Developing a Business Plan to Increase Third Party Reimbursement

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Developing a Business Plan to Increase Third
Party Reimbursement

• June 28, 2003
• Presented by
• Michael R. Taylor
• Precision Resources, Inc.

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Business Plan Purpose

• Estimate potential revenue from third party
  billing and collections
• Identify operational changes necessary to
  increase revenue from third party payers
• Document steps and resources needed to implement
  billing and collections functions

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Program ProfileFirst Step to Plan Completion

• Developing a program profile is the first step to
  complete your business plan
• The program profile documents pertinent program
  operating characteristics that the financial
  model uses to calculate potential third party
  reimbursement

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Sample Program ProfileHappy Center for Primary
Care

• Grantee type School-Based Health Center
• Services offered
• Primary care
• EPSDT
• Behavioral health services
• STD/HIV screening
• Family planning
• Annual patient volume 1,000

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Sample Program ProfileHappy Center for Primary
Care

• Annual billable visits 2,500
• Patient income distribution
• lt100 FPL 40
• 100 125 FPL 30
• 126 150 FPL 10
• 151 175 FPL 10
• 176 200 FPL 10
• Patient employment rate 60

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Sample Program ProfileHappy Center for Primary
Care

• Patient age distribution
• 0 - 4 years old 5
• 5 10 years old 38
• 11 13 years old 26
• 14 - 18 years old 26
• gt18 years old 5
• Patient gender distribution
• Male 40
• Female 60

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Sample Program ProfileHappy Center for Primary
Care

• Patient distribution by payer
• Medicaid FFS 30 or 300 patients
• Medicaid managed care 15 or 150 patients
• S-CHIP 20 or 200 patients
• Commercial FFS 10 or 100 patients
• Commercial managed care 10 or 100 patients
• Self pay 15 or 150 patients

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Sample Program ProfileHappy Center for Primary
Care

• Visit distribution by payer
• Medicaid FFS 30 or 750 visits
• Medicaid Managed Care 15 or 375 visits
• S-CHIP 30 or 750 visits
• Commercial FFS 5 or 125 visits
• Commercial Managed Care 5 or 125 visits
• Self pay 15 or 375 visits

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Sample Program ProfileHappy Center for Primary
Care

• Staffing levels (FTEs)
• Billable providers
• Other clinical staff
• Payer contact information program service
  eligibility
• Medicaid
• Medicaid Managed Care Majestic Care
• S-CHIP GLH
• Commercial Green Cross

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Sample Program ProfileHappy Center for Primary
Care
Third party payment rates by CPT code
CPT CODE MEDICAID RATES PRIVATE RATES
99203 63.47 83.04
99212 21.20 35.40
99213 31.09 49.72
99215 82.82 114.58
Managed Care (pmpm) 12.00 12.00
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Sample Program ProfileHappy Center for Primary
Care

• Missed Revenue
• Clinical staff who are not regarded as billable
  providers by health plans
• Additional costs
• Itemization of costs to implement billing and
  collections functions

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Now Its Your Turn

• Develop a program profile for your program
• Accuracy is not important - guess if you need to
• The point is to familiarize you with the process
  and the tool so that you can use it later
• A blank profile template is included in your
  binders
• Take 20 minutes to complete the template

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Populate Financial ModelSecond Step to Plan
Completion
Use the information in your completed program
profile to populate the designated fields in the
financial model
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Review Populated ModelThird Step to Plan
Completion
Populated financial model for Happy Center for
Primary Care
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Business Plan Page 1
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Business Plan Page 2
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Business Plan Page 3-1
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Business Plan Page 3-2
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Business Plan Page 3-3
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Business Plan Page 4
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Business Plan Page 5
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Business Plan Page 6
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Business Plan Page 7
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Business Plan Page 8