Tips for Billing Managed Care and Commercial Insurance in Home Health

Historically, the home health industry has largely been driven by Medicare payments, and agencies have been hesitant to turn to managed care and commercial insurance to drive additional revenue.

It’s understandable, as the process to seek and secure payment outside of traditional channels can be overwhelming, said Lynn Labarta, CEO of Imark Consulting, a home health and hospice billing company. But considering that some agencies she’s worked with have seen increases in revenue by 20% to 30% by getting over the fear of alternative payment sources, it’s certainly worthwhile, especially as Medicare increases regulations and compliance measures.

“Due to all these changes, it’s really important to consider alternative sources of revenue,” Labarta said Wednesday during a Complia Health webinar hosted by Home Health Care News.

As such, it’s time to get the ball rolling on contracting with managed care and commercial insurance companies and processing claims for a greater swath of patients, she said. The following are tips to take into account to maximize payment diversification.

Contracting With Insurance Companies

First and foremost, home health agencies must pinpoint the specific insurance companies with which they’d like to partner, if they wish to become in-network providers.

– Find out what insurance companies operate nearby. There will be big players like Aetna or Blue Cross Blue Shield that are more obvious, but there might be smaller, more local companies that could be ideal for contracting, as well.

– Apply online via the company’s website, or call directly to begin the enrollment process. It will take time, Labarta said, but the application process is hardly complicated.

– Ask insurance companies several important questions, including whether they accept electronic claims, what the timely filing deadlines are and what type of claim form should be used. This type of information isn’t always in the contract, according to Labarta.

– Make sure staff is aware and educated on accepting commercial and managed care plans.

Eligibility

Determining a patient’s eligibility to receive services at a specific home health agency is equally important, and the next step in billing managed care and commercial insurance companies. Not properly performing eligibility checks could lead to providing services that aren’t covered and won’t be reimbursed.

– Understand the difference between commercial insurance and Medicare HMOs. “Knowing the type of insurance plan the patient has is going to help you understand the process you’re going to follow in the office,” Labarta said. Also, try to obtain a copy of a patient’s insurance card, so that workers can identify the type of plan and process billing accordingly.

– Since many plans don’t cover home health care, ask insurance companies up front whether they do. Also determine whether the companies accept claims from out-of-network providers. These pieces of information help agencies make a decision on whether to admit a patient or not.

– Figure out whether authorization is required by the insurance company. Most commercial insurance plans are going to require authorization, while the majority of Medicare HMOs are not, according to Labarta.

– Pinpoint patients’ deductibles and copayments. It’s up to home health providers to collect both, so it’s important to be aware of what’s due.

Billing Process

Getting a handle on the billing process can mean the difference between approved and denied claims.

– Avoid paper billing, if possible. Electronic billing is the most efficient, Labarta said, but it requires that agencies follow certain protocols. For example, some insurance companies require providers to fill out an electronic data interchange (EDI) application if using their own software. Otherwise, claims can be submitted through a clearinghouse or directly through the company’s portal.

– Pay attention to timely filing deadlines. Agencies must know when it’s too late to submit a claim, and establish billing cycles that make sense for the type of insurance, Labarta said. For commercial insurance, it would be beneficial to bill weekly or monthly, while for Medicare HMOs, episodic or monthly billing is more reasonable.

– Follow up on submitted claims within two weeks. Without a timely follow-up process, home health agencies will stumble across reimbursement issues and cash flow problems, Labarta said. The key is to have billers who are properly trained and familiar with each step of the insurance company’s billing process. Follow ups can be done by phone or online.

Denial Management

Until processes are fine tuned, denials are inevitable, so it’s necessary for home health agencies to manage them accordingly, and use errors as learning opportunities.

– Make a phone call to determine exactly why a claim was denied. Since most denials are related to billing errors, there might be an easy fix once mistakes are identified, Labarta said.

– File corrections within seven days to avoid going over timely filing deadlines and losing the payment altogether.

– Prioritize follow-up efforts. Since the goal with billing managed care and commercial insurance is to bring in more revenue, seeing claims through to completion is crucial. Deal with the easiest to correct or those with the highest dollar volumes first.

Written by Kourtney Liepelt