Undetected Third-Party Payor Reimbursement Errors

ASC Revenue Leak Tip

Another common area where revenue leaks occur is when payment posters do not identify incorrect third-party payor reimbursement. We touched on this when discussing denial management; however, it’s important to audit the accuracy of these payments on a regular basis as inaccurate reimbursement is becoming more commonplace. Auditing can also alert you to unwelcome trends by specific payors. Follow these tips to improve your effectiveness in catching reimbursement errors.

1. If your third-party payor contracts are loaded in your software program (which they should be to ensure payment accuracy), run a "contract compliance report" (or corresponding report in your software). This report compares payments to contracted reimbursement rates for each procedure by payor. It also shows the write-off for each payment. Reviewing this information allows you to determine the accuracy of the reimbursement and also if payment posters are catching errors and initiating necessary follow-up with payors. The report should also display contractual adjustments (write-offs) made for each payment. Checking adjustment data can alert you to incorrect adjustments or adjustments that have not been made and are inflating your accounts receivable.

2. If your contracts are not loaded in the software or your software does not have the capability to run a similar report, create an insurance matrix (cheat sheet) showing your insurance contracts and their reimbursement rates for common procedure codes. Spot check each payor for reimbursement accuracy.

3. If applicable, share findings with your payment poster and discuss corrective actions. If necessary, contact payor(s) to address negative reimbursement trends.

Access other tips in this series on ASC revenue leaks.

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