KHI News Service

Pilot project aims to reduce billing errors at local health departments

Effort is timely as more clients expected to be paying via health insurance coverage soon

By Phil Cauthon | October 10, 2013

Dan Partridge, director of the Lawrence-Douglas County Health Department.

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A new pilot program aimed at improving billing and collections at local health departments is beginning at a critical time: just as tens of thousands of Kansans are expected to get insurance coverage under the Affordable Care Act (ACA).

Currently, billing errors are costing many local health departments when it comes to collecting payments from private insurance companies and the Medicaid program. But that cost isn’t as significant as it could be because the lion's share of those now being served by health departments are uninsured and so pay their bills directly.

However, the payer mix is expected to change as more Kansans obtain private coverage through the new online marketplace, assuming federal officials are able to solve technical problems that have plagued the website since its Oct. 1st launch.

Further, a decision by Gov. Sam Brownback and the legislature to expand eligibility for the state’s Medicaid program – known as KanCare — also would substantially increase the pressure on local health departments to improve their billing procedures. For the time being, though, neither Brownback nor the Republican-controlled legislature appear poised to authorize that expansion.

Photo by Karrey Britt

Financial specialist Teri Davis works on billing at the Lawrence-Douglas County Health Department. Davis is participating in an Immunization Pilot Program that aims to improve billing and collections for services provided to privately insured clients. The health department was one of four Kansas agencies to receive funding from the Kansas Foundation for Medical Care for the training, certification and coding manuals.

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The billing and collections pilot

The pilot — spearheaded by the Kansas Foundation for Medical Care (KFMC), a Quality Improvement Organization — is beginning in this month in Douglas, Harper, Reno and Sumner counties.

Each of the four local health departments (LHDs) will receive up to $1,360 to train staff members on billing techniques intended to maximize reimbursement for services provided to covered clients, said Stephanie Lambert-Barth, manager for KFMC's Immunization Billing Project.

“Training of LHD billing staff will streamline the billing processes and improve billing outcomes, resulting in a return on the training investment. Demonstrating this return on investment may help other Kansas LHDs make the case to fund training for their billing staff,” she said.

The Lawrence-Douglas County health department is one of the largest and best funded in the state. Nevertheless it only has one office assistant working two days a week on billing, said director Dan Partridge.

"For us billing has been a challenge because our capacity to dedicate and train staff has been limited," Partridge said.

A chart showing the payment mix and collection rates for the Lawrence-Douglas County Health Department.

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Currently about 3/4 of his department's revenue comes from clients who pay their bills directly. The agency has an 85 percent collection rate among those clients. However, it collects only 57 percent of the amount it bills to Medicaid and only 20 percent of what it bills to clients covered by private insurance.

"Most of it is coding errors," Partridge said. "We feel confident our participation (in the pilot) will lead to improved collection rates. We also want to be prepared for whatever shift the ACA will create within our revenue streams as private insurance coverage increases."

KFMC’s Lambert-Barth said that, while the project is focused on improving reimbursement rates for immunization services, the plan is to evaluate all claims billed by participating health departments, including family planning services for example.

"Our project's final product is a strategic plan report, which will include recommendations for how to move forward. It is not yet clear what those specific recommendations will be, but if the pilot goes well then expansion (of the pilot) would make sense,” she said.

The pilot project’s website contains links to billing resources, tools, project updates and other related information.

KHI News Service coverage of Medicaid expansion

Medicaid Access Coalition launches online "ticker" showing foregone federal dollars (2/13/14)
→ KHI report: Nearly 182,000 Kansans in the ‘Eligibility Gap’ (1/11/14)
House speaker says Medicaid expansion is "up to the governor" (1/10/14)
KS Senate president says Medicaid expansion unlikely to gain approval this session (1/7/14)
Profiles of the coverage gap: Kathleen Christian (1/6/14)
Efforts continue to expand Medicaid in Kansas and Missouri (1/6/14)
Hospital association hires former Bush HHS secretary to help craft a plan Kansas Republicans might support (12/23/13)
Iowa wins approval to expand Medicaid by using federal funds to buy private insurance (12/11/13)
White House officials hold call to urge Medicaid expansion in Kansas (11/21/13)
Republican governor talks up plan to expand Medicaid — his way (10/28/13)
Challenger says Brownback owes voters a decision on Medicaid expansion (10/22/13)
Nearly 5.2M Americans fall in coverage gap in states not expanding Medicaid (10/16/13)
Sebelius: Feds flexible on how states expand Medicaid (9/22/13)
Sebelius says Kansas and Missouri are missing the boat on Medicaid expansion (9/20/13)
Medicaid expansion coalition finds strength in numbers (9/17/13)
Republican Gov. Corbett proposes expanding Pennsylvania Medicaid (9/16/13)
Kansas lawmakers urged to consider Medicaid expansion by Wesley CEO (8/29/13)
Estimating maneuver could help more people gain from Obamacare: How the poor might qualify for Affordable Care Act subsidies in states that don't expand Medicaid (8/12/13)
Report: States not expanding Medicaid stand to benefit most from doing so (7/18/13)
CMS won’t penalize hospitals in states slow to expand Medicaid (5/14/13)
Insurer Centene: We can do Arkansas-style Medicaid (5/14/13)
The Arkansas Medicaid Model: What you need to know about the 'private option' (5/2/13)
Nothing to be done about coverage gap in states not expanding Medicaid, feds say (4/29/13)
Brownback says he's listening to Medicaid expansion proponents, opponents (4/5/13)
Oregon shows costs of putting Medicaid enrollees in private coverage (3/29/13)
Governor urged to expand Medicaid eligibility (3/27/13)
Arkansas Medicaid expansion attracts other states' interest (3/26/13)
Senate president prefers options remain open on Medicaid expansion (3/25/13)
States urged to expand Medicaid with private insurance (3/22/13)
Senate budget amendment underscores opposition to Medicaid expansion (3/21/13)
Study: Kansas employers face millions a year in possible penalties without Medicaid expansion (3/15/13)
More than 30 Kansas groups pushing for Medicaid expansion (3/12/13)
Health insurers see big opportunities in health law’s Medicaid expansion (3/8/13)
Medicaid expansion supporters to step up lobbying efforts (3/7/13)
Budget committee hears resolution opposing Medicaid expansion (2/22/13)
Legislators focusing on Medicaid expansion cost estimates (2/19/13)
Kansas hospital group study predicts expanding Medicaid would generate 4,000 jobs (2/18/13)
Brownback officials release their cost projections for Medicaid expansion (2/8/13)
Medicaid expansion bill introduced (1/22/13)
Kansas hospitals worried about loss of dollars for charity care (1/14/13)
Brownback compiling own estimate of Medicaid expansion cost (12/20/12)
Group urges Brownback to expand Medicaid eligibility (11/9/12)
Debate begins on possible Kansas Medicaid expansion (10/25/12)
Amerigroup CEO says states ‘need’ to go along with Medicaid expansion (7/11/12)
Kansas hospitals ready to get on with federal health reform, spokesman says (7/2/12)
Kansas AG claims partial victory in health reform case (6/29/12)
High court upholds Affordable Care Act, but ruling puts limits on Medicaid expansion (6/28/12)

→ Kansas Hospital Association: An opportunity for the Kansas Medicaid program
→ Americans for Prosperity-Kansas: Well-intentioned policies do more harm than good
→ Health Reform Resource Project: The cost of not expanding Medicaid
→ Rep. Jim Ward: Medicaid expansion essential for healthier Kansas
→ Rep. David Crum: Reasons for opposing Medicaid expansion
→ National Academy for State Health Policy: Much ado about Arkansas: Medicaid in the insurance exchange

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