Billing mistakes have more serious implications than you just seeing a decrease in your reimbursement.  Some of the most common billing errors can get your practice audited, and result in you paying massive violation penalties.

Unfortunately, accurately billing for outpatient services is so much more complicated than just submitting a claim or sending an invoice. Seemingly innocuous billing practices — like waiving a patient copay — can land you in a significant legal and financial nightmare.  And the “I didn’t know” excuse really doesn’t fly.

Most providers with noncompliant billing practices don’t intend to commit fraud. They’re simply unaware of how to avoid honest mistakes that get them into serious trouble, like massive financial penalties and even jail time (really).

Learn how to avoid making the three of the most costly billing mistakes below.

Billing Mistake #1: Balance Billing

Charging patients the difference between your usual customary charge (UCR) and what their insurance pays can result in a surprise for your patients — and it’s not a welcome one.

Unexpected medical bills have been a focus for auditors and regulators for quite some time, and they’re actively cracking down on unethical balance billing. Balance billing is typically illegal when it comes to payers you’ve contracted with.

By being in-network, you’ve agreed to accept the payer’s reimbursement as payment in full (aside from any deductible, copay, or co-insurance). And while it is legal to balance bill out-of-network patients, you must tread extremely carefully:

• Most balance billing regulation is intended to fix situations where patients visit an in-network hospital, but some of the providers (the anesthesiologist, for example) are out of network. For providers in private practices, there may be times when an out-of-network patient wants to see you because they see value in your care as compared to their in-network providers. Be completely transparent with out-of-network patients regarding your status — ideally in writing.
• Accurately estimate costs in advance for providing services for out-of-network patients. Provide this estimate in writing, and ensure that patients understand all of the charges.
• Your UCR should be the same for both in-network and out-of-network patients.
• Include balance billing practices in your written financial policy and ensure there is a signed copy of this policy in every patient file.

Billing Mistake #2: Waiving Patient Payments

If you think that you’re doing patients a favor by waiving their co-pay, deductible, or co-insurance, think again. By waiving patient payment responsibilities, you’re putting your practice in jeopardy with both payers and federal regulators.

For one, you’re contractually obligated to your payers to collect patient cost-sharing amounts. Not doing so is a violation of your contract. Plus, you could potentially be violating federal fraud and abuse laws.

While there may be times that you waive a patient’s payment, you should never do so routinely — that could be interpreted as an inducement to refer and is a violation of the Anti-Kickback statute. In addition, make sure you do the following to make sure that when you do waive a patient payment, you’re staying compliant:

• Have clear, written policies regarding hardship discounts/fee forgiveness. Do meaningful due diligence before approving such waivers for patients, and ensure there is reasonable documentation of hardship in the patient record. Evaluate all patients for fee forgiveness using the same criteria (for instance, U.S. poverty guidelines).
• Never advertise that you will waive copays or use “insurance-only billing.” Be sure to train marketing staff on compliance issues.
• Be careful when writing off out-of-pocket payments. Make sure you have a written collections policy that includes guidelines for writing off bad debt and make sure your billing staff follow that policy consistently.

Billing Mistake #3: Professional Courtesy

Are you providing free or discounted care for your staff, other physicians, or their family members? If so, you must be wary of violating fraud and abuse laws. Why? Any type of free or discounted care could be interpreted by regulators as offering an incentive to gain referrals. But don’t let that scare you away from offering professional courtesy discounts completely. Following these simple tips will ensure you stay on the right side of the law:

• Avoid cherry-picking providers to whom you extend professional courtesy. Instead, either offer it to everyone or if that’s too broad, then to a specific group (for example, everyone in your geographic area or your specialty).
• If you extend professional courtesy in the form of waiving copays, do not also submit a claim to the payer. Waiving a copay while receiving reimbursement from the payer could be interpreted as violating the Anti-Kickback statute.
• Again, having a written policy (one that you follow) is important. Make sure that professional courtesy guidelines are part of your financial policy.

For more on best ways to handle write-offs and balanced billing and implement top strategies into your practice, sign up for the must-attend online training “Head Off Costly Legal Headaches” by attorney, Heidi Kocher, BS, MBA, JD, CHC. Heidi is uniquely qualified to provide you with the practical advice you need to prevent slipping up on billing laws and regulations.

During her 60-minute online training, she will give you the tools you need to stay off audit radars, avoid a stressful audit and massive penalties.

---

Commonly Viewed Billing Online Training