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by EA Health

Most hospitals today are paying specialists to take call for their emergency departments. Gone are the days of physicians taking call for free to build a practice, or agreeing to provide uncompensated call coverage as a condition for joining your medical staff. Like it or not, you need them more than they need you.

Whether in the form of stipends, fee-for-service payments, or both, the cost of maintaining adequate call coverage is a significant expense for most hospitals. And given the fact that most specialists would rather not take call, those that are willing to do so enjoy an environment of limited supply and high demand. This combination creates a “seller’s market” and drives per diem rates through the roof in many communities.

In this era of Stark law violations, anti-kickback legislation, strictly defined safe harbors, and inurement prohibitions for non-profit institutions, inadvertently overpaying doctors for taking call (or anything else) is fraught with risk for the unsuspecting hospital CFO or CEO. Fortunately, there are a couple of steps you can take to manage and minimize your compliance risks.

Biennial Fair Market Value Analyses

Our first recommendation is that you perform a Fair Market Value (FMV) Analysis of your call compensation payment rates every two years. Be sure that the firm you engage has a thorough understanding of the current factors that make your market unique, including:

  • number, age, and availability of qualified specialists in your area,
  • call panel size (how often same MD is on call),
  • call volume (number of phone calls & trips to hospital),
  • call burden (disruption to work schedule and personal life),
  • payer mix in your service area,
  • number of unassigned and uninsured patients you treat,
  • service mix of your hospital (trauma services, etc.),
  • competition with other local hospitals for specialty coverage,
  • prevailing per diem rates in the community, and
  • any reimbursement challenges faced by area physicians.

    Market conditions change rapidly, and many physicians once willing to take call in support of their local hospital are less willing to do so as they age and/or become more successful in their office practices. A shrinking pool of willing providers drives up the per diem or fee-for-service rates that hospitals must pay to maintain adequate call panel participation. Having an updated FMV analysis that reflects current market conditions helps to establish an upper boundary for call compensation and can also be used with physicians to validate spend limits.

    Outsourced Physician Claim Processing

    Our second recommendation is directed at those hospitals offering an indigent care reimbursement program to their call panel physicians. In these programs, physicians typically submit claims to the hospital for any care they provided to uninsured patients while on call. These claims are often paid by the hospital’s finance department without verifying the accuracy of the charge (CPT) and diagnosis (ICD) codes listed on the claim. This creates a compliance risk for the hospital if the physician is paid for services not adequately documented in the medical record.

    Our solution is to outsource this physician claim processing to an RCM company capable of reviewing the indigent care claims submitted and validating the billing codes against the corresponding hospital medical records. Certified coders can verify that applicable coding principles are being followed, such as CCI edits (Correct Coding Initiative), LCD/NCD policies (Local Coverage Determination / National Coverage Determination), etc. If discrepancies are found, the contracted RCM company can communicate with the physician’s office and inform them of necessary adjustments to the claim before payment is made by the hospital. This insures that any payment made is in accordance with the services documented in the patient’s medical chart and minimizes the chances of accidentally overpaying a physician based on incorrect coding.

    The Takeaway

    Compliance is a top priority for most hospital executives these days, and for good reason. If call compensation payment rates are putting you at risk, biennial FMV reviews and outsourced physician claim processing are two very effective ways to insure that physician payments are accurate and in line with market rates.

    break the stipend cycle

    Our performance-based approach provides hospitals with a cost-effective alternative to the rising costs of stipends, while simultaneously reducing compliance risks. Schedule a consultation today to get started.