As managing partner of my practice, I know firsthand the many challenges physicians face in the day-to-day business of keeping a medical practice afloat.
One of the biggest consumers of time and resources is securing claims payments from health insurers. And it’s a process that has become even more taxing thanks to a relatively new form of payment that puts money back into health insurers’ pockets at our expense.
The entire claims payment process is a challenging one. At my practice, we have 22 billing staff to support the clinical work of 17 physicians. They’re busy not only submitting claims but trying to figure out what’s happening to them once they’re out the door—we don’t always know whether the claims were received, where they are in the process or why they are denied. Then there’s the challenge of addressing claims that were paid incorrectly—an all-too-common problem with many insurers.
The AMA continues its aggressive efforts to improve these issues by advocating for key changes before the federal government and with standard-setting bodies.
At the moment, one of the most pressing issues is virtual credit cards, a payment form that is gaining popularity among insurers over the standard electronic funds transfer (EFT) transaction and paper checks.
The problem is that while insurers get cash-back rewards from paying this way, we physicians are charged fees per transaction—typically 3-5 percent of the total payment. So an insurer may owe $5,000. But if it’s paid with a virtual credit card, the physician could lose up to $250 in fees. Whether you’re a practice owner or an employed physician for whom payments impact productivity calculations, these fees can add up quickly.
At the same time, these payments take practices more time to process. They require manually entering information, correcting entry errors and reconciling the payment with a separate claims remittance advice.
We recently explained this situation in testimony (log in) to the National Committee on Vital and Health Statistics, an advisory board to the secretary of the U.S. Department of Health and Human Services (HHS). And we’re pressing HHS to issue additional guidance. Just a few weeks ago, we sent a letter alongside three other leading organizations, calling on the agency to prohibit insurers from forcing physicians to accept this form of payment.
We also urged the agency to require insurers to give full upfront disclosures of associated fees, obtain physician authorization before implementing virtual card payments and ensure an easy opt-out process if a physician later chooses not to accept this form of payment.
While we’re working on this issue, you can take action now to protect your practice. It’s your right to request insurers to pay via the EFT standard transaction, which works like direct deposit and can cut down the time your staff spends on processing paper checks. There are two easy ways to learn more:
- Our EFT toolkit gives guidance about physicians’ rights regarding electronic payments, the effects of virtual credit card payments, and the ins and outs of EFT payments.
- A continuing medical education session, “Stop paying to get paid: Effective electronic payments,” will take place at 10 a.m. Nov. 10 as part of the 2014 AMA Interim Meeting in Dallas. Among the speakers will be a national electronic payments expert.
If you aren’t familiar with these issues, now’s the time to learn more. It will save your practice time and money that can be better invested in patient care.
