Year-after-Year CPT® Contract Allowables Go Down and Costs Go Up.

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Deteriorating, that&rsquo;s the best way to describe your contracts and allowables. Dismal is a very close 2^nd.</p>
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There are thousands and thousands of CPT&reg; codes and hundreds of insurers and plans. All pay varying amounts. Few practices can deal with this situation. The insurers have armies of staff and physicians only a few staff, already overworked to exhaustion and barely keeping their heads above water.</p>
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Health insurer contracting and billing represent the major sources of administrative burden for physicians. Physicians spend an average of 142 hours a year interacting with health insurers at an estimated cost of $31 billion, or $68,274 per physician, according to a national study of doctors and medical group administrators that appeared in the journal Health Affairs.</p>
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The physicians contract is at the center of the reimbursement issue; specifically &ldquo;payment terms.&rdquo;&nbsp; This has been unmanageable for many physicians; it&rsquo;s not that they don&rsquo;t care; it&rsquo;s that their practices have turned into revolving doors to try and keep up with declining reimbursements and the demand for healthcare. You&rsquo;re likely to see 10-30 patients today.</p>
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The focus for physicians, regarding contracts, has to be on (1) payment terms (allowables) and any proposed changes (year-to-year), (2) payer reimbursement compliance, and (3) physician fee vs. contract allowable.</p>
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Managed care contracts are one of the most important drivers of a healthcare organization&rsquo;s financial reimbursement, cash flow and profitability. A well-developed managed care contracting strategy is integral to understanding, planning for, and controlling revenue streams. The effective use of analysis can lead to major revenue enhancements and overall improved financial performance for your practice – without necessitating any changes in day-to-day operations.</p>
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Consider this, a family practitioner can spend up to an hour with one patient and be reimbursed in the area of $75.00; factor in expenses and you see the problem.&nbsp; At the end of the day physicians must identify and manage these contracts.&nbsp; It is no longer sufficient to trust their income to others.</p>
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Would you choose $628,000 or $756,000 in office visits? Easy answer! <a href="http://www.codetoolz.com/wordpress/2012/millions-in-office-visits-2/">See how</a>.</p>
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Healthcare financial managers should be prepared to assess their portfolio of managed care allowables because preservation of the current portfolio may lead to deterioration of the organization&#39;s financial and service position.</p>
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Data and technology are essential to evaluate physician&rsquo;s managed care contracts and allowables. Continuous performance and process improvements are critical to the vitality of any organization. Providers continue to be challenged with this issue.</p>
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Our focus during this discussion has been on dealing with the current managed care environment as it relates to &ldquo;allowables&rdquo;. Is the payment methodology itself broken? More to come&hellip;..</p>
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<strong>About the Author</strong></p>
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Dana R. Bellefountaine Jr. is the President of CodeToolz. Dana began his healthcare career in 1985 as a surgical assistant in the U.S.A.F. that led early on in his career to gaining expertise and knowledge of physicians, medical practices, hospitals, and most importantly &ndash; revenue.</p>
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With his degrees in finance and accounting, Dana began managing, consulting, marketing, developing, and evaluating medical practices on a national basis. Dana brings two decades of progressive experience in finance and management to CodeToolz.</p>
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Financial impacts on health care providers are particular areas of focus. He is an industry expert at analyzing shortfalls within contracts, reimbursements, evaluating and negotiating managed care contracts, and evaluating financial data.</p>
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He has been a pioneer in the development of medical practice networks, physician organizations, and specialty MCO&rsquo;s on a national basis. He has authored, as well as contributed to articles that have appeared in several national healthcare publications throughout the years.</p>
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His speaking appearances evolved into consulting opportunities, and his consulting naturally led to physician practice management services.&nbsp; This prompted him and his team to develop the CodeToolz web-portal. <a href="http://www.codetoolz.com/">www.codetoolz.com</a></p>
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<em>CPT&reg; codes and descriptions are copyright 2010 American Medical Association. All rights reserved. CPT&reg; is a registered trademark of the American Medical Association (AMA).</em></p>