The financial health of anesthesia providers hinges on accurate, timely insurance reimbursement. Compared to other specialty practices, anesthesia billing is particularly intricate, demanding precision and expertise to reap maximum revenue and minimize denials.
In fact, these unique billing pitfalls can be severe enough to threaten the viability of some anesthesia practices.
Research reveals that Medicare payment rates for anesthesia are roughly 33% of average commercial payor rates. In some states, insurance reimbursement rates are even lower. Comparatively, other specialties experience an average of 80% reimbursement of commercial payor rates.
In short: anesthesia is the lowest reimbursed service in most patient care packages. This can make it difficult for anesthesia providers to maintain reliable revenue streams.
At Medical Business Management, we’ve worked closely with anesthesia providers for more than 30 years. We have dealt with complex billing issues ourselves and have found a way to speed up insurance payments.
In today’s blog post, let’s talk about some of our essential insights and strategies for streamlining your revenue and avoiding denials.
Understanding Insurance Reimbursement for Anesthesia
Specific Challenges for Anesthesia Providers
Anesthesia billing is a complicated puzzle with many different moving pieces. Insurance companies can deny claims for medical expenses for various reasons. These reasons include accurate time reporting, proper use of modifiers, and specific documentation requirements.
Most commonly, claim denials for anesthesia services cite improper coding, lack of pre-authorization, and insufficient documentation. To overcome these challenges, you need to understand the reimbursement landscape well and take a proactive approach to billing.
The Role of Accurate Coding
Before we dive deeper into strategies for optimizing your revenue, we need to touch on coding’s place in ensuring appropriate healthcare reimbursement.
Current Procedural Terminology (CPT®) codes must be used correctly to reflect certain services provided. Anesthesia-specific modifiers and time units help determine reimbursement amounts, and even small errors in these areas can lead to denials and reduced payments.
If a provider isn’t double-checking anesthesia base units, ensuring accurate cross-walking, and reporting time meticulously, they’ll likely run into coding-related denials.
Strategies to Optimize Your Revenue
Now to get to the substance of this post: discussing how hospitals, anesthesiologists, and anesthesia groups/providers can maximize their revenue while avoiding common reimbursement pitfalls.
We may use state-of-the-art software and decades of experience to help our anesthesia clients, but we’ve also identified three key components to streamlining billing:
(1) Ensuring Comprehensive Documentation
Comprehensive, consistent documentation is the golden key to billing accurately and reducing the likelihood of denials. Every anesthesia provider must thoroughly record and document all procedures, time units, and modifiers to support the necessity of the services provided. This can also help defend against potential audits.
(2) Implementing Efficient Billing Practices
Organized billing practices, such as timely claims submissions and regular follow-ups, can significantly enhance revenue. In many cases, we recommend using professional billing software that integrates with electronic health records (EHR) to streamline processes.
It’s also beneficial to implement a robust billing workflow to track claims from submission to payment and address any issues promptly. This is a big task, which is why many anesthesia groups tend to partner with a third-party billing provider that can oversee revenue cycle development, data entry, payment posting, and many other critical tasks.
(3) Regular Training and Education for Employees
Staff members play an enormous (if underestimated) role in revenue management. Continuous education for billing and coding team members can help them stay updated with the latest coding changes and best practices. Additionally, regular training sessions can prevent common errors and improve overall efficiency.
If possible, we recommend investing in professional development opportunities. Activities such as coding certification courses and workshops can keep your team knowledgeable and skilled, reducing potential mistakes and streamlining your reimbursement process.
Avoiding Common Insurance Denials
The strategies we shared above can certainly help prevent denials, but medical care providers can still do more. Perhaps most importantly, they can get to the root causes of their denials, which tend to include:
(1) Incorrect Coding
The codes used must accurately reflect the anesthesia services provided or the claim will likely be denied. We recommend regularly reviewing coding guidelines to stay updated with any changes or new codes introduced by the American Medical Association (AMA) and other regulatory bodies.
It also pays to employ experienced team members or partners who understand the nuances of anesthesia coding, including the correct use of CPT codes, modifiers, and time units.
(2) Lack of Authorization
Many insurance plans require pre-authorization for certain anesthesia services. If you want to avoid denials, you’re responsible for proactively obtaining authorization.
We help clients establish a system to verify if a patient has a health insurance plan. We also assist in obtaining approval before delivering services. This system ensures that patients are covered and services are approved before they are provided. This includes maintaining thorough records of all authorization communications, including approval numbers and the names of representatives who provided authorization.
A strategic authorization process doesn’t just streamline insurance billing; its documentation can also be invaluable if you need to appeal an insurance denial later.
(3) Insufficient Documentation
At the risk of beating a dead horse, thorough and accurate documentation is essential for supporting the medical necessity of anesthesia services and preventing denials.
To ensure you’re properly documenting each service, use standardized templates and checklists. These help ensure all the required information is captured, including details about the procedure, time units, and any complications or special circumstances.
We also encourage providers to document services in real-time or immediately after the procedure to ensure accuracy. Additionally, it’s best to regularly review documentation practices to improve completeness and clarity.
How to Approach Claim Denials
As frustrating as they may be, claim denials must be handled carefully and thoughtfully. At Medical Business Management, we have a tried-and-true protocol for managing denials, including steps for investigating the cause, appealing the denial, and implementing corrective actions.
If you don't have a billing partner, make sure staff members are assigned to handle denials and follow up on them quickly. Work on establishing a strong communication channel with insurance payers so problems get resolved quickly, rather than shuffled under the rug.
Staying Compliant with Regulatory Changes
To make matters more complicated, anesthesia billing is a bit of a moving target. Regulatory changes continually impact reimbursement protocols, and all providers must stay informed about these changes related to compliance and optimal revenue management.
Regular internal audits are the best way to ensure adherence to regulations and prepare for external audits. Keep in mind that even small errors can result in non-compliance and denials.
Leveraging Professional Services for Better Reimbursement
We won’t dance around it: specialized billing services, like those offered by our company, can significantly enhance your reimbursement protocols. Outsourcing anesthesia billing leads to improved accuracy, faster reimbursements, and reduced administrative stress.
As a result, it’s increasingly common for North American healthcare providers to hire third-party billing partners. Over the coming years, Grand View Research estimates the medical billing outsourcing market will grow at a compound annual growth rate of 11.78%, highlighting the need to alleviate the direct burden on medical practitioners.
Perhaps more importantly, outsourcing insurance reimbursement work allows anesthesiologists and other providers to focus more on what truly matters: providing exemplary care to patients.
Ready to Outsource the Anesthesia Reimbursement Process?
Optimizing revenue and avoiding denials requires a multifaceted approach, including accurate coding, comprehensive documentation, and highly efficient billing practices.
At Medical Business Management, we handle these tasks and more, turning anesthesia services into more reliable, steady revenue. When you partner with us, we implement the strategies outlined in this post and other custom approaches to protect your practice’s financial health.
To learn more about navigating health insurance reimbursements, get in touch. We’ve worked with countless anesthesia clients, and we’re confident we can optimize your revenue cycle.
