Wednesday, November 26, 2014

Commercial Insurance—The Third Rail of Medical Claim Recovery

In the world of medical insurance claim recovery, medical treatment can be divided into three categories.  The first category relates to medical treatment arising from a motor vehicle accident and, for the most part, is governed by the Personal Injury Protection (PIP) or No-Fault laws.  The second category involves work place injuries, which are governed by the Workers Compensation (WC) laws and the way they affect WC insurance policies.  Relatively speaking, these two categories of claim are fairly straightforward.  Often it is apparent from a PIP or WC carrier Explanation of Benefits (EOB) whether a denial or underpayment merits arbitration or litigation.  Not so with the third category—Commercial Insurance (CI)—which we regard as the third rail of medical claim recovery.  The recovery potential of CI claims is often elusive and unpredictable, and the procedures necessary for recovery are often complex and time-consuming.

CI claims are most often governed by the insurance plan of the patient.  Most of the time the patient not only is unfamiliar with the specifics of their plan, but they often do not even have in their possession the details of the plan.  They might have some of the policy endorsements but hardly ever will they have available detailed payment terms and conditions for medical provider reimbursement.  Moreover, CI carriers usually are not very forthcoming with the plans when requested by the medical provider, even after repeated attempts to obtain the plan.  As a result, payments that are relatively low compared to the billed charges are often found to be consistent with the plan after months of effort and resources have been expended to obtain the plan.  Whereas the likelihood of recovery for PIP and WC claims often can be readily ascertained from a review of the EOB, Commercial Insurance claims often appear to be gross underpayments but are later found to be precisely what the patient’s plan called for.

In addition, from a procedural point of view, Commercial Insurance claims are far more complex than PIP or WC claims.  PIP and WC, for the most part, involve proceedings that are relatively informal, with more relaxed evidentiary rules and procedural requirements.  CI claims, on the other hand, are often resolved  in federal court, where the proceedings are much more formal.  The rules of procedure and evidence are much stricter; the time frames for resolution are much more protracted; and preliminary requirements, such as Assignments of Benefits (AOBs) and provider payment appeals, are given much closer scrutiny.  The result is a much more time-consuming process for dispute resolution.

Accordingly, CI is very different from PIP and WC, and seeking recovery without that realization can be a very frustrating and unrewarding exercise.  We believe in large measure we have overcome the pitfalls noted above.  We have developed a new approach to seeking recovery of these claims, an approach that is mutually beneficial for the medical provider and Callagy Law, and one which imposes no financial risk on our clients.   Our approach does not work with all types of providers, but it is one that we believe will prove successful with the types of providers who fit the model.
Contact us.  We would be happy to discuss whether your practice is the type of practice that is a good fit  for our new approach.

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Time Management for Client Liaisons: The Key to Good Customer Service


The foundation for being a successful client liaison is effective time management.  When client liaisons understand how long a task should take, they can manage their own schedule efficiently and better manage the client’s expectations.   

At the start, it is important to understand that client liaisons have a great deal of independence. Much of their time is spent in the field, because the role primarily involves hands-on interaction at the client’s location.   Liaisons are free to make their own schedule, and rightfully so, because only the liaison knows the schedules, workflows, and logistical preferences of the medical practices they service.  Accordingly, the ability to manage time effectively is not only important, but is fundamental to the role.

Client Liaisons are the bridge between the Law Firm and the provider’s medical facility, with the responsibility to keep the provider informed and updated about all their files, and to give the provider a sense of assurance that they are being serviced effectively.  However, spending too much time servicing a provider can be as detrimental to a liaison’s performance as spending too little time.  
The goal is to “pull” all the files that can be pulled as soon as possible, which means liaisons must have a good sense of how many files a particular provider generates each month, how much time is needed to work the files, and how often to visit to make sure those files are pulled.  The goal is to exhaust the provider’s monthly universe of files.  Every provider is different in terms of the number of files they generate, the nature of the files they generate, and the logistics of working those files.  Client liaisons need to determine the optimum amount of time to spend with each provider.  This optimization process benefits both the provider by identifying as many good claims as possible as quickly as possible, as well as the Law Firm by maximizing the business brought in to the Law Firm from that provider.

At the same time, the liaison must be careful about not neglecting smaller providers.  The liaison must be sensitive to the smaller provider’s needs and grant the smaller provider sufficient enough time and attention to feel like they too are important to the Law Firm.  A visit once per month might still only generate a small handful of files, but it might be necessary for effective customer service. 
Effective time management is the key to this process.  Of course, there are other elements a liaison must bring to the job—communication skills, knowledge of the client’s needs, responsiveness—but without good time-management skills a liaison will not perform well, regardless of how skilled the liaison is in other areas.

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The Initial PIP Patient Encounter: An Opportunity to Obtain the Proper Documentation to Avoid Bill Denials and Payment Delays  

The first priority for all health care providers is treating his or her patient.  However, when it comes to proper payment for that treatment, documentation to establish eligibility for PIP reimbursement is critical.  The first patient encounter results in an enormous amount of paperwork for both the PIP patient and the health care provider.  With so much documentation exchanging hands it is easy to miss documents that will be needed when time for payment comes around.  Here are a few ideas for documentation that will help make obtaining PIP payments for treatment run smoother.

Assignment of Benefits
First and foremost, the key document for PIP reimbursement is the Assignment of Benefits (“AOB”).  This document allows health care providers to obtain payment directly from insurance companies.  While all providers have some form of AOB, many contain language that is routinely challenged by insurance companies.  The language of anAOB should give the health care provider the right to obtain payment directly from the insurance company and to proceed through any other means available, such as through arbitration or the courts, in order to obtain payment.  This allows the health care provider to proceed to arbitration or lawsuit if the insurance company denies payment for any reason.  The AOB should have the health care provider’s name prominently displayed to show that it pertains to that specific health care provider.  It should also be clearly signed and dated by the patient or guardian with a printed name to avoid any ambiguities that the insurance company may see as a reason to deny payment.

PIP Application
Apart from the AOB, the PIP application is the most important document needed when seeking PIP benefits from an insurance company.  This document conveys much of the information the insurance company needs to establish eligibility for coverage including policy number, insured’s name, patient’s address, accident location, injuries, and lost wages.  Failure to provide this foundational document results in the denial of many claims.  This document acts as a first step in opening up a claim for a health care provider for PIP benefits.

HIPAA Release
Under the Health Insurance Portability and Accountability Act (“HIPAA”), patient privacy was made a byword for all health professions.  All health care providers take this requirement very seriously.  While maintaining the highest standards of privacy, at times the sharing of medical information is necessary for consistent continued treatment between health care providers and for legal professionals who seek PIP reimbursement for treatment performed.  A standard HIPAA release for medical information is a legal document that allows providers or legal professionals to obtain medical documentation to facilitate continued treatment and to provide records to show the “medical necessity” of treatment in order to obtain payment.
Many times a PIP patient is referred to one health care provider from another for the purpose of continuation of treatment.  This health care provider may need medical documentation that he or she does not already have.  In addition, when a legal professional is attempting to establish “medical necessity” for the treatment of one health care provider, it is necessary to have the medical records of another provider.  As a result, a HIPAA release is a valuable tool to obtain this documentation when needed.  It is recommended that during the initial patient visit, a HIPAA is signed and dated by the new patient, allowing you “and your legal representatives” to obtain medical records from other treating physicians or MRI facilities.
It is very important to explain to the patient what the release means when it is presented to them for signing and the limited uses for which the release can be utilized.

Affidavit of No Insurance
In many instances in PIP, the patient will be seeking benefits from someone else’s automobile insurance policy.  This occurs when a patient has no insurance of his or her own and is seeking PIP coverage through a resident relative or the owner of the vehicle in which he or she was an occupant.  When this occurs, the insurance company that is billed for treatment rendered is very curious as to what other coverage the patient may be entitled to.  To obtain this information, the insurance company will require an uninsured patient to sign an Affidavit of No Insurance (“AONI”).  The AONI is a sworn document contemporaneously signed by a Notary Public which identifies a patient’s address; whether he or she was a named insured under a policy of automobile insurance; who he or she lived with; the relationship to the patient; and whether any of those people with whom he or she lived had their own automobile insurance.  This is done in order to see if there is other coverage within the household that would be liable for payment of PIP benefits.  Many insurance companies will deny benefits to a provider if this documentation for such payments is not provided.
While not exhaustive, these documents will facilitate prompt payment of claims and avoid many eligibility issues that may arise.
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Tuesday, November 18, 2014

The First Amendment at Work: A Unicorn’s Tale

I was flipping between radio stations on the drive home one summer day when I heard my favorite sports radio host in a heated rant over freedom of speech. A football player, Don Jones of the Miami Dolphins, had been reprimanded by his team for a tweet he made. Though the host disagreed with Mr. Jones’s opinion, he was furious over the fact his first amendment rights were trampled. Caller after caller chimed in their displeasure about the Constitutional travesty that the Dolphins had committed. The future of the Country was in doubt!

But was there really a reason to be alarmed? A reading of The First Amendment should ease all the worries. The First Amendment of the United States Constitution states the following:

“Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances.”

The text prohibits the government from restricting the freedom of speech. However, it does not prohibit private entities from taking action against their employees. The First Amendment applies to the government alone. Thus, if law enforcement arrested or fined Mr. Jones for his tweet, it would be a serious violation of his First Amendment rights. That’s not, however, what happened here.  We can breathe a little easier.

The truth is this situation should encourage us. The government didn’t interfere with Mr. Jones’s tweet and it didn't interfere with how the Dolphins decide to run their business. Freedom of speech was preserved. Thus, while saying your supervisor is a jerk won’t get you arrested, it could sure get you home sooner than you were expecting. Freedom of speech at work, unless you work for the government, does not exist.

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Help Us Help You: The Role of Medical Documentation in New Jersey PIP


When a medical provider treats a patient for injuries caused by a motor vehicle accident, the medical documentation will often determine if reimbursement is required by the auto insurer.  The provider has the burden to prove the treatment was medically necessary and reasonable.  Miltner v. Safeco Ins. Co. of Am., 175 N.J. Super. 156 (Law Div. 1980). Generally speaking, the provider must carry that burden by a preponderance of the evidence.

Pursuant to N.J.A.C. 11:3-4.2, “medically necessary” or “medical necessity” means that the medical treatment or diagnostic test is consistent with the clinically supported symptoms, diagnosis or indications of the injured person, and; (1) The treatment is the most appropriate level of service that is in accordance with the standards of good practice and standard professional treatment protocols including the Care Paths … as applicable; (2) The treatment of the injury is not primarily for the convenience of the injured person or provider; and (3) Does not include unnecessary testing and treatment. 

Focus on the phrase “clinically supported.”  This means the provider personally examined and evaluated the patient in making an assessment of the patient’s subjective and objective complaints, as well as considered prior test results and recorded all observations and findings.

It is imperative to recognize The New Jersey Department of Insurance and Banking (“DOBI”), the regulatory body for New Jersey PIP, has adopted Care Paths, which are “typical” courses of intervention in the treatment of a patient.  DOBI recognizes the Care Paths may vary, depending on the medical needs of the patient.  Deviations, however, must be properly documented to increase the likelihood of success at arbitration.  For example, a patient may have co-morbidities or pre-existing conditions requiring more or different treatment that would otherwise be typically provided, but this must be explained in the documentation by the treating doctor.

For example, let’s say a “typical” course of treatment for someone injured in a motor vehicle accident is x weeks of conservative care, such as chiropractic care.  If that patient has a co-morbidity that would require additional conservative care and the patient continues to improve with care, this additional care could generally be deemed medically necessary if the medical records support that position. 

Similarly, let’s say the patient remains symptomatic after a “typical” period of conservative treatment, and the “typical” course of treatment at that stage would be surgical intervention.  What if the patient does not want to undergo surgery at that time for reasons also explained in the medical record?  That important information might provide a reasonable basis to continue with conservative care and/or injection treatment.

Check the Medical Denials.  Auto insurers are required to have medical denials before they may properly deny treatment based on medical necessity.  N.J.A.C. 11:3-4.7(c)4 provides,  “All determinations on treatments or tests shall be based on medical necessity and shall not encourage over or underutilization of benefits.  Denials of decision point review and precertification requests on the basis of medical necessity shall be the determination of a physician.” 

Make sure medical denials address the requested treatment, and the insurer’s doctor is of the same specialty as the treating doctor.

Three day Rule.  Auto insurers are required to respond to a provider’s pre-certification request in three business days.  Check to see when the insurer responds to your request.  (Make sure you can prove the day your request was sent, and that it was sent to the proper facsimile number, etc. of the insurer.)  An untimely denial may be another way to show medical necessity of treatment.

In sum, the role of medical documentation in a New Jersey PIP arbitration is paramount.  If the treating doctor documents all clinical findings made by thorough evaluation and examination, and then explains the medical basis for recommended treatment, our chances of success are increased significantly.  As Jerry Maguire has so eloquently stated, “help us help you.”

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The Perfect PIP File—What We Need / What We Want

In order to pursue a Personal Injury Protection (PIP) claim on behalf of a medical provider, several documents are critical.  There are also several documents that are important but not necessarily essential.   Discussed in detail below are both the documents that are critical to pursuing a PIP claim successfully and those helpful but not necessarily indispensable. 

First and foremost among the documents critical to a PIP file is the Assignment of Benefits, or AOB.  Prior to execution of an AOB by the patient, there is no relationship between the PIP carrier and the medical provider when it comes to that patient’s medical treatment.  The relationship exists between the carrier and the patient through the auto insurance policy, not between the medical provider and the carrier.  Through the AOB, the patient transfers to the medical provider his or her right to be reimbursed by the carrier for the medical treatment.  Without the AOB, the claim cannot be arbitrated. 

Also critical for a PIP claim is the Explanation of Benefits (EOB), which serves as the evidence of what the carrier paid and its justifications for paying or not paying in the manner it did.  Without the EOB, it is impossible to challenge the carrier’s position, because there would be no clear understanding of the carrier’s position. 

Finally, the bill—HCFA or UB—along with the medical records supporting the bill are critical.  The bill, of course, sets forth the expected payment, and the medical records supporting the bill are the proof that the services were rendered.  Depending upon the reason for the denial or underpayment, the medical records supporting the bill might not be enough to succeed on the claim, but, at a minimum, clinical records are needed to prove the services were actually rendered.

Examples of additional clinical records that might be needed are the treating physician’s treatment records preceding the date of service being arbitrated.  If a facility, such as a hospital or ambulatory surgery center, is seeking reimbursement for a procedure performed by one of its surgeons, and the carrier denied reimbursement on the grounds of medical necessity, the operation report describing the procedure is a critical part of the claim, but it does not help to establish the medical necessity of the procedure.  It describes the procedure but does not justify it.  Similarly, if the provider is a pharmacy or durable medical equipment (DME) provider, the prescription for the drugs or equipment is necessary, but does not prove the drugs or equipment were medically necessary.  The treating physician’s notes are needed for that.

Often the best approach is to include in the file all the available medical records from beginning of treatment to the end, including pre-certification requests, with fax confirmations, and insurance correspondence in response to the requests.  This would include medical records from other providers, assuming they are available.   For example, having an Emergency Room record might help prove medical necessity of physical therapy treatment 6 months after the date of injury.   Also helpful, though not critical, are the police report, the insurance declaration page showing the policy limits, and the PIP application.   

The expression “Less is More” does not really apply to PIP arbitration, at least not at the stage when the relevant documents are being assembled.  It is always helpful to include more documentation, especially clinical records, in the material initially assembled to pursue a claim, rather than less.  In this case, “More is More, Not Less.”

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Thursday, November 6, 2014

5 Contract Tips for Avoiding Litigation

Learn the mistakes that could cost your business millions!

litigation






Original Article from NJ Business Magazine
The unwanted visitor hands you a stack of papers and says, “You have been served.” Your heart sinks and mind races. What will this cost? How long will this take? Why would someone do this? This happens every day to people just like you. Your cost can be tens of thousands to upwards of a million dollars.
Many business owners see the world of “litigation danger” as a function of bad luck and out of their control. They are mistaken. You have the power to dramatically reduce the risk of a lawsuit and contain costs.
Other than insurance covered injury, suits flow from a failure in one of four types of your relationships: outside vendors; clients; employees; and co-owners.
However, the basis for the problem in these relationships was created in the beginning, when things were great; not now, when the suit is pending.
What can you do about all of this? Quite simply, follow these five critical steps.
  1. Take the time – at the beginning, when both parties are happy and positive – to have written contracts in each of the four key relationship areas. Incorporate virtually everything into your agreements.
  2. Do not let anyone rush you through the process or talk you out of all that “lawyer stuff.” You will spend exponentially more money later if you do not take the time to make the investment today to protect your business.
  3. Two key clauses to remember – The most overlooked clause that is the great equalizer is a well-crafted fee shifting provision (who pays for attorney costs). This is the most underutilized tool in keeping parties out of lawsuits and containing litigation costs. Simply put, fee shifting keeps people more honest.
    In addition, arbitration clauses can be of great value. In light of a recent New Jersey Supreme Court case, the language must be very specific and include an express waiver of a right to a jury trial.
  4. Review what you already have – even if you implement these changes going forward. What about your existing agreements? A review is essential to see what you have, especially with other owners.
  5. Seek the advice of an attorney who has an in-depth understanding of all of these issues. Do not rely on your own counsel.
Not wanting to deal with this issue is completely normal and understandable; not dealing with it is also horrendously foolish and dangerous for your business.
At best, litigation is frustrating, costly, invasive and embarrassing. At worst, it will destroy your business.

About the Author: Sean Callagy is founder and president of Callagy Law, LLC. The law firm is based in Paramus and has additional offices in New York City and Phoenix, Arizona.

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Tuesday, November 4, 2014

The PPO Contract—Beneficial or the Sleeves from a Vest?

Joanne Harte, Client Liaison at Callagy Law

Generally speaking, a Preferred Provider Organization (PPO) contract is an agreement between a medical provider and a managed care organization.  This managed care organization creates, on the one hand, a network of doctors, hospitals, and other health care providers, and, on the other, a group of insurance carriers who presumably will be the payers to those medical providers when those providers render medical services to customers of those carriers.  The medical providers generally agree to reduced rates in exchange for expeditious and predictable reimbursements; the carriers agree to pay more quickly in exchange for paying less. This is mutually beneficial, in theory, as the insurer will be billed at a reduced rate when its customers utilize the services of the PPO-member medical provider and the provider will be paid promptly.

Insurance carriers certainly prefer these arrangements.  If they did not, it is unlikely these arrangements would be as pervasive as they are.  The question medical providers need to ask is whether the PPO’s to which they are committed are worth it.  Are you receiving a benefit or simply the sleeves from a carrier’s vest?

Membership in a PPO network allows for a substantial discount below the medical provider’s regularly charged rates, often ranging from 10% to 35% below billed charges or 10% to 20% below applicable fee schedule amounts. Sometimes PPO’s call for flat rate payments for particular services or treatment, whereby a provider might receive a few hundred or a few thousand dollars for treatment they would normally bill at two or three or four times that amount. The point is these agreements can call for very significant reductions.  More often than not there is a very substantial downside to these arrangements for medical providers.  In the motor vehicle accident arena, otherwise known as PIP, there already are state-imposed fee schedules in place for most services.  If that is the case, why allow for an additional PPO reduction from those already relatively low reimbursements?

Also, signing up with a PPO network could “spider web” into being forced into unseen arrangements, also known as Silent PPOs, which are not fully communicated to the provider upon presentation of the agreement.  A provider might bill a carrier expecting 100% reimbursement only to find that the carrier, unbeknownst to the provider, is signed up with that managed care organization or is submitting bills to a third-party administrator who has essentially "leased" the PPO.  The result is that a medical provider might end up offering substantial discounts to numerous carriers it never anticipated and from which is derives no benefit.

The bottom line is that medical providers need to analyze whether the supposed upside of such an arrangement outweighs the downside described above.  Let us examine that supposed upside.

Carriers in these networks usually agree to pay within a defined timeframe, 60 or 90 days for example.  If the carrier fails to pay within this timeframe, the carrier is usually required to pay the full billed charges or the full fee schedule amount, whichever one was applicable; basically, the carrier forfeits its right to a discount.  But is this a penalty at all?  The carrier would be required to pay the billed amount (assuming it is the provider’s usual and customary charge) or the full fee schedule amount without being a signatory to the agreement.  Also, in the context of PIP claims, carriers are required to pay within 60 days anyway, otherwise a claim can be arbitrated, and if the provider is successful, the carrier can be liable for the interest, legal fees and costs as well as any provider reimbursement.  In the PIP arena, the PPO timeframe is redundant and unnecessary.

Does the provider receive referrals that make the PPO worth it?  Perhaps they do receive referrals, but are they enough to outweigh the downside of reduced payments?  It is possible, perhaps likely, that the referrals are not nearly as beneficial as the provider thought they would be or was promised they would be.  Also, there are instances where referrals are not a relevant consideration.  For example, hospital emergency room treatment is not referral-based.  A patient is brought to the nearest emergency room, regardless of whether that hospital is part of the carrier’s PPO network.  Why make reimbursement for emergency room treatment subject to reduced PPO payments when there is little to no gain in the way of referrals to that hospitals’ emergency room.

Providers need to be more vigilant in scrutinizing, on an ongoing basis, the benefits versus the disadvantages of their PPO agreements.  The downside to these agreements is substantial; the upside needs to be more substantial.  Additionally, Providers need to be sure that PPO contracts do not open the floodgates to other networks or carrier obtaining a discount through a Silent PPO arrangement.  It is only through a thorough, ongoing cost/benefit analysis that providers can be sure they are in an advantageous PPO contract, and, before signing onto and continuing in any PPO, providers should have experienced legal counsel review the proposed or existing agreement.

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