Improving billing practices through peer-group feedback.

Information provided by your peers may help remedy any billing and reimbursement problems you have. Data acquired by a multisite group of community-based otolaryngologists who use the same practice management software that you do can identify and benchmark billing problems.

Figure A shows the number of Medicare denials for 9 otolaryngologists during the first quarter of 2004. The four reasons for denial selected for this study were (1) the service was not medically necessary, (2) the CPT or diagnostic code was invalid, (3) the name of the referring physician was missing on a claim for a consultation service, and (4) the service is not payable separately. Figure B shows the number of claims denials for the same reasons during the fourth quarter of 2004.

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A comparison of the data in the two charts yields some important findings. For example, there was a significant overall improvement in reimbursement, as the number of denials was sharply lower during the fourth quarter. The problem of failing to provide the name of a referring physician had almost completely resolved by year's end. "Doc 2" had just joined the program at the beginning of the year; because of the length of time required to register data, his frequency of this denial reason only became apparent by the fourth quarter of the year. As the data suggest, benchmarking an individual physician's billing problems against those of the group as a whole allows outliers to be identified and can lead to improvements in reimbursement over a relatively brief period of time. If Doc 2 applies the lessons of the feedback provided by the network, he is likely to correct his problems within a few months.

A substantial overall decrease was also seen in the number of claims that had been denied because the service is not payable separately. Again, with the exception of Doc 2, the problem was almost completely resolved (as were the problems associated with the other two denial reasons). The good news for Doc 2 is that his collection problems in this regard were not a consequence of poor billing practices but were attributable to one of the specific services he provides--namely, botulinum 

toxin A injections. In his case, a Medicare hearing was scheduled to resolve the issue of coding for these injections. Had there not been a coding problem, Doc 2 would not have had any claims denied because the service is not payable separately.

Efforts to improve medical practice management must be continuous. It is helpful to objectively measure performance and change within peer groups by benchmarking research and peer input. Current technology provides an opportunity for all otolaryngologists to improve efficiency and financial performance.

Steven F. Isenberg, MD

Dr. Isenberg is an otolaryngologist in private practice in Indianapolis; [e-mail]