- Health Care, Drugs & Insurance
Sending Your Medical Bills To A Factory! How Does Your Doctor Get Paid? How To Get That Bill Paid!
After You See The Doctor, What Happens To The Bill?
When you finish your doctor's visit, your doctor's office sends your bill to your health insurance company in the form of a medical claim. It is rarely sent by mail, instead is is sent through what is called electronic billing. Your vital information, as well as diagnosis, type of visit, the physician's charge and the doctor's vital information is sent electronically to your insurance company claims factory along with many, many others. Everything is coded, with numbers that computers recognize. There is a code number for each diagnosis, each procedure your doctor performs and every different type of visit. Yes, your bill is sent to a factory. Once your bill reaches the claims factory(or claims processing center), along with many others, each insurance company has what they call edits and audits. If your medical bill passes through all of these edits and audits with nothing that signals a red flag and nothing that automatically rejects your claim, the doctor gets paid. The workings of a claims factory is probably very boring to most people, but the workings can be enlightening.
Every medical insurance company has their own edits and audits and they are confidential. They can range from the most simple, such as whether or not you are eligible (your insurance is active and you have coverage) to as complex as whether you have exceeded the number of visits to the doctor for the diagnosis that your insurance carrier deems appropriate. Let's say for example, that you have a simple cold. Your insurance company has guidelines for how many visits are reasonable for a simple cold. For this example, you have seen the doctor five times for this cold and your insurance company thinks four visits are normal for a cold. When the fifth bill comes in, the built in audits will kick that bill out. A computerized report will be electronically sent to your doctor requesting more information. If the information requested is returned, it meets with the approval of your carrier and your claim is able to pass successfully through the rest of the edits and audits , your bill will be paid. If the information is insufficient, or if the bill fails to pass through the remaining edits and audits, your claim will be denied. Your claim, at this point, can also be pended, for up to 45 days. Then when the reprocessing begins, it can be pended again, for hitting a different edit or audit. Each time a claim is pended, it starts all over again. The longest I have seen an individual claim pended is 2 years, not for just one reason, but for many.
There are many reasons for pending or delaying claims. Sometimes, the insurance company has reached its claims budget for the month. They do have monthly budgets. If the company has gone over their budget, this is where the bill can be pended (or delayed). It usually happens at the beginning of the claims process and you or your physician will receive some type of communication saying that further information is needed or the bill is being pended (delayed) for additional information. They don't tell you the real reason that the bill is delayed. They always make it sound as if there is something you or your doctor did not provide them with. They are experts at delay tactics and strategies, especially when they run short on money. Insurance companies are notorious for reducing the number of processed and paid claims during the months of November and December. Ask any medical professional. They will back this up. The doctor's office will receive significantly less money during those two months of the year. Hospitals, as well, see their payments dry up during the final two months of the year. Even when claims were processed by hand, this holiday hiatus was the tradition and every medical provider is prepared for a dry holiday season.
Back in the early '90's, their was a small claims facory in Florida that handled only 100,000 patients. They managed to legally pend every single claim that came in for two years. They never paid a claim and then the company sold the patients' contracts for 15 million dollars to a large insurance company. It was a very profitable endeavor started by 5 investors who had come in with $20,000.00 each. 100K investment, pay no claims and make 15 million?
The Claims Factory And Its Lowest Paid Employees
In a claims factory, there are employees that are charged with entering information received on paper claims. Not all doctors send their claims electronically. Some still send paper claims. They take longer to process and because they are handled by multiple people, the error rate increases. All claims factories have a mail room. Every piece of paper that comes in is sorted according to the date received (called the Julian date) and given a number that identifies it. The pieces of paper are then placed into piles that usually consist of 100 pieces. The batch of 100 pieces of paper is then given a batch number. The ID number and batch number will be combined with the Julian date and then scanned. From there, the batches go to data entry employees who enter the information into the computer system. If the claim is sent with the correct codes and the data entry employees enter the data correctly, the claim will be processed and paid the same way that the electronic claims are.
Employees in the mail room and the data entry employees have traditionally been the lowest paid of the insurance company industry. That may still be true in this country, but now many insurance companies have outsourced much of the customer service department to foreign countries. They are now the lowest paid employees. Those are also now the two areas that have the highest error rate. If your insurance company has outsourced customer service, you will get poorly trained, medically uneducated customer service representatives assisting you.
Customer service representatives at a claims factory are divided into two units, the phone representatives and the correspondence representatives. The telephone reps (often in a foreign country) are next on the totem pole in regards to pay and training. Prior to complete automation and outsourcing, the customer service representatives were technical employees, spending up to three months in comprehensive training, learning everything from contracts to coding, in addition to claims adjustments. Some were promoted, based on ability and testing to the written correspondence unit and some went to the adjustment department where claims denied incorrectly were reviewed individually and paid. The insurance company claims factories that still employ domestically are still divided in this manner.
When you call the customer service number on the back of your card, you are now reaching the least trained group of employees in all cases. They must answer a certain amount of calls each day (a quota) and very often, give incorrect information. When consumers call into the customer service line, they should request a case or call number. That is the only way that a call, if it requires follow-up, will be documented. Otherwise, when that rep tells the consumer that their problem will be resolved within 30 days, there is no record of the call 30 days later and the process begins again.
Network Management, Supervisors and Provider Management: The People To Reach If You Have A Problem
For consumers, there is a way to bring any claims payment issues to resolution. It is simple: Speak to a customer service representative. Explain the issue to the rep and then ask how long it will take to resolve the issue. When the rep states that it will take up to 30 days, immediately ask to speak to a supervisor. Tell the supervisor that you want an 'expedited review'. Those two words carry great significance. They decrease the amount of time that the insurance company has to finalize your claim. When you utter those two words, your medical insurance company is put on a legal stopwatch. They now have, instead of thirty days, up to 72 hours to resolve your issue.
Medical providers very rarely speak with customer service representatives. They speak to highly trained employees of the medical insurance company. They almost always have their complaints handled by network or provider management and in many instances these managers are not located in the claims factory. These are well-paid and knowledgable employees. Each area or region usually has a few network managers. The same employees will most likely handle your doctor's complaints every time. If the manager in your doctor's office is personable and friendly, he or she can resolve problems while on the phone. Network managers and Provider Service Managers have the authority to cut through the red tape and pay a claim at once if they so desire. It is in your doctor's best interests to be friendly. Once they have established a cordial relationship, claims payment gets easier.
Some providers (in this case, a large hospital) have managers that are able to negotiate multi-million dollar payments by simply making one call. Those managers have taken care to establish good working relationships with the people in power.
An Overview To The Claims Payment Process
The above is written to explain what happens when a physician's bill begins the claims process. There are many other employees in a claims factory. The above are the most significant employees that are hired to handle or mishandle a doctor's bills. Hospital bills can be processed much differently, but that process is insignificant in this walk-through of a medical claims factory and the manner in which they treat professional claims.
As a side note: I have written many articles on health insurance and have recently noticed that some of those articles have been reprinted, without permission, without being attributed to me. One of the sites that is guilty of this is a foreign company currently being investigated by their own country for fraud. They are using one of my articles, with my name removed, to entice people to sign up for their services. Please be cautious when seeking assistance with your health insurance problems. Not all companies are above board. If they steal writing, imagine what they will do with your money!