can do far more for your reimbursement than just keep your plans' details straight. They can give you the data you need to negotiate better capitation arrangements. But this information is only as complete as the data that you and your staff give the computer. Even when you treat patients in capitated plans, say a number of experts, you should keep encounter data as if you expected to be paid on a fee-for-service basis for everything you do. That way, with the help of your information system, you can compare your capitation payments with what you would have earned in a fee-for-service system. That information can tell you how much of an increase you need to negotiate in your capitation rate to keep your practice financially healthy.
“Our computer system will tell us the ratio of our capitation payments to what our fee-for-service charges would have been,” says William D. Soper, MD, a family physician at The Liberty Clinic in Liberty, Mo., and a member of the FPM Board of Editors. “Initially, managed care contracts paid more than fee for service. Now, as managed care companies have become more successful and doctors have stopped paying attention, capitated contracts are paying about 60 to 70 percent of fee for service. MCOs have really taken advantage of doctors' tendencies just to take care of patients and not pay attention to the business side of practice.”
One challenge in making this kind of comparison work is to get doctors to be complete in their charting. “This is hard for physicians, but it's very important for them to record every single service they provide — whether or not they're going to bill for it — for cost accounting purposes,” says Nancy W. Ashbach, MD, MBA, medical director of Prudential Health Care of Colorado in Denver and a member of the Academy's CHCS.
“Good morning. Five dollars, please.”
One part of getting paid that you and your staff can directly affect is collecting co-payments. But to make it work, you have to know which patients owe them and how much they owe. Again, it's an argument for a good computer system, or at least a cheat sheet summarizing your plans' requirements. Negotiating with plans to include co-payment amounts on patients' membership cards also helps. Especially as your number of managed care contracts increases, you can't expect your front-desk staff to remember how much to collect from patients in each plan and subplan.
To improve the volume and accuracy of your co-payment collections, several experts suggest having your staff ask for the payment at check-in, when they're discussing the patient's insurance information anyway, rather than at checkout, when the patient is focused on getting out of the office. Some practices also post signs notifying patients that an additional processing fee will be added to any co-payment not made at the time of service.
Another strategy is to encourage patients to think about their co-payments even before they leave home. When patients call to schedule appointments at the Hickman Mills Clinic in Kansas City, Mo., staff remind them of the need to bring their co-payments with them, says practice administrator Don Palmer.
Of course, some patients in managed care plans have trouble understanding why they have to pay anything out-of-pocket when they've been told their care is “prepaid.” Others may realize you're not likely to incur the administrative expense of billing for a $5 charge. To help educate these patients, The Family Clinic of Fort Collins has developed a handout explaining co-payments and patients' responsibility for them (see “A co-payment patient handout”). Although “we don't say it in harsh terms,” says Steven J. Thor-son, MD, a family physician there, the handout explains that the practice's level of payment from the insurer assumes that patients are paying a small part of the cost of their care at the time of service.
A co-payment patient handout
Here is a patient handout adapted from one developed by The Family Clinic of Fort Collins in Colorado to explain the philosophy behind co-payments and why collecting them is vital to the practice's financial health.
A few words about co-payments
Now that many of our patients have insurance coverage provided by managed care organizations, we find that patients often are confused about co-payments. Those are the small payments we ask for when you're in the office.
Part of the philosophy of managed care is that it's appropriate for a patient to pay a portion of his or her medical expenses when services are provided. We then bill the insurance company for the balance of our charges. Usually, our agreement with the managed care company requires us to “write off” part of our normal charges as a discount. The insurance company usually pays our clinic directly for the discounted amount they have agreed to pay. In a way, we all contribute. You pay part of the cost, the insurance company pays part and we write off the rest.
We'd appreciate your taking the time to learn a bit more about your co-payment requirements. Most patients have insurance cards that say specifically what the requirements are. Because different insurers have different co-payment schedules, we can't determine your co-payment unless you give us your insurance card or information from your policy that specifies your co-payment. We need to ask you to be responsible for giving us that information.
Further, we consider it your responsibility to pay your co-payment when services are rendered. You can pay by check or in cash.
We do appreciate your help with this process. Managed care has generated enormous confusion for you and for us. Unfortunately, it also substantially increases our costs of doing business while usually paying us significantly less than our normal charges.
We can help each other by trying to simplify the process and by trying to realize each others' responsibilities. We thank you in advance for your active participation in learning more about your insurance program in general, and in understanding your co-payment requirements in particular.
What's my plan?
Collecting the right co-payment, like all the hoops you have to jump through in working with multiple MCOs, requires that you have up-to-date information about your patients and the terms of their coverage. To get it, practices depend on employers to notify insurers of changes in their employees' coverage, as well as insurers to pass that information along to practices. Moving at the speed of bureaucracy, changes in a patient's eligibility status may not reach you until weeks or months after the change. By then, you may have provided services to patients who aren't covered.
“Sometimes you see a patient in February, and in April you get a notice that he was no longer active as of Jan. 1,” says Lee B. Sacks, MD, a member of the Academy's CHCS and president of the Oak Brook, Ill.-based Advocate Health Partners, which connects nearly 2,000 physicians in eight PHOs and two multi-specialty medical groups with an integrated delivery system. “The health plan deducts those three months of capitation it paid you, and you go back and try to bill the patient. In our experience, we never collect that money.” Staying on top of changing eligibility information can go beyond having your receptionist ask patients whether anything has changed since the last visit. At The Liberty Clinic, patients waiting in exam rooms review printouts of their demographic and insurance information and make whatever changes are necessary, says administrator Gary Coulter.
Of course, many patients don't know the details of their coverage — or even the names of their insurers. So your staff also needs to monitor eligibility updates from managed care plans. Whether the updates arrive weekly or monthly, “it's absolutely critical that somebody in the office checks the demographics on all your patients in those plans and notes changes in the patients' records,” Schryver says. “Otherwise, you're going to be providing free services, and your accounts receivable will go through the roof.”
Your staff also can prevent problems by calling your plans to check the eligibility of patients scheduled to be seen the next day. “A few phone calls can save you a lot of money,” says Michael Gordon, health care delivery systems manager for the AAFP.
Another option to help relieve eligibility hassles is an outside verification service. Many companies that provide electronic data interchange for claims submission also offer online, real-time eligibility verification. At the practice's end, these systems range from small counter-top terminals to software integrated into practice management systems.
Perhaps most important, try on the front end, in your MCO contract negotiations, to limit the amount of free care you provide. According to Ashbach, contracts should specify that if an MCO verifies a patient's eligibility for services on a certain date, the MCO must pay for that care — even if it turns out that the patient's coverage had changed but the employer hadn't yet notified the MCO.
Advantages of integration
In the same way that integration can mitigate patient-care hassles for practices with many plans, it can make the administrative side of managed care easier. If health care continues moving toward higher concentrations of managed care, integrated models such as large groups, IPAs and provider-sponsored networks may represent family physicians' ticket to ride.
A fundamental advantage of integrated organizations is an economy of scale for major purchases, such as the sophisticated computer systems that smooth so many bumps in managed care. For example, Soper has led the development of a primary care IPA in the Kansas City area, Metropolitan Physicians Alliance, LLC, and one of its priorities is obtaining a state-of-the-art information system to connect its members' practices. The IPA also helps its members get preferred vendor relationships with providers of credentialing, collection and electronic claims processing services, among others.
The greater the integration, the more managed care hassles individual practices can avoid. Advocate Health Partners' PHOs function as super-MCOs, at least in the eyes of the doctors. Their services include these headache relievers:
Credentialing. The health plans have delegated most of their credentialing activities to Advocate, so its physicians complete a single application and undergo site reviews only by Advocate.
Patient eligibility. With one phone call, practices can verify eligibility for patients in all the plans Advocate contracts with. “And we guarantee it,” Sacks says. “If we tell an office that someone's eligible, we'll give them the payment even if it turns out that there's been a retroactive delete.”
Claims and reimbursement. Advocate's physicians send all their managed care claims to a single office, the system's management service organization, and Advocate pays the claims. So when problems arise with payments, “practices only have to call one place, and over time you get to know the people on the other end of the phone,” Sacks says.
Integrated organizations also make possible a critical aspect of profitable managed care practice, Schryver says: activity-based costing. When practices negotiate reimbursement arrangements with a variety of plans, they have to know the bottom-line payments they can accept and still stay in the black. In a solo practice or small group, “the physicians don't have anyone in their offices who can do cost accounting and tell them exactly what it costs to deliver a certain service,” Schryver says. “But if you become part of a larger group, you can have access to people with that kind of administrative and accounting expertise.”
A new kind of patient education
Administrative hassles aren't limited to forms and numbers. With managed care constantly changing, family physicians find themselves being expected not just to work within wide-ranging systems but to teach patients how to do it, too.
Many physicians understandably feel this isn't their job, arguing that plans are responsible for educating their members and, ultimately, that patients are responsible for understanding the products they buy. But some experts say teaching patients about managed care is in the doctor's best interest.
“In practical terms, practices have to do it because they're the ones who aren't going to get paid if the patients don't understand their plans, not the insurance companies,” Schryver says. He recommends that practices make clear to patients what services they can and can't provide. Larger groups, those with six or more full-time physicians, should have “patient account representatives” on staff. “They're the insurance gurus who meet with all new patients and go over what their insurance covers, the patient's financial obligations to the group and the group's expectations about payment,” he says.
Another option is to go to the patients instead of waiting for them to come to you. If a large proportion of your patients work for a major employer in your community, Gordon says, you may want to have a staff member offer sessions there to explain to employees how their managed care plans work.
In the spirit of traditional patient education materials, some practices develop handouts summarizing plan provisions that patients need to know. According to Kelly Semmelroch, administrator of Lewerenz Health and Wellness Center in Warren, Mich., these handouts present “what patients' responsibilities are and what their plans state they should receive” — such as how many visits they may make without charge, requirements for physician approval of continuing physical therapy and the frequency of wellness physicals. The handouts are customized by plan.
“We outline the plans for the patients so there are no hidden surprises, so they're as responsible for being treated within the guidelines of their plans as we are,” Semmelroch says.
But other practices have found that the hassle of preparing and revising plan handouts outweighs their value. “We've backed away from trying to be too detailed about the individual benefits and requirements because there are just too many,” says Berdi Safford, MD, a family physician with Ferndale Family Medical Center in Ferndale, Wash., and a member of the Academy's CHCS. “It's no longer vanilla, chocolate and strawberry.”
For Waddington, the key is to develop cheat sheets outlining plans' requirements — or better yet, include that information in a good computer system — so staff who deal with patients can have plan information at their fingertips. She says expecting patients to know their own plans isn't realistic: “The physician is the only one who's financially motivated to manage care. The patients aren't, at least not those in plans that pay everything except for a $5 co-pay. ‘Let it be someone else's headache’ — that's the attitude patients take.”
Getting back on the same team
Having to explain to patients what their insurance will cover illustrates what some see as the biggest hassle of managed care: It can add confrontation to the physician-patient relationship. “The plans generate so much confusion for the patient and the doctor about what services are and aren't covered that it becomes almost an adversarial situation,” Thorson says. He notes that if patients see their physicians as deliverers of services rather than healers, patients will be more likely to sue when the outcomes of those services aren't what they expect.
Unfortunately, cheat sheets and computers won't help here. “It's the old communication issue,” Thorson says. “The key to making this work better is that physicians or staff need to spend time explaining to patients how managed care works, how problems can arise and how patients and practices can make it work together. Patients are even more confused by managed care than we are, and they're willing to work with us. Using good communication, you can put yourself and your patients back on the same team.”
John Spicer is an associate editor of Family Practice Management.
Copyright © 1998 by the American Academy of Family Physicians.
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