How well does tort reform work?

In Ohio, it works very well indeed
The spring of 2002 was not a happy one for many of Ohio’s physicians. Professional liability insurance rates had skyrocketed, making coverage unaffordable and sometimes unobtainable, especially for those in high-risk specialties like obstetrics, neurosurgery, and orthopaedics. Many physicians were considering retiring early, moving, or eliminating high-risk procedures. The American Medical Association had placed Ohio on a list of states considered “in crisis.”
As a result, the Ohio State Medical Association (OSMA) took action at the state government level to reform Ohio’s tort system, so that physicians could stay in practice and continue caring for Ohioans. From 2002 to 2004, OSMA and its members helped enact 20 sweeping medical liability reforms that provided relief from the liability crisis.
A “supreme” effort
Like many states, Ohio had seen the state legislature pass tort reform measures, only to have the laws overturned by the state supreme court.
To help ensure that these reforms “stuck,” OSMA, Ohio physicians, and other interested parties undertook the task of changing the philosophical make-up of the Ohio Supreme Court. This was accomplished by supporting candidates who held a “judicial restraint” philosophy. Prior to 2002, the Ohio Supreme Court was considered an “activist” court, one that “legislated from the bench.” At that time, four of the seven justices fit that label.
Today, 6 years and three election cycles later, the Court is considered to have a 6-to-1 “judicial restraint” majority, one that defers public policy matters to the legislative branch. With this new philosophical majority and a new law that addressed prior Court decision reasoning, tort reform measures have a much better chance of being upheld if challenged.
The benefits of reform
As a result of the tort reform efforts, the total number of medical liability suits has declined, insurance rates have stabilized, and the liability insurance market is more robust.
In 2005, the first year that the Ohio Department of Insurance collected data on medical liability claims, 5,051 medical liability claims were closed. Of these, 21 percent (1,046) resulted in a payment to the claimant. One year later, 4,004 claims were closed and only 794 resulted in a payment to the claimant.
In other words, there was a 20 percent reduction in overall claims from 2005 to 2006 and a 24 percent reduction in claims resulting in a payment.
Additionally, the 2005 data revealed that claims subject to the new tort reform law had indemnity payments nearly $100,000 less than claims not subject to the new law.
Starting in 2001, medical liability insurance premiums began to increase significantly—22 percent in 2001, 30 percent in both 2002 and 2003, and 20 percent in 2004. Once the tort reform proposals had time to work, rate increases began to moderate; rates increased just 6.7 percent in 2005 and actually declined by 1.7 percent in 2006 and by 10.9 percent in 2007. The 2007 rate reduction translates to an average savings of at least $1,000 per Ohio physician.
In 2000, Ohio had nearly 30 medical liability carriers who provided professional liability insurance for physicians. At the height of the liability crisis in 2003, the state had only five carriers, three of which were showing increasing financial difficulty. Today, however, Ohio has 15 companies competing for business in a more robust and predictable medical liability marketplace.
Holding trial lawyers accountable
In addition to its efforts for tort reform, OSMA also created a Frivolous Lawsuit Committee to fight back against trial attorneys who file frivolous claims. The committee, made up of physicians and lawyers, reviews possible cases of alleged frivolous conduct by a plaintiff’s lawyer. Then, if warranted, the committee will assist defense counsel with seeking sanctions against that lawyer for filing the frivolous claim.
In three separate cases, the court sanctioned trial attorneys and the physician defendants were awarded recovery of defense costs totaling more than $35,000. Most importantly, these cases have provided a legal precedent in Ohio for holding trial attorneys legally and financially responsible if they file a frivolous lawsuit.
A positive outcome
The medical liability changes that have occurred in Ohio since 2004 have had positive effects: the medical liability insurance market has stabilized, insurance rates have declined, court case filings are down and physicians no longer have to worry that a liability insurance crisis will drive them out of practice.
In response to the critics of tort reform, we can say that all of the changes still permit those with legitimate liability claims to have access to the courts and access to reasonable and fair compensation.
Does tort reform work? One only needs to look to the Ohio experience as proof that it works very well indeed.
Tim Maglione, Esq., is senior director of government relations for the Ohio State Medical Association.
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Increasing Revenues, Minimizing Overhead Costs and Improving Patient Data Collection Accuracy

Medical practices seeking greater operating efficiency and improving bottom lines are implementing more stringent registration, billing and data collection policies. Practices failing to implement and take charge are likely to lose literally hundreds of thousands of dollars annually.

Some common and frequent problems directly related and often overlooked or ignored start at registration. Patient registration is the key to ensuring near perfect practice efficiency. Patient registration forms must ask and include ALL pertinent demographic information and must be carefully reviewed for accuracy and completeness by front desk personnel prior to patients seeing doctors.

Medical practices seeing new patients should schedule appointments 48 hours in advance allowing sufficient time for staff to validate insurance eligibility, obtaining authorizations, granting or obtaining referrals and patient demographics. When questions arise or incomplete information is discovered, practice staffs need to immediately contact patient and/or guarantor to make necessary corrections.

One important step to further streamlining the practice and these critical areas is informing both new and returning patients which credit cards are accepted, co-pay amounts, credit policies for patients with deductibles and those without insurance.

In conclusion, although these `efficiency’ components sound reasonable and logical, many practices do adhere to such policies however, many do not resulting in significant amounts of unearned revenues.

The professional medical billing team at URS Billing Services is keenly aware of the financial benefits these policies generate and highly recommends they become integral to all medical practices.

A Few Key Strategies for Optimizing Revenues and Increasing Operating Margins

Many medical practices are struggling to making ends meet and maintaining minimal cash flows.
The one key culprit is lower reimbursement rates, especially in family, general and internal medicine
practices. Many practice administrators are throwing up their hands in complete frustration.
Fortunately, there are several key areas of office administration and operation that can present
opportunities for increasing revenues and improving operating margins.

Accuracy – Accuracy produces efficiency, `maximization’, talent and cash flow. Accuracy should
be emphasized and encouraged at every possible opportunity. Employees should gain a sound
understanding of the fiscal meaning of `accuracy’. For example, the URS management team emphasizes
the importance of accuracy when reviewing charges, coding, entering demographics, posting payments
and responding to patient inquiries. Understanding this key aspect of production is absolutely essential
in those practices experiencing lower revenues and operating margins.

Let’s take a moment to evaluate the negative financial impact of a billing staff which continually makes
charge and demographic entry mistakes. If it takes one member of the billing staff to accurately conduct
the daily processes of entering charges, demographics, posting payments, insurance follow-up and
responding to patient inquiries, one can attribute reasonably accurate production costs to perform
these tasks.

Now let’s look at another staff member who conducts the identical tasks but it takes an additional 3
hours of the following day to complete them because mistakes have been made and additional time is
needed in the next day to finish. Obviously one can see the added costs to the practice which directly
impacts the practice’s bottom line.

Establish Benchmarks – One way to encourage and better manage efficiency within the practice is by
establishing `production benchmarks’. Benchmarking efficient production modeling facilitates personal
and team challenges and competitiveness within the medical practice. It is a management concept
which benefits management because it assigns both personal and team responsibilities resulting, in
many cases, less time for management oversight.

One key and very important aspect to `benchmarking’ production is rewarding achievers; whether
a team or individually, financial rewards tend to encourage and motivate certain staff members to
wanting additional responsibilities and desiring potential management positions.

The biggest and most obvious financial benefits of benchmarking are accelerating cash collections,
improved practice efficiencies and operating margins. The URS management team has been utilizing
these production benchmarking management concepts since 1998 and our billing services have greatly
benefitted each client; many for more than 5 years.


5 Tips for Successful Debt Collection

Here are some tips to implementing a successful collection of delinquent accounts. As part of our ongoing and presence in collections, we ask for your input. Please respond to the article if you have other tips and suggestions from your successes or if you questions. Please click on the below link.

1. Correct/Updated Demographics—It is veryimportant to ensure that ALL debtor(s)demographics are correct and current –complete full name, telephone number(s), home address(s), amount(s) owed, balance,age of account(s) and type of account(s). These data can be verified from theinstitution’s database, financial transactions, credit bureaus and various skip tracing websites. It is key to make sure debtor addresses are correct to ensure debtor is receiving all appropriate delinquent notices and information about the debt.

2. Sending Notice(s)—Notices should contain all pertinent information regarding the debt including balance due, amount past due, date and amount of last payment and importance of the debtor(s) contacting the banking institution. Notices should be mailed at specific intervals for maximum effect. For example, the firstnotice of delinquency is mailed 14 days past the contracted due date. Thesecond notice is mailed 21 days of due date and if no contact by the debtor hasbeen received explaining why payment is late or agreeing to payment arrangements, the account should be assigned to the collection for the `pre-30’collection approach.

3. Professionalism— one important key to achieving effective collection rates is maintaining professionalism. Professionalism, in concert with firmness and understanding, is absolutely necessary to achieving maximum results. Collectors should offer various payment options and taking into consideration debtor’s current financial situation and within the bank’s collection policy guidelines. Collections is an art and learning and understanding its purpose will add positive tones and results. Debtors will give many reasons for not making payments, but collectors must be patient and carefully listen to what is being said by the debtor. If debtors are expressing severe medical issues, a death in the family or other viable financial problems, collectors need to understand these dilemmas and offer other options in concert with the bank’s collection policies.
4. Working with Debtors—Debtors might not have the money to make a full payment, therefore it is important to work with the debtor(s) and offer alternative payment options which, of course, follow corporate collection policies. Some banking institutions have within its policies the option to settle accounts up to 15% of the total balance if paid within specific time periods. However, the ideal solution is working with delinquent customers and having them return to a satisfactory standing within the bank.

5. Accessibility to the Bank—Delinquent customers should be given several options for making payments or having accessibility to certain branches for making payments. When collectors send out notices or make follow up phone calls, collectors have to make it clear where or how debtors can make payments.


Goal Setting – Achievements

Goal setting in many of today’s practices is considered a waste of time or there is not sufficient time to be concerned with fantasy. Effective and practical goal setting is an important management tool to delivering quality medical care and achieving greater financial success for the practice. Over the past nearly 12 years of providing quality medical billing services to variety of medical disciplines including prosthetics and orthotics, few practices had in place specific goals financial or marketing goals. However, following several months of providing `Key Financial Reporting Data’ to practices they, the partners, began to see, understand and evaluate the reported data.

Two especially important pieces of information are the number of patients treated and revenues produced per patient visit and aging schedules. Practices began to realize the importance of analyzing the impact of treating patients and making sure once patients are treated, it is very important to making sure all notes and codes are complete, accurate and ready for filing by the end of day or within 24 hours of treating patients. Alert - Generating the practice’s aging schedule and discovering that more than 50% of the month’s $150,000 charges fall into the 30-60 day aging category should sound very loud alarms. Goal – Charges are ready for filing within 24 hours following treatment.

Today, physicians are treating a greater number of patients which has not been a particularly sought after objective. However, because declining reimbursement rates are negatively impacting many medical practices this unfortunate fact has resulted in doctors seeing more patients in an effort to maintaining revenue levels just to pay current operating costs. Goal – increase number of patients treated daily for each physician by 5.

Setting goals and objectives do matter and need to be part of the overall of the practice’s game plan. The managing partner needs to schedule monthly meetings with all members of the staff and make it a team effort. Engage the billing service. Explore and evaluate optional ancillary services. Establish goals, objectives, assign specific office staff for each of the practice’s goals, measure, assess and reward.

5. Denials management

"Efficient billing and collections processes are critical components of a successful and profitable medical practice. Yet most practices leave between 5 percent and 30 percent of their reimbursement on the table because they lack proper processes, staffing, training or technology. Industry experts say the first 80 percent of payments are relatively easy to collect. It's the next 20 percent that are harder to obtain and more expensive to collect. Follow these recommendations and regain control of your billing operations..."

Understanding the issues surrounding a denial is critical to rectifying the situation and obtaining payment. Denials management is often a neglected area due to the labor involved and intrinsic knowledge needed. A dedicated team should be assigned to posting and follow-up for denials. Trends in payer reimbursement can be identified and addressed. Try to target problem areas that affect the bottom line to obtain maximum reimbursement for all services provided. Managing the process can be time-consuming and difficult, but it is essential to optimizing cash collections.


5 Tips to Improve your Medical Practice's Billing & Collections

"Efficient billing and collections processes are critical components of a successful and profitable medical practice. Yet most practices leave between 5 percent and 30 percent of their reimbursement on the table because they lack proper processes, staffing, training or technology. Industry experts say the first 80 percent of payments are relatively easy to collect. It's the next 20 percent that are harder to obtain and more expensive to collect. Follow these recommendations and regain control of your billing operations..."

4. Remittance management and payment posting
Retrieval and processing of claims should be done with electronic remittances from government and large commercial payers whenever possible. Automating this process reduces human error and highlights claims that need additional follow-up. The combination of electronic remittance advice and electronic funds transfer puts money into your account quicker and allows timely billing of secondary claims.
Catching up? Here are the previous discussions:

Verification of benefits and patient registration
2. Medical Coding

3. Charge Validation

Marketing Your Practice

When was the last time the owners of the office collaborated and seriously put forth a marketing plan designed to attract more patients to the practice? In many practices, physicians are very busy seeing and treating their patients and getting paid.  Practices which employ administrators to help manage personnel and financial matters are, too, inundated reading and deciphering 5010 coding and recent complicated Federal and state legislation issues.

Decreasing revenues, patients, fluctuating cash flows and profitability are wide spread and on the minds of most managing partners.  Practices need to realize that new and revitalized business and marketing approaches are needed in order to survive in today’s competitive medical practices.  Recent patient surveys indicate patient loyalty and respect have declined causing some practices to release staff members, including physicians.

Designing medical practice marketing plans requires time, energy, purpose and expertise.  Practices should first review reasons why patient volume is declining and why patients remain faithful to the practice.  Reasons for either case might include the practice’s referral base or patients who refer neighbors and co-workers or a physician’s lackluster bedside manner.  Other reasons could result from fewer insurance participations or a highly transient geographical area.  But no matter the reason(s), patient surveys should be an integral part of everyday business along with statistical tracking all variables and they should be carefully monitored for appropriate actions.

The first step is making sure the practice’s insurance participation status is listed as a participating provider.  Solo practices are particularly vulnerable, as some managed care plans will only contract with group practices.

Suggestions for Developing a Marketing Plan for Your Practice

Communicating with Patients 
-        Patients are emotionally driven – Define the message
-        Understanding the importance of the practice – What is unique, accomplishments about the practice or physicians
-        Establish Target to a specific destination – Where do you see the practice – the target and market positions of practice
-        Develop Marketing Plan (Goals, Objectives, Target(s), Expertise, Budget, etc.)
-        Achieve High Levels of Efficiency – Patients seek high quality of care with fewest mistakes and waiting times – improve cash flow and profitability
-        Utilize / Promote use of Website / Accessibility – patient data resources – scheduling

Remember – Marketing is either an investment or an expense.  What determines either is the level of commitment of following a structured marketing plan. Make sure marketing plans are set and designed to attracting patients not providers while remaining actively involved in hospital activities.

5 Tips to Improve your Medical Practice's Billing & Collections

3. Charge validation

Prior to submission, claims should be scrubbed by an industry-specific tool that uses standard and custom edits. The system should automatically detect coding combinations related to un-bundling, modifier appropriateness and mutually exclusive procedures. Medical necessity concerns can be discovered and proper channels exercised to improve or amend documentation.

What are your thoughts on how this process should be completed? 

5 Tips to Improve your Medical Practice's Billing and Collections

"Efficient billing and collections processes are critical components of a successful and profitable medical practice. Yet most practices leave between 5 percent and 30 percent of their reimbursement on the table because they lack proper processes, staffing, training or technology. Industry experts say the first 80 percent of payments are relatively easy to collect. It's the next 20 percent that are harder to obtain and more expensive to collect. Follow these recommendations and regain control of your billing operations..."

2. Medical coding
Certified professional coders should handle coding to ensure that it's proper, the first time. Missed or improper codes can equate to thousands of un-billed dollars and expose you to potential liability and compliance issues. Auditing consultants or firms hired annually can help ensure accurate and complete claims and coding functions.

To view the the first question about verification of benefits and patient registration, click here

Now, explain how you make this a priority or reasons you are having difficulty completing this task!

5 Tips to Improve your Medical Practice's Billing and Collections

"Efficient billing and collections processes are critical components of a successful and profitable medical practice. Yet most practices leave between 5 percent and 30 percent of their reimbursement on the table because they lack proper processes, staffing, training or technology. Industry experts say the first 80 percent of payments are relatively easy to collect. It's the next 20 percent that are harder to obtain and more expensive to collect. Follow these recommendations and regain control of your billing operations..."

1. Verification of benefits and patient registration
It is increasingly important to verify a patient's benefits prior to the date of service. It can decrease the cost of collections, minimize the risk of writing off a balance and significantly improve your cash flow. This is also an opportunity to address outstanding balances and co-pays.

Now, explain how you make this a priority or reasons you are having difficulty completing this task!

Motivating Debtors to Pay - The Effective Collection Tools

The overall goal or game plan for all commercial institutions is maximizing revenues with the fewest telephone calls and collection letters. Developing and implementing effective collection techniques requires skillful communications skills.

Collecting delinquent accounts is an art but, in many cases, a necessary evil for achieving revenue goals. In my 35 plus years of collecting and managing large collection staffs, I have found greater successes result from techniques which emphasize positive attitudes and motivational approaches with debtors. Contact with debtors should include phrases such as, “Mr. Debtor,my name is John Doe, I ‘m with the 3rd National Bank and calling because your account is past due and the bank wants to know you are able to make it current”? Typically responses fall into one or more of the following categories: “I’m currently unemployed and looking for work”, “my hours have been reduced”, “my husband is temporarily laid off or “my wife is unable to work for the next several months”. The positive approach is showing concern for the debtor’s unfortunate circumstances and responding by saying, “Mr. Smith, you’ve had a very good record with the 3rd National Bank over the past several years and would certainly want to help you return to that status. So let’s work on a plan that is acceptable to the bank and you”.

Greater successes have resulted with this or similar approaches than with more aggressive and unsympathetic tones. Of course, there are going to be many situations under which this approach might not be feasible with the bank’s operational policies, specifically when it involves secured loans. For example, in the case of automobile loans, the bank’s policy might state that secured auto loans cannot be more than 2 contractual payments past and must be brought current within 2 weeks or repossession shall be considered. Always keep in mind communications with debtors should be positive and carry motivational tones, regardless of whether collecting secured or unsecured loans. This approach has always achieved much success for many, many years and, more importantly, banks do not want to repossess any type of vehicles or litigate for deficiency balances.

May the Banking Industry See Greater Prosperity in 2012

Banks are hoping for much greater economic activity and growth in 2012. But, based upon the latest economic statistics, we are looking at a sluggish 2.0%. Many economists are speculating that a slow movingeconomy will be attributed to new and lingering banking regulations. For example, larger banks will be required to limit their financial ties to one another under new proposed rules aimed at preventing the collapse of one big institution from triggering a larger, cascading crisis.

The net credit exposures between any two of the nation's six largest financial firms, including J.P. Morgan Chase & Co. and Goldman Sachs Group Inc., would be limited to 10% of a company's regulatory capital, under a proposed package of regulations released by the Federal Reserve on Tuesday. Most other firms covered by the rule would be subject to a 25% limit, as required by the Dodd-Frank financial-overhaul law.

The new 10% limit for the biggest firms was unanticipated by the banking industry and has the potential to scale back the capital-markets businesses of large institutions, analysts have said.

Credit restrictions are just one piece of a tougher set of regulations the Fed has drafted which apply to the nation's largest, most complex financial firms. These stricter rules are aimed to reduce the ability of any single financial giant to damage the financial system and the broader economy, and is one of several ways Dodd-Frank attempts to end the "too big to fail" phenomenon that led to huge taxpayer-funded bailouts.

It is quite apparent that the more the federal government imposes its iron hand of federal regulations upon banks and related credit companies, increased inefficiencies will negatively impact bottom-lines. This result ultimately decreases investor incentives and could also negatively impact respective stock values; hence 401k and other retirement financial vehicles.

Well, folks these trying times have resulted from a class of economic illiterates who not occupy most government agencies but elected officials who are primarily concerned about their own well-being and re-elections.

Good Luck and call us to help your financial institution see more black than red!