Independent physicians and medical laboratories often struggle to collect payments because of complexities in the billing process. Insurance companies require different formats and amounts of information from doctors. For billing purposes, physicians must use the correct codes for Current Procedure Terminology (CPT) and International Classification of Disease (ICD-9). The codes and federal and state regulations change frequently, further complicating the billing process for health care providers.
Some doctors are often too preoccupied with serving their patients to chase down outstanding payments they are owed and clear up other billing problems.
Physicians and medical labs that do not follow the correct format, coding procedures and state Medicare and Medicaid regulations can end up fined or in jail, said Adrian Velasquez, president of Fi-Med Management Inc.
Fi-Med, a Milwaukee-based financial management firm, has taken on the tedious billing and collection process for physicians and medical labs that choose to outsource their accounts receivable departments, Velasquez said.
"Medical billing is very different than billing for manufacturing or other types of billing," said Dr. Thomas Clark of Thomas J. Clark, DOPC, a Fi-Med client in Fort Mohave, Ariz. "There are a lot of regulations and the regulations are changed by the federal government on a monthly basis at times."
To assure compliance with the Center for Medicare and Medicaid Services (CMS) and the American Health Insurance Portability and Accountability Act (HIPAA) guidelines, Fi-Med employs a certified compliance officer, a certified compliance consultant, three certified professional coders and a security officer. Most employees at Fi-Med have accounting degrees, Velasquez said.
Fi-Med automated its billing processes with software that keeps employees up to date on new regulations and changes in coding procedures. The company also transferred paper-based files and procedures to an electronic and Web-based database, Velasquez said.
"We are bringing business technology to the independent practice to increase cash flow and reduce compliance risks," Velasquez said.
Fi-Med was established by Velasquez and his business partner, Christine Krause, who serves as vice president, in 1993. The company launched its automated electronic process about five years ago and has continuously improved the system, Velasquez said.
"Now (data) passes through five servers, and we have taken bits and pieces of different software and integrated and automated the system," said Rosa Miranda, IT manager for Fi-Med. "What at one time took 36 steps to get from point A to point B now only requires the click of a button to go through."
With electronic databases, Fi-Med also is able to create detailed reports for its clients in nearly any way they wish to break their practice down, Velasquez said.
Graphs and charts that Fi-Med can create include charges in a certain period of time, receipts, collections, judgments for money, a profile of payments per month, CPT and ICD-9 code changes and whether a drop in revenue is due to a patient’s change in employer, health plan or if the problem is an internal inefficiency, Velasquez said.
"Smaller groups (of physicians) do not have business expertise," Krause said. "Through automation and reporting, we are able to help them understand what they need to do to be successful."
Fi-Med has clients in eight states and processes more than $70 million in charges annually, Velasquez said. The company’s Wisconsin clients and specialties include urologists, family practices, obstetricians and gynecologists, cardiologists, pediatricians, ophthalmology and Brotoloc Health Care Systems Inc.
David McGinnis is vice president of contracting and managed care for CBLPath Inc., an anatomic pathology laboratory in Mamaroneck, N.Y. CBLPath has used Fi-Med for billing purposes since June 2004.
CBLPath found that Fi-Med can offer speed and accuracy to the clinic, which is involved with cancer diagnostics and deals with a wide range of physician specialties, McGinnis said.
"We had an existing vendor when I joined the company (in 2003) that was not capable of handling what we wanted," McGinnis said. "We wanted to enhance the electronic service and be able to connect to their system electronically to scan tests and submit claims … Fi-Med improved our ability to manage our business."
Some physicians experience an increase in revenue of 3 to 5 percent just by plugging holes in the billing process, Velasquez said.
"It is unbelievable sometimes with carriers where we know we sent a claim out, and have a record of it, but they claim they have never received it," McGinnis said. "Without someone following up on the claims they would sit. We would not know that we had not been paid. Fi-Med determines which (bills) have been paid, which have not been paid and why."
Hiring Fi-Med has enabled Clark to have less clutter in the office and about two less employees, he said. When recording information about a patient’s diagnosis and the procedures that he performed, Clark fills in information on a form created by Fi-Med.
Fi-Med then sends the insurance claim on to the insurer and monitors when the payment is received.
"We were paid for billing (we sent out) the month we started with Fi-Med and still had not received payments from bills sent the month before. It was glaring right away," Clark said. "We experienced a two to three week turnaround after seeing a patient (and billing an insurer) where before it took six to eight weeks."
Fi-Med’s billing services range in price depending on the volume of claims and the amount of customization and services a practice needs, among other considerations, Velasquez said. A basic price for Fi-Med’s service is either $2,500 per month or a percentage of collected receivables, Velasquez said.
"Physicians that do their own billing can spend an average of $30,000 to $40,000 for their own software and hardware maintenance, and with us they don’t have to," Velasquez said. "Practices are connected to our server here, and we set up software that has real time data with no limit to the number of physicians or locations."
Elizabeth Geldermann is a reporter for Small Business Times. Send technology news to her at elizabeth.geldermann@biztimes.com or by calling her at (414) 277-8181, ext. 121. Technology news can also be sent to: Elizabeth Geldermann, Small Business Times, 1123 N. Water St., Milwaukee, WI 53202.
August 5, 2005, Small Business Times, Milwaukee, WI
