vachettepathology.com

Who's Watching Your Wallet?

Vachette Monthly, March 2020

How hospital-based pathologists should approach Anthem cutsAfter spending the better part of the past two years fighting Anthem Inc.’s pathology rate cuts in numerous states, pathologists are continuing to come together to discuss strategies for attempting to strengthen negotiating positions in hopes of restoring payment rates to a more palatable level.

However, while a number of different strategies have been employed, the results have been hit-or-miss at best, according to Ann Lambrix, Vice President of Client Services for Vachette Pathology.

After Anthem first signaled in the fall of 2018 that it intended to reduce pathology payments rates by at much as 80% in some markets, Lambrix said in subsequent months many groups opted to terminate their contracts with the intent of strengthening their negotiating leverage down the line. But, because of Anthem’s size and market saturation, that strategy hasn’t worked as effectively as it has with smaller payers.

“Anthem is coming back with better rates, but nowhere near what groups were getting paid prior to the cuts,” said Lambrix, noting that many hospital-based groups are barred from terminating their agreements with Anthem due to language in their hospital contracts.

Because Anthem represents such a large portion of most providers’ payer mix, Lambrix pointed out that simply going out of network has presented more public relations challenges for both providers and their hospitals than providers typically expect to encounter when going out of network with a payer. -- ANTHEM, 4

Recent audit findings• Remember, Medicare requires the

interpretation date of service to be listedwhen billing, not the collection DOS.This is a compliance error we'veencountered with alarming frequencyon a number of recent audits.

• CPTs 88334 and 88331 should not bebilled to Medicare when they areperformed on the same specimen.

• When is the last time your billerreviewed their front-end process? Werecently completed an audit where weidentified a case that was stuck in afront-end error for five months. Inmany instances, this would put thosecharges past timely filing deadlines!

• We recently uncovered a major codingissue after discovering a recurring errorwas causing some of our client's CPTcodes to be doubled when billed. In onecase, documentation only supported six88305s, but 12 were billed!

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At Vachette, we specialize in consulting and auditing for labs and pathology practicesWe have been working with hospitals, laboratories, and hospital-based groups for more than 17 years. Visit vachettepathology.com, call 517-486-4262, or contact Dustin Suntheimer, vice president of sales and marketing, at 734-972-2693. Our experience and expertise are second to none!

UHC will begin rolling out their electronic payments throughout 2020 to fully replace paper checks with

electronic payments.You can now check

your 2020 MIPS status at qpp.cms.gov/

participation-lookup. Even if you believe

you're exempt, now is the time to confirm before it's too late!

Common questions from our prospectsWhen speaking with first-time prospects, we often receive a handful of the same questions: Who have we worked with? What billing companies have we audited? What does our standard contract look like? To help address some of these topics, we've added a frequently asked questions section to our website that can be viewed here. If there's any topic we failed to address, don't hesitate to contact us directly!

March 31 is deadline for 2019 MIPS reportingThe March 31 deadline to complete 2019 MIPS reporting is approaching. Those who ignore reporting or fail to meet the performance threshold will face penalties of up to 7% of their Medicare revenue!

Have last minute questions about your submission? Feel free to reach out!

UHC announces limitation for non-patient lab

reimbursementsUnitedHealthcare has announced it will begin limiting reimbursements for hospitals acting as reference labs or conducting diagnostic testing on non-patients, according to a recent bulletin issued to providers.

According to the notice, for claims paid on or after May 1, 2020, “hospitals acting as a reference lab or conducting diagnostic testing for non-patients cannot bill for such non-patient diagnostic laboratory tests under that hospital’s Facility Participation Agreement. Hospitals wishing to participate in UnitedHealthcare‘s commercial network as a Reference Laboratory may apply with UnitedHealthcare to be credentialed and contracted as a Reference Laboratory.”

The notice provides the following definitions for reference labs and non-patients:

-- UHC, 3

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855-489-1207 • telcor@telcor.com©2019 TELCOR Inc. All rights reserved.

With TELCOR’s help, we were able to go in and reengineer our processes so we got paid more

quickly, got payments posted more efficiently, and just made everything much more automated than what is was previously.

~Nadra Conner, Pathology Laboratory Associates

--UHC Continued• Reference Laboratory: A laboratorythat performs diagnostic testing onspecimens it receives from otherreferring laboratories or careproviders.

• Non-patient: Is a member that isneither an inpatient nor an outpatientof a hospital, but for whom a specimenis submitted for laboratory testing to ahospital.

If you would like assistance beginning the credentialing and contract process for your hospital to become a UHC reference lab, feel free to reach out to us at 517-486-4262. In the interim, claims submitted for non-patient diagnostic laboratory tests, or claims where a hospital is acting as a Reference Laboratory, will be denied for failure to comply with this protocol in the event a hospital is billing under its Facility Participation Agreement.

Pathology Consultative Services

For over 25 years, providers have relied on Cleveland Clinic Laboratories for personalized and comprehensive pathology services.

Our expert staff provides primary diagnoses, subspecialty

consultations, and second opinion consults that form the

basis for effective patient care.

For more information, please visit clevelandcliniclabs.com.

How to preempt surprise billing law changesIt is happening. Just as predicted, we are seeing insurance plans cut contracts to hospital-based providers ahead of the passage of proposed surprise billing laws in Congress. Last fall, when we first saw a large national insurance plan cut rates 60% for no apparent reason, the question we asked was why? Our team at Vachette and Stark Medical Auditing examined the facts and quickly determined these cuts were tied to the national narrative that says patients pay too much for health care. The news cycle caught this narrative and put two or three examples of patients getting large bills for being out of network and boom: we have national hysteria about out-of-network billing. The news media didn’t bother to mention the millions of dollars of free charity care and uncompensated care providers give away every year, nor did they mention the insurance take-back schemes or retroactive payment cuts.

Here we are, insurance plans are going across the nation randomly cutting revenue to hospital-based providers, sometimes by as much as 60%. So, what can you do? Here are a few options:

• It is imperative you communicate with your administration. They must know exactly what is happening and how this will affect your income and their income. FYI: the payers know hospital-based providers are in a pinch point between the administration and the insurance plan they will use this to their advantage to lower your income. --Surprise billing, 4

Pathology & Laboratory

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Southern California AP/CP Pathology Position

A full time, partnership track position is available January 2021 for a board-certified AP/CP pathologist at a 400+ bed acute care Hospital in Southern California, and includes generous retirement plan and benefits.

The position offers opportunity for medical directorship and leadership roles with Hospital Medical Staff, and good communication skills are desirable. 1-3 years’ experience and hematopathology proficiency is preferable, however, candidates with recently completed Residency/Fellowship and strong resumes are encouraged to apply. The area offers established, safe communities with good public schools and easy access to a wide range of recreational activities. Start date can be flexible for the right candidate.

Curriculum vitae with an introductory cover letter can be sent to Michelle Matney, President of Vachette Pathology, at mmatney@vachettepathology.com.

-- Surprise billing continued• Have a clause in your hospital Medical Director contract that sets a limit noting you will accept any plan

which pays over 150% of current year CMS. (It is best to get this set to a specific year as this will makenegotiations and budgeting easier.)

• Install a clause in your contract which states the managed care plans you are obligated to sign mustprovide a cost-of-living increase equal to the national cost-of-living increase noted each year by thefederal government.

• Communicate to your clients, i.e. your patients. Remember your patients usually get their insurancethrough their employers. Track your employers and build a communication informing them thisstrategy is being executed by the insurance companies and how it will affect their employees. Mostbusinesses are seeing double digit increases in premiums every year — imagine their response if theyfind out the insurance companies are deliberately lowering their payment to qualified providers toincrease profits.

All negotiation is leverage. You must develop solid communication with your administration and startbuilding your leverage right now. This change is coming. It will happen.

Call us at Vachette Pathology and Stark Medical Auditing. We will come speak with you and your administration and lay out how this change it going to take place while working with your group to keep you

financially strong and independent.

Contact us at 517-486-4262. Ask for Mark Dietz, Vice President of Hospital-Based Consulting.

--Anthem strategy continued

For one, patients are often upset after receiving a bill from an in-network facility, sometimes resulting in angry calls to the hospital. To further complicate things, Anthem provides facility payments to patients directly when they see an out-of-network provider. While those payments are supposed to then be forwarded to the provider, educating patients on this process and actually receiving the money is a burdensome task.

“For other networks, because the payer mix is smaller, going out of network isn’t as much as an impact,” Lambrix said. “You open up the possibility to get paid more by going out of network with Anthem, but you really don’t gain much in the end. It’s a lot of time and energy spent chasing small dollars and fighting with your administration.”

And with surprise billing legislation now in effect in a number of states, to say nothing of the handful of proposals being currently discussed at the federal level, the ability to weather the PR storm and recoup lost dollars by billing patients directly as an out-of-network provider could soon be an option closed off to providers.

Lambrix said that despite the short-term financial advantages available to those who choose to go out of network to negotiate with Anthem, that strategy could backfire in the long run if Anthem attempts to narrow its network to a list of “preferred” providers, as UHC recently did. While Anthem has not explicitly said this is their strategy, providers should be cognizant of the fact that if they do leave in attempt to cultivate negotiating leverage, they may find they aren’t welcomed back by the payer later.

And those who do stay in network may eventually see a payoff from doing so, although that’s hardly a guarantee, Lambrix said.

“At that point you’d be making money on the sheer volume of tests you receive if you’ve managed to survive to becoming a preferred provider,” she said. “Even though you’d be getting maybe 60% of Medicare, you’d be getting all the business and wouldn’t have to compete for it.

In the interim, pathology providers should continue to organize at the local and state levels to push back against further potential reductions. While national advocacy groups like the College of American Pathologists and the American Society of Clinical Pathologists have had conversations with Anthem reps about this issue, there are also a number of grassroots advocacy efforts being launched in states like Ohio that would aim to protect pathology payments from additional cuts.

If you’re interested in learning more about these efforts, or if you’d like to discuss contracting strategy for your lab, feel free to reach out to us directly at 517-486-4262.

Ann Lambrix has been a leading voice on this issue and has been quoted in several industry publications exploring this topic. She and the rest of Vachette's senior leadership are available to provide strategic consultations on how to best respond to these cuts, as requested.