Calculating five types of typical underpayments.
Underpayments to providers under their payer agreements are a cause of many thousands of dollars in lost revenue. Providers should devise a plan to make certain that payments made to them are accurate, on time, and adhere to other contractual obligations. The importance of developing and implementing such a plan is substantiated by the fact that nearly 100 percent of a provider's commercial business is under contract. As a starting point, providers may wish to focus on five common types of underpayments: underfunding due to late payments; fee-schedule changes that are contractually disallowed; miscalculation of performance-based bonuses and errors in risk-payment reconciliations; inappropriate denials or inappropriate downcoding of claims; and non-payments. The successful execution of a plan to identify and resolve problems and recover payments owed relies on the provider's ability to document and prove that payment is due.
Welter
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MedTactics, Arlington, Virginia, USA. terriwelter@medtactics.com
Stevenson
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D000067:Accounts Payable and Receivable; D003284:Contract Services / Q000191:economics; D005245:Fee Schedules; D005375:Financial Audit; D005377:Financial Management, Hospital / Q000379:methods*; D006801:Humans; D007344:Insurance Claim Reporting; D007345:Insurance Claim Review; D007349:Insurance, Health, Reimbursement; D008329:Managed Care Programs / Q000191:economics*; D020414:Risk Sharing, Financial; D014481:United States