July 12, 2022

Medical Billing: Maximizing the Power of Claims Scrubbers

By Thomas Reinke, Consultant, Advisory Services

Medical Billing: Maximizing the Power of Claims Scrubbers Clinical Services

Revenue cycle management is an ever-changing headache for medical practices. The challenges associated with it fall into five broad categories:

  • Capturing and submitting complete information on services provided to patients.
  • Ensuring a state-of-the-art billing system with features that maximize revenue.
  • Effective and efficient billing policies and procedures.
  • Managing staff.
  • Keeping pace with payers and their reimbursement requirements.

Each category brings unique challenges. To further complicate things, problems or changes in one category often have a ripple effect and produce problems in another category.

Marcum is seeing situations in primary care networks operated by health systems: When the services a practice provides are constantly changing, it undermines the power of a critically important billing module and has a direct impact on maximizing revenue.

The compromised billing module is often referred to as the “claims scrubber.” It is the software that checks charge information for accuracy of procedure codes, diagnosis codes, insurance coverage, and other essential claims data.

One reason claims scrubbers aren’t working optimally in primary care networks is that services are expanding and being delivered in new ways. Traditional primary care office visits now include new screenings, health risk assessments, and testing/evaluation services. These services require formal assessment tools and outcome reports. In many cases they are delivered separately by a nurse, and payment requires a diagnosis code that explains the clinical reason for the assessment. If the appropriate diagnosis code is missing, or an inappropriate diagnosis code is inadvertently used, the service may not be paid.

A closely related example involves annual preventive exams. Many patients who are seen for an annual visit also have active medical conditions. That means physicians can be paid for a separate medical visit, in addition to the annual exam, if they submit a separate appropriate diagnosis for the medical visit.

These examples illustrate several problems. First, we are seeing many instances where these reimbursable services are not properly set up and detected by the claims scrubber or billing module. Coding is also not properly reported or coordinated in a way that accurately links diagnosis codes, procedure modifier codes, and the visit or screening codes. Finally, coverage for these combinations of services varies by payer and rules need to be set up in scrubbers based on specific payers’ coverage policies.

Substantial additional revenue can be gained by preventing the errors in these examples. For instance, the additional revenue generated by properly billing an add-on medical visit, using CPT code 99212, is $57.45, based on the benchmark 2022 national Medicare physician fee schedule.

While this discussion focuses on primary care networks, there are similar examples in many physician specialties, as well as for physician extenders — especially nurse practitioners.

One reason claims scrubbers are out of touch with a practice’s services is the geographic separation between practice sites and the central billing office (CBO) in primary care networks. Claims scrubber modules are often maintained by the CBO, and a lack of direct contact between practices and a CBO can naturally prevent the communication, updates, and reporting necessary to stay on top of things.

There are several ways to improve performance. It’s best to start at the source, with practice managers implementing procedures to ensure staff are trained to code all services accurately. Another option is to hold a targeted manual coding review process in the CBO. If this is not feasible, an alternative is closer monitoring of payer remittance advices and rejection messages. Improper billing of an add-on service will show up as an insurance rejection. CBO staff and practice managers should monitor insurance rejections. They should look for patterns of rejections from payers, and practice managers should review rejections to identify erroneous charge capture and diagnosis coding activities, as well as systematic errors by specific carriers.

Marcum provides innovative billing and practice management services to physician organizations. During our long history of working with medical practices, we have devised unique approaches to improving quality, financial performance, and efficiency.