Revenue Leakage In Vaccines. The Preferred Partner. USA UK INDIA

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1 Revenue Leakage In Vaccines

2 Introduction Introduction There is no bigger expense with a lower return on investment for a medical practice than immunizations. In fact, you can even lose money giving vaccines. Robert Lamberts, MD, "Shot Through the Heart with Vaccines," Physicians Practice, July 2009 As much as 50% of the times, providers in the country are not being made whole by payers for carrying sometimes expensive but necessary vaccines in their inventory, according to a prime report. There are a host of expenses involved, aside from the outright cost of acquiring the vaccine, which just aren t reflected in reimbursement levels, under-reimbursement represents another hit in a long line of hits to the pediatrician s bottom line. The domino effect of under-reimbursing providers for vaccinations will be that fewer will order, carry, administer the very things necessary to prevent disease to control the spread of seasonal illness. was able to identify this problem for the practices that we services bring in simple automation to control the problem. Our client, a leading medical billing company operated across the West Coast with multiple offices. As it usually is, collections revenue maximization was at the forefront of their operations with they were able to identify vaccines as a cause of concern. s proactive approach in going to the root cause identifying that vaccinations were a cause of concern addressing it smartly by minimizing errors has really improved our revenues significantly. VP Medical Billing Organization Operations, Client Organization.

3 Critical Issues Results About The Client Quick Facts Critical Issues Vaccine Fee schedules were not honored 32% of the time Payments lesser by 37% of actual vaccine costs or allowed amounts Almost no stards in data audit verification Manual validation was needed on every vaccine code to identify these underpayments Results Performed a deep dive study on underpaid vaccine codes Detailed analysis to identify the revenue leakage as a % of total collections Built process automation to identify control the problem Error reports helped providers reconcile reimbursements with the Insurance providers About The Client The client is a reputed billing company based out of California consisting majorly of Pediatric, internal medicine surgery center clients. They also service Anesthesiologists, Pathologists Cardiologists. With collections of over $30 million every month, they are constantly growing very active in the M&A Quick Facts space too. They operate across the West Coast today follow very carefully thought out processes mechanisms to ensure collections are a top priority across the organization. One of their large clients, a pediatric practice with about $ 2 Million in monthly charges was on the radar the focus was to improve collections. Every dollar made an impact on the success of this practice our client engaged to analyze optimize the process identify areas of revenue improvement opportunity. Collections: $2,000,000 every month Locations: 10 across the west coast Specialty: Pediatrics Vaccines: 9% of total charges

4 Identification Of The Root Cause - Underpaid Vaccine Codes Identification Of The Root Cause - Underpaid Vaccine Codes Though the client was broadly meeting their profitability goals, there was always the need to improve given the increasing operational costs. s extensive industry expertise IP protected AR maturity framework earmm helped us isolate problem areas get to the root cause. The client billed out a total of $ 2,000,000 every month being a pediatric practice was administering a lot of vaccines. 9% of the total procedures performed were vaccine administrations. These ranged from regular Influenza, Hepatitis OPV vaccines to PPSV, HPV Combination vaccines commonly billed between $75 to $240. Considering that only 9% of the procedures were vaccines, this was commonly ignored without a fee schedule audit being performed. In some cases it was performed manually the resultant findings were minimal, hence ignored by the practice staff. As analyzed further leveraged data intelligence, there was a fairly large revenue leakage that was detected. 9% of the total billed amount for this practice in vaccines contributed to $187,100 in charges. A total of 1540 procedures billed were vaccine codes. 32% of these vaccine codes (490 vaccine procedures) were paid lower than the prescribed fee schedule. The differences between the fee schedule the paid amounts ranged from as low as $2.92 to $ This, though a seemingly low variance was traced to a total revenue loss of $27,870 every month, a whopping 37% of what was totally billed in vaccine codes. Annually this meant that the practice lost more than $330,000 in revenue a million dollars lost in 3 years. Total monthly charges for the paediatric practice Total monthly charges for vaccine codes Total number of vaccine codes Number of underpaid vaccine codes Underpayments ranging from $ $125.59

5 Identification Of The Root Cause - Underpaid Vaccine Codes Powerful but simple process automation to track report on underpaid vaccine codes was able to offer the client a retrospective revenue leakage assessment. While having the audit done manually could have added costs, automating the audit process meant that the effort to identify these underpayments was minimal. Identifying such leakages which seem miniscule at first sight is the first stage in revenue cycle transformation. s earmm framework has a dedicated segment on revenue leakage opportunities we gather intelligence from practice heads account managers then dive into the data to perform RCA s then apply fixes then monitor them through control methodologies. s robotic process automation business excellence teams were able to build a simple automated system that factored in commonly underpaid vaccine codes (weighted by $ value) provider contracts. The automation meant that an entire batch or monthly payments can be quickly audited with minimal costs. We were also able to prioritize higher revenue losses over negligible underpays. While the insurer may not accept all disputes, even at a 50% acceptance, the practice would collect an additional $ 160,000 every year. We are excited to see how this is working for us. As a matter of fact, our revenues just on the vaccine codes of 3 of our large clients brought in about $ 23,000 in additional collections within the first 3 months. The process helped us know what to expect do everything to prevent/control this commonly missed leakage! CFO, Client Organization

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