HME News

JUL 2018

HME News is the monthly business newspaper for home medical equipment providers. This controlled circulation publication reaches 17,100 home medical equipment services providers, including traditional HME dealers & suppliers, hospital- and pharmacy-o

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hme news / july 2018 / 9 c ommentary Enter the new age of interoperability Three keys to negotiating successful payer contracts By Nick kN owlto N O ver the last decade, there has been a huge invest- ment into health information technology. It's no sur- prise then that the landscape of h I t has evolved tremendously. In today's world of h I t , interoperability is the word at the forefront of every practitioner's mind. Interoperability is the extent to which systems can seam- lessly exchange data and interpret and act on that shared data, and it is progressing by leaps and bounds across the care continuum. Despite all of the forward momentum, certain sectors of the healthcare industry have been left behind when it comes to interoperability and desperately need to catch up to survive—most of all, those in the post-acute space and home medical equipment providers in particular. While h M e providers are certainly playing a game of catch up in the world of h I t , the window to connect to their care ecosystems and improve both patient and busi- ness outcomes is open today. As reimbursement challenges continue and the healthcare industry evolves into a system of value, quality-based reimbursement and network care, consider these main reasons why achieving interoperability will support h M e providers' survival in modern healthcare s treamlined operations One significant function of interoperability is allowing h M e providers to interact in an efficient, timely manner, with both referral sources and patients, using accurate data and records. t he automatic flow of data provided by interoperable technology saves time and money, while enhancing operational efficiencies and patient interac- tions. Immediate access to patient data serves as a power- ful tool when recording, tracking and trending data, such as patient vitals and statistics. t his access to data improves the care experience for the patient and their quality of care, and enhances how clini- cians interact with them. By removing manual processes from the equation, providers are able to have confidence in their operations and focus on other value-added tasks, ultimately producing better patient outcomes. i mproved reimbursements Interoperability helps h M e providers across the health- care continuum maintain increased, consistent visibility into a patient's records, treatments and outcomes. t his increased visibility helps to facilitate better patient care, as well as more complete and accurate documentation from the start of a referral. With more clinical and order information, and thorough documentation being submitted to payers, there is potential for vast improve- ment in multiple aspects of reimbursement. s trengthened and increased referral relationships t raditionally, referral relation- ship strategies have been highly labor-intensive, requiring staff to make countless phone calls or in-person visits. t hrough electronic collaboration with interoperable technologies, providers are much more attune with their referral sources. Physicians are able and expected to communicate electronically and bi-directional- ly, and now, h M e providers will be able to participate, too. t hese modern connections streamline the referral process for both the referral source and provider, which reduces errors and rework, decreases order entry times, and most importantly, strengthens referral relationships. t hrough interoperability, providers can now be viewed as an inte- gral part of care delivery rather than commodities. t he percentage of electronic referrals to h M e provideres may be small today, but it is expected to rise significantly over the next few years—and that presents an opportunity for h M e providers who quickly embrace interoperability to gain additional market share. b etter facilitation of patient care Provider organizations certainly share similar goals and quality standards with the rest of the healthcare ecosystem, but how they communicate (or don't communicate) key information can be very different. With interoperability, that paradigm is changing, because connected organizations are the future. h aving the ability to communicate with other healthcare providers that have or will care for the same patient creates a seamless line of communication that helps ensure all parties are fully up to speed on the patient's overall care plan, facili- tating a better experience for the patient and the provider. s tay relevant r eferral sources will eventually have a choice to make: Do they send referrals to the provider who uses outdated technology or send them to the provider that is able to bi-directionally share accurate, up-to-date information? It won't be a hard choice for them to make. Interoperability is key for h M e success, and all of the reasons for such success culminate in this: Providers have to innovate to stay relevant in this market, or they run the risk of being left out. Adopting new interoperable technolo- gies will, ultimately, help your business stand out from its "unplugged" counterparts. Interoperable technologies are impacting the future of health care in a big and powerful way, and refusing to embrace such technology is simply not an option. h M e providers must have a clear understanding of how they fit into the dynamic healthcare ecosystem, and that includes using a strong technology platform to succeed in this new interconnected world. t he h M e providers who act now will be well-suited to compete and better serve patients and referral sources, reaping the rewards that early adopt- ers tend to enjoy. t he truth is this—providers continu- ing without interoperable technologies will surely be left behind. hme Nick Knowlton is the vice president of strategic initiatives for Brightree, where he leads the company's approach to healthcare interoperability. Knowlton also co-founded CommonWell Health Alliance and serves in a leadership role. He can be reached at By Steve Sel BS t T he P ur PO se of this article is to help you, as a pro- vider, to hone in on three key items to look for in payer contracts that will help you to get profitable contracts in place. t he three key areas that we will exam- ine are fee schedule amendments, lesser of billed charges vs. contracted rates; term and termination without cause; and claims' payments. fee schedule Fee schedules sometimes are rvu based or based upon a percentage of Medicare or based on a percentage of a payer's proprietary fee schedule. Fee schedules may also be based on a percentage of your charges, some- times with upper limits. In these scenarios, it is best to ask the payer to provide you with the exact fees by code / service to be sure that you know exactly what to expect to be paid. It is very easy to miscalculate based on the way that codes are grouped, or the proprietary formulas used. A related clause that is almost universally found in payer agreements is the "lesser of billed charges vs. con- tracted rates language." t his means that you will get paid your billed charge instead of the contracted rate if your billed charge is less than the payer's contracted rate. For example, if code 99213, an office visit code, has a contracted rate of $100 and your billed charges for this code is $80, you will get paid $80 not $100. t he effect of this discrepancy is that you have negated the higher contracted rate by setting your charge master too low. r ule of thumb: s et your billed charges for every code well above contracted rates, usually this means calibrated at 250%-300% of local Medicare rates. term and termination Next is termination without cause. t he most common termination clauses are 90 days without cause, 90 days prior to the anniversary date and similar clauses for 120 days. What you are looking to do is to maximize your flexibility to either renegotiate rates period- ically or to have the option to terminate an agreement. When the condition for termination without cause is 90 days' notice only, then you may give 90 days' notice at any time during the contract period and then the contract will terminate if you give this notice 90 days hence. For example, if you give notice to terminate on Oct. 1, then your termination would be effective on Dec. 30. Many payer contracts have a related stipulation that the initial contract term must happen first before you issue the termination request. For example, you may be on a minimum three-year agreement from the date of signature. t he three-year term may have to take place first and the contract may specify that the soonest you may terminate is on the third anniversary of the agreement, which means that the soonest, in this situation, that you could give notice would be roughly two years and nine months from the date of signature of the agreement. Other agree- ments are "evergreen." Like an evergreen tree, they keep renewing as of a certain date, usually annually, unless either party issues a termination request. t he best time to negotiate rate increases is about three to four months prior to the termination notification date (not the actual termination date). t his gives you and the payer time to adjust the terms of the revised agreement. claims payments t he third item is claims' payments, both how long you have as a provider to file and how long the payer must pay claims from the date that they receive the claims. Ninety days to file after the date of service is desirable. If necessary, you may request up to 180 days. t he key is that you make sure that the claims filing requirements meet your business/operational practice for filing claims. If you routinely file within 10 to 20 days of performing a service, you will be well ahead of the 90-day require- ment. t he norm is for payers to pay claims within 30 to 45 days of receiving a "clean claim." hme Steve Selbst is CEO and co-owner of Healthcents Inc. Steve may be reached at 831-455-2174 or Despite all of the forward momentum, certain sectors of the healthcare industry have been left behind when it comes to interoperability and desperately need to catch up to survive—most of all, those in the post-acute space and HME providers s T eve selbs T nick kn O wl TO n

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