Commercial insurance companies regularly change their claims processes. This complicates the billing process and can lead to medical appeals. Since clinics and hospitals only receive three of these appeals on the state level, those rejected claims can add up and cause financial issues. Hospitals and clinics in financial trouble can go bankrupt and shut down, or they are left susceptible to takeovers.
Changing the Claims Process
Changes can occur in the claims process at any given time. Recently, Blue Cross and Blue Shield of Texas was set to change the claims process for patients on HMO (health maintenance organization) plans. When they went to an emergency room for care, they would have been billed differently – and the billing department of the hospital running that E.R. would have to change how they bill Blue Cross and Blue Shield. The impact would have been huge, especially since the billing department personnel had to note the date of the claims change and adjust everything from that point onwards. Thankfully, Blue Cross and Blue Shield backed down slightly and decided to wait an additional 60 days before the new claims process took effect.
Why do commercial insurance companies change their claims processes? There are many reasons. Some relate to new contracts with hospitals and clinics. The insurance companies may change their terms, billing codes, or even amounts. However others, like the switch made by Blue Cross and Blue Shield in the example described here, are done when the insurance companies’ internal policies change. It all depends on the company’s leadership.
How the Claims Process Affects Medical Billing
These changes to the claims process effect medical billing in a very negative way. It makes it much likely that medical appeals will need to be filed when those initial claims are rejected. When the claims billing process changes, the first people to be affected are those in the hospital billing department. They need to make some adjustments in how they bill those claims. If they aren’t immediately informed of the changes, then they’ll use the old process, causing them to be rejected and put into the medical appeals process.
As an additional complicating factor, many of those claims process changes only affect certain groups of patients. In the Blue Cross and Blue Shield example, only those on an HMO plan had their process changed. Other patients with plans through that same commercial insurance company stayed the same. This just makes it tougher for the medical billing employees, who need to sort out which patient is on which type of plan in order to invoice those claims correctly.
What Happens To Medical Appeals
The medical appeals process itself causes some complications. When those claims come back unpaid or underpaid, the billing employees need to look up the contract terms that they fall under. If it were just one or two of these claims per day, that wouldn’t be a big deal. It wouldn’t take much time to look them up. However, some hospitals are getting hundreds of these rejected claims sent back per day. On top of this, there are numerous different contracts to look up. Some depend on the particular doctor or procedure. Others cover entire departments. Now imagine those three circumstances and multiply them by the number of commercial insurance companies that operate in a certain geographic area. As you can imagine, this causes quite a situation, especially when the claims process changes regularly.
When the unpaid or underpaid claims are sent back to the clinic or hospital, they can only be appealed three times at the state level. There may be times when a portion of the claim is paid; then it’s appealed, only to have it rejected. On the third try, another portion of it may be paid. The end result is an underpaid claim, which ends up getting placed in the bad debt column of the financial ledger. All of this, because the claims process changed.
After Those Initial Medical Appeals Are Exhausted
Medical appeals can wreak havoc on your bottom line. Hospitals and clinics have a lot of bills to cover. They need to pay their employees, cover the costs of new and improved equipment, and make sure that the utilities stay on. They also need to keep their buildings (and parking lots) clean, ensure that they have all of the necessary supplies, and even put new (non-billing) processes into place, such as those that connect all of each patient’s records from various departments. It’s not good to have millions of dollars sitting in a debt bucket. This is what leads many hospitals to go bankrupt. They end up with too many unpaid medical appeals and not enough cash flow. They need to find a way to collect on those unpaid and underpaid claims.
The main issue is that many of the people in charge of these hospitals don’t realize that there’s a better solution. They don’t teach people about the Federal ERISA process in law school or even in your typical medical billing course. Because of this, the process flies under the radar. Many clinics don’t realize that they have this option until it’s too late to do anything about it. They start the bankruptcy or restructuring process, only to find that had they filed Federal ERISA claims months beforehand, they’d be in much better shape today.
There Is Another Option
There’s a useful solution to those rejected medical appeals – the unpaid and underpaid claims that are sitting in your clinic or hospital’s debt pile. It’s called the Federal ERISA process. ERISA is short for Employee Retirement Security Income Act. This federal statute covers several different things, including commercial health insurance companies that offer self-funded employee plans. According to the law, those companies must pay the claims from those medical appeals. The main issue is that many people, especially the ones employed in your billing department, don’t know how to file the necessary paperwork to get them to pay up. Even if they did, those same employees are so busy balancing the state-level appeals and current claims that they don’t have the time. Thankfully, there’s an option – a company like us, ERISA Recovery. We train our employees on every aspect of the Federal ERISA process. As a result, we can get that money for you. We even have a guarantee in place. We can recover one million dollars of those claims for you in a 12-month span, as long as we receive all of the right paperwork from you.
ERISA Recovery Can Help
If you have medical appeals that have piled up and are sitting on the wrong side of your balance sheet, you need to call in the experts at ERISA Recovery. Our employees understand the Federal ERISA process and can clear up those old unpaid and underpaid claims. On top of that, we don’t charge anything upfront for our service. If you’re ready to see what we can do to help your hospital or clinic, thanks to the Federal ERISA process, give us a call at (972) 331-4140 or fill out the contact form on our website. Once we receive your information, one of our experts will give you a call.