Practice Management

We have an agreement with the hospital that if a patient they have seen results in a no auth denial, we bill the hospital directly and they pay us a flat fee.  We can't be held liable for a front end issue that we had no control over. Maybe this is an option for you? Best of luck,

Mindy Smith

Billing Manager

Management Data Systems

3114 Lake St

Lake Charles, LA 70601

337-437-7681

866-437-7681

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Amerihealth Caritas (Delaware Medicaid)

Highmark Health Options (Delaware Medicaid)

Highmark Blue Shield

Hi Rick,

We have the same issue with a variety of payers.

Most of the time, an appeal explaining the situation will work.  If not, we track the adjustment and use it as a negotiation tool with the hospital.

It takes a lot of manual staff effort and I agree, it would be ideal if they could create some way for us to report it on the claim initially (like a new place of service code).

Feel free to call if you'd like to discuss further.

Kindly,

I think the reason it doesn't affect the hospital is because they bill the "Admit Type" on their UB04 form.  So they are telling the payer the patient originated in the ER and eventually ended up in OP/OBS.

Our CMS1500 forms don't have that option.

This is directly from the Medicare Benefit Policy Manual, chapter 6....

B. Coverage of Outpatient Observation Services

When a physician orders that a patient receive observation care, the patient's status is that of an outpatient. The purpose of observation is to determine the need for further treatment or for inpatient admission. Thus, a patient receiving observation services may improve and be released, or be admitted as an inpatient.

In other cases I am aware of, it absolutely affected the hospitals.  However, because of the way they bill/post claims/payments, they were unaware (aggregated with other claims and not line item posted).  We raised this issue with the hospital associated with one of our billing clients and they were surprised to learn they too were being denied.  They had to dig a little bit to uncover it. 

They are now making attempts to get these studies preauthorized.  Not easy since they are on a floor and treated like other inpatients from a natural workflow perspective. 

What we discovered is that many (but not all) of these tests were ordered by the ER physician when thee patient was in the ER, then they were sent to the room.