Recourse for negligent billing service costing our practice thousands!?

[thatcuteblonde]

This is an unusual question, however I was hoping someone might be able to answer it. I recently took a position with a multispecialty practice who was looking to bring their billing in-house from a biling company after they realized that they had been losing money.

They notified the billing company of our decision not to renew our contract and they held us a clause in the contract that allowed them another thirty days worth of billing. We have been using this time to review the past years worth of claims, info, etc. and have encountered some disturbing and extremely costly errors. One of our physicians is paid based upon the amount collected, so our agreement with the billing company was all payments had to be posted by the end of business every Friday, so that payroll for this physician could be done on Monday. When we noticed a $20,000.00 Medicare check had not been posted, we brought it up to the biling co who insisted it was simply a one time issue of timing and had never happened before, however when we started comparing old reports to what is currently posted on the same date, there was a difference of $8,000.00 just for one week!

In addition to this issue, which could end up costing the practice tens of thousand of dollars in back pay owed, we have found over $20k in charges that were never entered, W/C claims billed with non-existant date of injuries and data entry errors that will result in God knows how much lost revenue. The billing company has given us very limited access to their system, removing the custom report capabilities and other features. When confronted with these errors, mistakes and problems, the owner of the billing company has shrugged them off. Do we have any recourse? They have not kept up with their responsibilties, yet have been compensated and their negligence at this point has cost our practice at least $100k.

Can we sue the billing company or is this unheard of? Has anyone else experienced anything like this before and how did you handle it? 

[Pay_My_Claims]

Wow, I would think they can. This is one reason they have E&O insurance. My question is how were they able to do that for so long. If I had a practice and hired a billing service, I would monitor that as I would my in-house biller. Physicians should hire help, but they should also be knowledgeable enough of the job to be able to monitor it. They should have been using the billing service reports to submit to the CPA for accuracy. Good blessings in seeking out what to do. I would surely consult an attorney!!

[DONNA]

Our Company recently went thru the same problem with a billing company. When the Dr.decided to bring the billing back in house (where it should always stay so you know what is going on) we found that 90% of claims that had 2nd insurance were never billed to the 2nd. So of cause timly filing was our big issue not just for 2ndry but primary as well. This service was nothing more then a data entry company. No follow ups were done, no errors corrected ,claims were just resubmitted. We also had the problem with  limited access to their program. It was a mess to try and find any sense to what they did.  The Dr. had his attorneys working on this for the longest time but in the end at least $100.000 had to be written off as a loss.   

[Michele]

Unfortunately billing services like yours give us good ones a very bad name.  And yours is way too common of a story.  I am not sure but I would think you could sue.  After all, they were supposed to be providing a service and obviously they were not doing what they were supposed to be.

However, in response to Donna, this actually can work both ways.  We went into an office where the billing was done in house and we found that their biller was causing them to lose $500,000 per year.  I know sounds incredulous, but it was true.  She was doing all billing in house, right under the dr's nose, and was costing him a 1/2 million a year.  She didn't bill out ANY inpatient hospital visits or nursing home visits because she didn't like the format the dr gave them to her in.  One of the docs (3 drs, 3 NP's) was director of 3 nursing homes.  They also had one NP that was strictly at the hospital.  Paying her whole salary but never receiving a penny for her work.  Also, she didn't bill any Medicaid because she couldn't get the forms to print properly.  I could go on, but I'm sure you are getting the picture. 

Anyway, the important thing isn't whether the billing is being done in house or out, but whether there is accountability.  Dr's must be aware of what is happening on the business end.  They should know what is being billed out, what is being collected, what is being written off, patient balances, etc.  I am a responsible billing service and I welcome and ENCOURAGE my providers to see my system, view my reports, and be completely aware of all that we are doing.  Mostly because I am very thorough, and I do a good job, and I want them to know how hard I work to collect their money! 

I sympathize with those offices & providers who have had a bad billing service experience. 

Good luck
Michele

P.S. In the example above, we increased that office's receivables 60% within the first 60 days, and kept it there!

[Pay_My_Claims]

Agreed Michelle........It's now where the billing is done, its actually WHO is doing it!!! There are so many that jump into thei field because they think its just a data entry push a button sort of field. It's not!!  You can monitor your billing no matter where it is done. When you submit reports to the practice they in turn compare their reports with yours. All providers should monitor the AR whether in-house or outsourced. Its your money, your business...have trust, but never blind trust!!

[PMRNC]

As someone else mentioned you should DEFINETLY consult an attorney. Having a lot of experience with contracts however, if you have determined a "Breach" of contract by the billing company than you can deem the contract ended based on that breach..However it's not quite that simple.. Depending on the contract you may or may not have a right to access their system, this is where it gets sticky. Your smallest issue is whether to let them continue for the 30 days, the bigger issue is going to be the transition. I can't really be more specific without actually seeing the contract. I am a paralegal and contracts is sort of my specialty so if you would like to forward it to me I can better guide you (Disclaimer however being I am not an attorney)

Billing companies like that give us a bad name  as Michelle said, and I too have seen it go both ways. I've actually seen more deliberate fraud and abuse IN house but in taking over for other billing companies I notice more Errors.
Someone mentioned E&O insurance.. In a perfect world, however as I have come to learn over the years no matter how much I preach this or discuss this or stress it.. Most billing companies don't put out the money for E&O.

Good luck!!

Linda Walker
PMRNC
www.billerswebsite.com

[Pay_My_Claims]

As someone else mentioned you should DEFINETLY consult an attorney. Having a lot of experience with contracts however, if you have determined a "Breach" of contract by the billing company than you can deem the contract ended based on that breach..However it's not quite that simple.. Depending on the contract you may or may not have a right to access their system, this is where it gets sticky. Your smallest issue is whether to let them continue for the 30 days, the bigger issue is going to be the transition. I can't really be more specific without actually seeing the contract. I am a paralegal and contracts is sort of my specialty so if you would like to forward it to me I can better guide you (Disclaimer however being I am not an attorney)

Billing companies like that give us a bad name  as Michelle said, and I too have seen it go both ways. I've actually seen more deliberate fraud and abuse IN house but in taking over for other billing companies I notice more Errors.
Someone mentioned E&O insurance.. In a perfect world, however as I have come to learn over the years no matter how much I preach this or discuss this or stress it.. Most billing companies don't put out the money for E&O.

Good luck!!

Linda Walker
PMRNC
www.billerswebsite.com

question.......how much responsibility (legally) does an in house biller have for the provider she works for?? What rights do a provider have when his biller's lack of knowlege or (maybe intentional) creates financial ruin for a provider?

[Michele]

I think unless you can prove intentional fraud by the in house biller, the provider's only recourse is firing the biller.  If you have an employee who is not doing their job properly, or to the best of their ability then it is your responsibility to know it.  When someone doesn't do their job, they get fired (unless you work for a bank or an insurance company, then you get a bonus!).  Sorry I couldn't leave the politics out of it.  If a provider has an in house biller who is losing him money then he needs to get her out of their ASAP and get someone in there who can maximize his accounts receivables and collect all that should be collected for his services. 

Reality is most offices are losing money due to some lack in their billing practices but the providers are completely unaware.  Like Linda said, educating them is so important, but getting them to know they need to be educated ....  uggghhhhh!

Michele

[PMRNC]

question.......how much responsibility (legally) does an in house biller have for the provider she works for?? What rights do a provider have when his biller's lack of knowlege or (maybe intentional) creates financial ruin for a provider?

If you review some case files of providers brought up on charges you will find a lot of the office managers or billers are right there with them. They hold just as much liability and responsibility.

Linda Walker
PMRNC
www.billerswebsite.com

[Pay_My_Claims]

question.......how much responsibility (legally) does an in house biller have for the provider she works for?? What rights do a provider have when his biller's lack of knowlege or (maybe intentional) creates financial ruin for a provider?

If you review some case files of providers brought up on charges you will find a lot of the office managers or billers are right there with them. They hold just as much liability and responsibility.

Linda Walker
PMRNC
www.billerswebsite.com

That's scary!! Gotta keep on my toes!!

[PMRNC]

It is scary. If you think about it the law is clear on fraud and abuse and not only does it state it's illegal to submit a fraudulent claim or commit abuse.. but that anyone BILLING SHOULD know, so it's not all about "mistakes" For example I read one case where the biller knew the provider was billing for visits when he was not in the office, but maybe she felt compelled since he was the boss, anyway both of them ended up in court with hefty fines/penalties and I think even some jail time. Some of those cases are pretty scary. I used a lot of cases to help me put together my contract .. good idea huh? 

[Michele]

I misunderstood the question, I thought you were asking more if the provider could hold the biller legally responsible if they did a poor job and caused the provider to lose money. 

Linda is right, the biller cannot do something that he/she knows is not legal just because the 'boss' tells them to.  If they know (which they need to!) that it is illegal then they have to not do it, even if it means losing their job.  Finding another job is better than jail time.

We had a provider that was charged with fraud, billing for patients that were not seen.  Being an outside billing service we obviously did not know the patients had not come into the office.  We cooperated fully with the investigation, showing all the documentation to prove that we were provided with which obviously indicated the patient had been seen. 

You have to protect yourselves and knowledge is the best way.

Michele

[PMRNC]

We had a provider that was charged with fraud, billing for patients that were not seen.  Being an outside billing service we obviously did not know the patients had not come into the office.  We cooperated fully with the investigation, showing all the documentation to prove that we were provided with which obviously indicated the patient had been seen.

There was a billing company in NC I believe that wasn't so lucky. You see they had to go to court because the laws on fraud/Abuse include verbiage that billers "Should know" apparently what happened is the blling company suspected and rather than cease operation on their billing they decided to conduct their own investigation, in court they lost because they SHOULD know. I know they tried to appeal the decision but I never found out what happened in the end.
I caught a provider who was supposed to be "supervising" a biofeedback tech, I got a daysheet faxed to me for a days worth of biofeedback services, problem was my client had called me from Florida to tell me he was having a wonderful vacation, that very morning.  I contacted him on his cell and told him and he said he has done that before and "no one would know" Well I knew and that's when I terminated him, did NOT bill the charges received that date and turned them both in. I also documented everything leading up to me finding out to CMA.

Linda Walker
PMRNC
www.billerswebsite.com

[Pay_My_Claims]

oooooh, I live in NC 

[PMRNC]

I'm pretty sure it wasn't you.. you are too smart for that!   

Linda Walker
PMRNC
www.billerswebsite.com