Practice Management

Whether to appeal or resubmit a denied claim

Q Health plans, with increasing frequency, are kicking back clean claims as incomplete. As a result, my staff spends an inordinate amount of time re-examining claims and refiling them—often with the same support documents that were originally included. Now we're wondering if it would be better to initiate the appeals process as soon as a claim is denied, instead of going through the hassle of resubmitting it. What do your consultants say?

A You're being treated improperly if the insurer is repeatedly rejecting clean claims. Request a meeting with a plan representative and present documentation proving that the claims were clean. Demonstrating that you understand what's going on may convince the plan that it's in its interest to process your claims correctly.

If the meeting doesn't solve the problem, write a letter to a top official at the health plan, with a copy sent to your state's insurance department. If that doesn't produce results, then the best option may be to resign from the plan.

Polite ways to cut short talkative patients

QSometimes I get held up in an exam room by a patient who just wants to talk. How can I finish the visit without offending the patient?

A Consultants suggest the following tactics:
• Recap instructions.
• Arrange for a nurse to call you away to answer an "urgent" phone message.
• Advise the patient to make another appointment if further medical problems need to be addressed.
• Politely tell the truth—that you have other appointments to keep.

When an IPA strong-arms your practice

QAn IPA my practice belongs to began levying a $500 monthly penalty on us last year because we contract with health plans outside of the IPA. Naturally, we balked at the new policy because the association didn't require exclusivity when we joined five years ago. But we reluctantly decided to pay the penalty because the IPA gives us access to hundreds of patients we wouldn't otherwise have. Plus, we don't want to abandon these patients.

What should we do?

A Check your contract, for starters. If it doesn't explicitly allow the IPA to do this, then don't pay the penalty, and tell the IPA why.

If the contract is vague on this point or specifically calls for penalties, ask your attorney or the US Department of Justice to investigate whether this policy violates antitrust laws.

Finally, consider two broader issues:

• Did the IPA enact this policy in response to its own financial instability? To find out, ask the association to give you audited financial documents. If it looks as if the IPA is in trouble, it may be a good time for your practice to bail, anyway.

• Does this IPA send you patients whose plans pay well? If not, you may not lose much revenue from dropping the IPA.

The dollar value of your patient records

QI'm selling my practice, and I want to keep the valuation as simple as possible. Can't I just assign a dollar value to each patient record? What amount is customary?

A Consultants say $6 to $8 is typical, but caution that this isn't the best way to set a price tag for your practice. Hire a practice management consultant to guide you through the process.

When it's time to raise your fees

QI'm a family doctor in private practice. How should I determine what fees to charge for various levels of service, and how often should I increase them? Will insurers pay me more if I charge more?

A Peg your fees at 115 to 200 percent of what Medicare allows—depending on the norms of your community—and make sure to update your schedule every January when the new Medicare rates go into effect. Insurers will pay either their fee schedule or yours—depending on which is lower. So your rates should always be higher than the plans'. If a health plan starts paying you 100 percent of what you charge, it's time to raise your fees.

How much support staff do you need?

QOur 12-doctor internal medicine practice sees 20,000 patients a year. How many nonclinical support staff does it take to make our office run smoothly?

A Our consultants recommend two and a half to three and a half full-time staffers (or a combination of part-timers) per physician. For your group, this translates to:
• Two administrative managers.
• One secretary to the administrators.
• Four receptionists.
• Three phone operators.
• Three collections staffers.
• Two billing personnel.
• Four insurance specialists.
• Four cashiers.
• One to two janitors.
• Five medical records custodians.
• Three to four staffers to handle referrals and preauthorizations.
• Four to handle dictation.

Compensating a founding partner who's preparing to retire

QI'm getting ready to retire from the five-doctor family practice I founded more than 25 years ago. The partners have always been paid the same salary. But now that I'm scaling back, the group is struggling to come up with a compensation formula that factors in both my lighter patient load and my continuing administrative responsibilities. Can your consultants recommend an equitable formula?

A Start by prorating your salary based on the percentage reduction in your office hours. In other words, if you cut your hours by 30 percent, you'll earn 70 percent of your salary. Then deduct $500 a day for every day you stop taking call. If you spend a lot of time performing administrative duties, negotiate a fair hourly rate for that time, keeping in mind that administrative work shouldn't pay as much as clinical work, and that the other doctors in the practice may also perform administrative duties.

Promote a staffer who's often out sick?

QA nurse who's been with me part time for one year wants to work full time to get health benefits. Although she's a good worker, I don't want to make her full time because she takes frequent sick days—either for her own illness or her daughter's. What's a fair way to handle this?

A If she's a good worker and you need a full-time nurse, give her the benefit of the doubt and convert her to full-time status. It's unfair to offer paid sick leave and then be irritated when an employee uses it. If she's absent more days than she's allocated, you should deal with the problem as specified in your office policy manual.

Edited by Kristie Perry,
Contributing Writer

Do you have a practice management question that may be stumping other doctors, too? Write: PMQA Editor, Medical Economics magazine, 5 Paragon Drive, Montvale, NJ 07645-1742, or send an e-mail to mepractice@medec.com (please include your regular postal address). Sorry, but we're not able to answer readers individually.

Kristie Perry. Practice Management.

Medical Economics

2002;4:108.