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6 Simple Ways to Improve Profitability in Your Mental Health Practice

How can you as a Therapist or Psychiatrist be more profitable?

improve-profit-in-mental-health-practiceEach year we see changes in the healthcare system: Increased documentation requirements, EMR, E-prescribing and the list goes on… Most of us decided to go into the field of mental health so that we could provide quality care to our patients, and yet we find ourselves encumbered with many additional issues. How do we negotiate insurance contracts? How we make sure we get paid for services rendered? How do we maintain enough of a margin to operate our practices? How do we help patients understand their mental health coverage? There are so many items to consider when running a practice in this current environment.

Never fear! Here are some relatively simple tips to assist you in improving profitability in your practice.

1. Make Confirmation Calls

I know this sounds insignificant, but it really works! In our practice we conducted an experiment. We decided to see if confirmation calls were worth the effort of the staff. Interestingly enough, just this simple task made a huge difference in the day to day operations. On the days following no confirmation calls, no shows increased 20%-30% across the board. It appears this little task can have a significant impact on business.

2. Screen for Eligibility

For those of you who work with insurance, this is one of the most important things we can do to maximize profitability of our practices. Mental health in particular, can be confusing when it comes to insurance coverage and benefits. Often, mental health benefits are “carved out” to a different plan entirely. The patient may think they have one insurance (Blue Cross for example) but mental health coverage is run through an entirely different insurance (like Cigna). Depending on which insurance you are contracted with, this can mean the difference between getting paid for the service or not. Additionally, it is crucial to understand what benefits are covered for your client. A patient may have individual counseling covered (90834 or 90837) but not family therapy or anything related to substance abuse issues. Checking eligibility prior to seeing your client can make a big difference in the reimbursements you see.

3. Collect Co-Pays and Patient Payments at the Time of the Visit

This is an important one…Since you have checked eligibility, you know what your patient will owe based on what the insurance has reported to you. If the patient has insurance, they have a legal responsibility to pay the co-pay. According to the insurance contract, these are not supposed to be discounted. If you collect the payment at the time of service, you will increase your chances of collecting the money. If the patient is unable to pay, make sure there are payment arrangements in place. Not only does this assist you with an easy flow in your practice, it will ultimately decrease the patient’s anxiety levels that come with their bill getting larger.

4. File Claims Electronically

This is becoming less of an issue since the conversion to electronic medical records, but if you are one of the providers that is submitting claims by hand or you have a biller that is submitting claims by hand, you should consider working with your insurance companies to submit claims electronically. Often insurance companies will offer incentives of up to 5% for e-filing claims. It is really not very difficult to get set up and it can make a notable difference.

5. Code Properly

It is crucial, especially in mental health, to document the services you provide and code accordingly. Surprisingly, we often see “under-coding” in mental health as much or more as “over-coding.” It is unfortunate that a number of providers feel they need to “down-code” since insurance companies may not cover the services being rendered. I see the new coding changes as an opportunity to better clarify the services that are being provided by mental health providers to their patients. If you still have questions about the new codes, see CPT codes explained (link to CPT coding).

6. Hold your billing specialist accountable

I continue to be very surprised by the number of mental health providers, from therapists to psychiatrists who do not ask or understand what happens to the claim after it was submitted to insurance. Some providers I have talked with have told me that once the superbill is turned over to the billing specialist, there is no follow-up other than the check they see. This can be crucial to understanding how to improve profit margins. Billing is a very complex and specialized field. Your billing specialist should be able to provide you with monthly reports on what percentage of your claims are being paid in the first 30 days and what claims are outstanding for 60, 90 and 120 days. You should ask for reports on why there were denials, how the billing specialist plans on recovering the money and which insurance companies there are problems with. A good billing specialist is worth their weight in gold…
If we as providers, take a little more time to implement some of these techniques, we will see the results in our practices!

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