Work Comp Billing for Hospitals: 5 Steps to Success

Posted July 21, 2017 by Jesse Larrison

When it comes to hospital billing priorities, work comp is often the last kid in line. Workers’ Compensation is complex, ever-changing, and it’s a fraction of your overall revenue. What most hospitals don’t really understand is that it is not that difficult to tame your work comp pay class, and be more profitable in the process. Here are five keys to success to consider for your billing office.

1. Bill the right payer – the first time:

65% of all work comp bills are sent to the wrong payer straight out of the gate. This can result in payment delays of up to 90 days as insurance companies return denied claims that were never theirs to begin with and hospitals are forced to investigate who the correct payer may be, track down their address, rebill, and hope that they haven’t already violated any timely billing laws in their state. At best, the hospital gets paid much later than they should, and at worst – they get a complete denial.

Solving this problem starts with Intake. Work with your Registration department on identifying two key pieces of information: 1) Did this injury happen on the job and 2) Who is the employer? If the answer to Question #1 is “Yes”, then you have a great likelihood that you are dealing with a work comp claim and you need to get the correct payer information to send the bill and possibly authorize the procedure if your state requires you to do so. Most injured workers have no clue who their work comp carrier is, so asking for their Employer information and then searching for the carrier on your state’s work comp database is the best way to ensure correct payer info. Most State Boards of Worker’s Compensation maintain a free database for you to use on their website. This is a useful tool – use it often!

2. Don’t just guess on what you are owed:

Insurance companies pay hospitals the correct Fee Schedule amount only 32% of the time! If you don’t know what payment to expect, you’ll spin your wheels appealing payments and miss other opportunities in the process. While some portion of your work comp patients will have claim jurisdictions outside of your state, along with Federal employees and other anomalies, the vast majority of your work comp claim load should be paid pursuant to the Fee Schedule or Usual and Customary procedures in your state. Most states publish this rate information on their website free of charge, or it can be purchased from a data supplier for a few hundred dollars. Modeling the correct amount for your state’s Fee Schedule is well worth the time on the front end to ensure you are being paid accurately and appealing the correct claims on the back end.

For more information on how steps 3-5 impact the workers’ compensation billing process, contact us.

3. Send the bill the right way

4. Set goals and measure success

5. Make the call on insourcing vs. outsourcing