As the new year approaches, it’s time to review the guideposts that unite your legal strategy to ensure you are pursuing, securing, and resolving maximum revenue for your Motor Vehicle Accidents and Third-Party Liability claims. For the past two years, MVA accidents declined as the number of drivers on the road decreased due to the pandemic and the adoption of remote work. Data over the last six months, however, shows that the pandemic is slowing down, which means workers are returning to the office. With more cars on the road, hospital billing teams are seeing an increase for small (ER visit) and medium (surgery/observation) level accidents.
We suggest that hospitals look at the following four areas at a minimum:
1. Survey the Legal Landscape
- Our first step to look at whether a state is a “At Fault” or “No Fault” state. At Fault states have longer times to resolve as a trial may be warranted or insurance carriers take longer to ascertain who was liable. No Fault states take significantly less time to adjudicate as Fault is not an issue. This question then leads to Med Pay versus Personal Injury Protection considerations. Regardless of the type of liability law that exists, most policies have limits that can be satisfied with a handful of claims, which possibly leaves the remainder of the balance as patient responsibility.
2. Dollar Thresholds
- The next step concerns how aggressive a hospital wants to be when pursuing remaining balances. Some hospitals are happy with one payment and then move the account as a write-off. Other hospitals want every single penny owed and go to extreme lengths to ensure they are paid in full. Most hospitals though sit in the middle, wanting to pursue much of the balance, but not wanting to waste their valuable resources. Looking at setting a threshold where your office pursues the balance via legal means is a method where you can save significant time and legal fees. Your organization needs to adopt and hold firm to that threshold. Once an individual finds a team member that may relent or cave to pressure, that threshold is no longer effective.
3. Liens, Letters of Protection, or Nothing
- Our third step involves those states where liens and letters of protection are allowed. Once you’ve set the threshold, we look at the filing fees, the filing deadlines, the mandatory information, and the required service method to see if that threshold is appropriate. For states where a “notice” lien is appropriate, lower thresholds can work as there are fees for certified mailing and nothing else. For those states that require significant documentation to file a lien with the state, a filing fee, and coupled with the mailing fees, it becomes imperative to balance whether your organization can make their money back. Once you’ve looked at the type of lien, it becomes imperative that you review the timely filing consideration. Some states allow a hospital to file a lien up to a settlement. However, other states have a statute of limitations that begins to run the day the patient is discharged from the hospital. These questions allow an organization to balance the needs of their organization versus the legal requirements.
4. State/Case Law Regarding Settlements
- Finally, you need to analyze if there are significant statutes or case law that must be followed or limit a hospital’s settlement. When you review the legal landscape, your team should also review relevant legal research to determine if there are odd procedures, requirements, or caps on your ability to settle a claim. In some cases, some states limit the amount the hospital can acquire from a settlement to one-third of the settlement amount. Other states allow attorneys to retrieve their fees first and then the remainder can be split. Some states allow a cap on the amount a hospital can acquire from a settlement while others require a pro rata split between the available parties. Knowing these restrictions allow hospitals to better understand how much they can recover in addition to all the upfront costs that your organization had to pay to get to this point.
Looking at these four areas, you can begin to shape your organization’s strategy as it relates to being passive or aggressive in pursuit of monies you’re owed.
Once your organization has an opportunity to review your four guideposts, you should be able to craft an effective resolution policy. Your team needs to review this policy at least once a quarter as turnover is an unfortunate reality, misunderstanding occurs, and adherence to this policy is paramount to having an effective program. While keeping a case-by-case review basis sounds more engaging, it’s important to remember that your time and resources can quickly disappear, and you may unintentionally make your organization an easy target. Keeping a blanket policy with certain limited exceptions or exclusions allows your organization to accept targeted reductions or write offs when those patients meet certain financial requirements. A clearly written, updated, and understood legal strategy allows your staff to spring ahead of possible pitfalls, which can boost your bottom line.
Balancing all of this requires a dedicated team with the expertise to be successful. EnableComp can be that resource throughout all the various stages of the MVA claim cycle, with a single goal in mind: getting paid the right amount, in a reasonable time, while remaining compliant and respecting the patient experience. If you need assistance with processing your MVA hospital claims to decrease your accounts receivable aging, increase patient satisfaction, and transform your complex claims into revenue, please contact EnableComp. Our clients are currently seeing a 25% increase in collections through settlement negotiations.