Studying COVID denials and payments can help you recognize operational inefficiencies that are hurting revenue.
Fair and timely COVID testing reimbursement is essential to labs, especially after investments to expand testing capabilities and the high cost of testing supplies. According to a recent survey, the average charge for a COVID test (CPT code 87635) performed by an independent lab was $140.41, while outpatient settings reported an average cost of $167.87 per test. Starting on January 1, 2021, CMS began to reimburse $75 per test with a $25 bonus for two-day turn-around times. (Get more details about COVID testing payments and regulations.)
The new reimbursement scheme for COVID testing is good news for the bottom line, but some labs are facing the same old challenges getting paid. As the virus continues to spread, testing volumes are expected to rise as well. If a lab's revenue cycle is struggling now, it will only worsen as claim volumes increase. Fortunately, an examination of your common COVID claim challenges will reveal where intervention can improve revenue cycle operations. Lessons learned can save labor, raise collections, and accelerate revenue.
What COVID claim challenges may be telling you
Denials and slow payments are frustrating under the best of circumstances. Running into reimbursement roadblocks during a pandemic can put your business at risk. Here are some common COVID claim challenges with advice on next steps to help you get paid.
A large number of eligibility denials – There is a breakdown in obtaining correct patient demographic or insurance information. For walk-in labs, the responsibility for accurate information lies with the front desk. Confirm patient information is confirmed at every lab visit, even for frequent patients.
A large number of coding denials for one payer – Confirm correct diagnoses, procedure, and add-on codes are used for COVID testing. Consider that some payers may prefer to use HCPCs. Contact the payer directly to find out which codes they prefer.
Patients receiving checks from insurance – A payment made to the patient (rather than the lab) is usually due to the provider’s out-of-network status, or there has been no assignment of benefits indicated on the claim.
If the checks are due to out-of-network status, consider becoming an in-network provider. If providers are located close to state boundaries, sometimes payers will allow an out-of-state provider to join a network if the provider is submitting enough claims.
The assignment of benefits scenario may be easier to solve. Confirm assignment of benefits language is included in patient intake forms, and patients are granting permission to bill on their behalf during registration. After patient consent is confirmed, be sure that assignment of benefits is indicated on the claim before submission.
Slow payments – Many electronic claims are paid in two weeks or less. If an investigation reveals payments are not posting promptly, operational inefficiencies may need to be addressed. Areas to investigate:
Claim submissions: Confirm that claims are coded promptly and accurately, and are moving through the clearinghouse to payers.
IT infrastructure: Many systems automatically 'sweep' for information at designated times during the day. Late payments may indicate problems with information feeds from a department or location.
Payment posting: Delays in processing payments will add to days in accounts receivable. Electronic payments are faster to post than paper checks. Consider enrolling in electronic payments for payers that are sending paper.
Overcome COVID testing claim challenges
Some lab billing departments can overcome COVID testing claim challenges. However, there are many places inefficiency may be hiding, and labs can find it labor-intensive (or simply don’t have the staff) to identify and correct revenue cycle issues. Additionally, rules and regulations for COVID testing are evolving, and keeping up with the latest changes to ensure reimbursement can become overwhelming. The right revenue cycle management partner can help you focus on clinical operations and create an efficient revenue cycle that increases collections and accelerates COVID testing payments. Get started today and see how Quadax can ensure optimized billing productivity and profitability for your organization.
Let’s take on the revenue cycle together!