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IDD Payment: Billing and Compliance Considerations

Person on computer reviewing financial documents

Accurate and complete documentation is important to those providing I/DD (intellectual and developmental disability) services because the organization will need to bill by service and be able to justify each charge.

While this may sound like an easy enough concept, in practice many organizations struggle.

In situations where IDD billing is not a smooth practice, such as when charges are captured manually, the organization risks using incorrect input or missing information entirely.  Such inaccuracy can result in undercharging, where the organization won’t receive the payment that it is due. If staff overcharge or fail to document services delivered, then the organization can be at risk of fraud, potentially triggering costly audits and fines. Even when documentation and charge capture is accurate, if the associated billing process is too slow, the result can be payment delays that can affect the organization’s cash flow and days cash on hand.

Download Now: The Ultimate Guide to Selecting IDD Software

Ways Technology is Improving IDD Payment Accuracy and Speed

IDD EHR use is modernizing financial management at many organizations. In particular, the following functions are helping organizations to improve clean claim submission, support easier compliance and audit processes, enhance the speed and completeness of IDD billing, and better track and understand financial trends across their organization.

Documentation Assists

IDD service providers still operate mainly under a fee-for-service (FFS) payment model. Not only do providers bill by service, but they must also accurately and completely document each service to support the charge and reduce the risk of payment denials.

The FFS model requires accurate and comprehensive documentation to support charge integrity. The right EHR should prompt providers when documenting services for IDD payment. It should also allow providers to link documentation to claims submissions to generate bills automatically. Such automation minimizes opportunities for incomplete or missed charges and helps ensure that documentation and the billing statement are aligned.

IDD billing software should also format claims for electronic submission and tie claims to service codes while verifying against payer rules. This ensures faster IDD payment and reduces the risk of claims denials.

Easy Claims Tracking and Auditing

EHRs can help service providers track the status of claims, including denials and rejections, and quickly respond to any issues that arise. This can reduce the time it takes to resolve payment issues and increase the likelihood of timely payment and successful denials management. Tracking and trending IDD payment denials is integral to identifying and resolving documentation and coding errors and missed pre-authorizations. Easy claims retrieval is also essential for minimizing the time and effort needed to comply with audit requests.

Insurance Eligibility Verification

Medicaid is the largest single payer for long-term support services (LTSS) for individuals with intellectual or developmental disabilities. In 2020, federal and state Medicaid LTSS spending totaled more than $200 billion, according to the Congressional Research Service. Public LTSS spending has also increased over the past 20 years due to Medicare funding.

While many individuals with IDD needs are ensured through Medicaid, they may also be covered through Medicare and/or private insurance. Dual eligibility can make the billing process more complex for IDD service providers. Medicaid is the “payer of last resort” for most services, meaning it will pay for services only if no other payment sources are available.

With that in mind, service providers need to be able to verify insurance eligibility and coordinate benefits quickly and accurately. This step is critical for ensuring that individuals know what their insurance will or will not cover and their expected out-of-pocket costs.

The right IDD EHR can be integrated with payer systems to provide real-time eligibility verification for clients. This can help providers identify potential payment issues before services are provided, such as outdated insurance information or a lack of coverage for a particular service.

Customizable Billing Templates

One of the benefits of an EHR is the ability to create templates that reduce the need for manual entry. IDD service providers often work with managed care organizations and other payers, each of which may have its own rules around IDD payment. Having a staff member manually enter the different services and payers increases the likelihood of incorrect data entry. IDD billing software that includes customizable billing templates makes it easier for providers to set rules for each payer and adapt as these rules change over time.

Revenue Cycle KPI Tracking and Custom Dashboards

Paper-based systems limit the IDD service provider’s ability to track and trend financial KPIs in detail. That can make it difficult for providers to identify areas for improvement. An EHR is vital for identifying denials and allows the provider to quickly sort by denial type, payer, and service.

Also, the right EHR will enable leaders to generate reports on key revenue cycle metrics, such as average payment time, denial rates, and payment trends. This information can help providers identify areas for improvement and make data-driven decisions to optimize their revenue cycle processes.

In addition, a comprehensive view of the organization’s business performance is important. EHR use can help the service provider recognize trends in staff productivity, non-billable services, shifts in service utilization, cost of service delivery, revenue trends, and other areas affecting financial performance.

Readiness for Value-Based Care

In recent years, primary care, specialty care, and behavioral health providers have increasingly shifted from fee-for-service (FFS) to value-based payment, where financial incentive or risk is tied to an organization’s ability to improve quality and contain cost.

There has yet to be agreement about measurable and meaningful outcomes for people with IDD for use in value-based payments, as IDD service providers continue to operate under the FFS model where payment is based on services rendered. However, payer trends in IDD settings often begin to take hold in healthcare. While a shift toward value with IDD payment won't happen overnight, IDD service providers should consider this prospect when planning future technology needs.

Download Now: The Ultimate Guide to Selecting IDD Software

Technology Transforming IDD Payment Processes

Managing financial operations for IDD services on paper-based systems is incredibly challenging. As providers look to optimize the financial management of their organizations and prepare for the future, it will be essential to seek technology that supports automated charge capture and streamlines IDD billing. With staff constraints, increasing payer complexity, and continued pressure on the bottom line, the revenue cycle capabilities and financial dashboards of an EHR are becoming vital to an IDD service organization’s performance and ability to successfully serve its communities.

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