Billing Challenges Faced by Dermatology Practices and Ways to Tackle Them

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Nov 07, 2022

Billing Challenges Faced by Dermatology Practices and Ways to Tackle Them

Dermatology is an intricate and complex medical specialty ranging from lighter cosmetic procedures like Botox, chemical peels, microdermabrasion and fillers to complicated surgeries like the skin drafts and much more. And this is all that makes the medical billing process also even more complicated for a dermatology practice. Ensuring accurate CPT codes, right use of modifiers, staying up-to-date with coding changes and billing rules, extensive paperwork and documentation, and maintaining compliance with regulatory standards all pose a unique set of challenges. No wonder busy dermatology practices are on the lookout for constructive ways to handle these challenges and streamline their billing process for better revenue efficiency.

Let us in this blog discuss some of the challenges faced by dermatology practices and the strategies to overcome and streamline their billing process.

Documentation challenges

The importance of maintaining accurate and thorough documentation cannot be overemphasized. Detailed documentation paves the way for accurate coding and accurate coding ensures timely claim reimbursements. Medical documentation also serves as legal evidence that the procedure or service has been rendered. We know that there are n number of modifiers used for documentation in dermatological practices. Of these, modifier 59 is the most frequently used and misused one. Incorrect use of modifier 59 is the most common reason for claim denials in a dermatological practice. Many dermatologists have faced several issues with regard to medical documentation and the use of modifiers with evaluation management and dermatology procedural codes.

Use of different coding systems

The coding systems describe the healthcare services provided by the physicians and based on these codes billers submit claims to the payers for reimbursements. Healthcare providers generally prefer using the ICD and the CPT code systems. According to HIPAA, ICD-10-CM is the standard transaction code set for diagnostic purposes. The codes in the ICD-10 CM code set can range anywhere between 3 to 7 characters. The first character is always alpha, and the characters 2 to 7 can be either alpha or numeric. The CPT code sets describe the inpatient and outpatient procedures performed by physicians. Dermatology practices use most of these codes to bill for in-office based procedures like skin biopsy, destruction of benign or malignant lesions, surgical excisions and Mohs micrographic surgery. The E/M codes involve the use of CPT codes for billing in-patient and office visits. The medical billers should be experienced and skilled in using both the coding systems.

Dermatology billing compliance

The proper use of modifiers and strict adherence to compliance standards are essential components of medical billing for dermatology practices. Dermatologists use modifier 25 more than physicians of any other specialties. This modifier is used with the evaluation and management service done on the same day with other procedures done by the same physicians. Modifier 59 is used to indicate that a service or procedure is distinct or independent from others performed on the same day. Lack of requisite skills and limited knowledge can lead to potential overuse or misuse of modifier 25 and modifier 59. According to an article published in Dermatology Times, dermatologists submit modifier 25 with about 60% of the E/M treatments they provide as opposed to 25% for rest of the medicine. This is a sure sign that dermatologists are more affected than other disciplines by changes in the modifier 25 payment policies.

Inadequate and outdated patient data

Outdated patient information is one of the main reasons for potential billing problems and returned claims. Dermatologists face unprecedented challenges in gathering up-to-date patient insurance information. Keeping a patient's insurance information updated is critical to avoid problems and delays with your billing and reimbursement for dermatological services rendered. Taking the time and effort to double check demographic and insurance information prior to services can save your practice from dealing with rejected or unpaid claims.

Let us now discuss some of the strategies to overcome dermatology medical billing challenges

Stick to timely filing of claims

Timely filing of claims has an undeniable impact on how much and when providers will get paid. Different payers have different time limits. The time frame may even vary for different health plans within the same insurance carrier. Submitting claims within the designated timeframes makes it easier for the insurance carrier to process the claims, in a way helping physicians receive faster reimbursements.

Collect co-pays at the point of service

Dermatology practices should make it a practice to collect co-pays when the patient visits the office. Never prefer to handle co-pays at the time of checkout instead collect it in advance of the encounter. Else the collections become more expensive and difficult. Providing various payment options increases the chances of payment on the spot. 20% of most dermatology practices’ revenue comes from patient co-pays and if not collected will lead to revenue loss.

Verify and update patient insurance information regularly

Majority of regular patients are not willing to share insurance information or give their insurance card every time they visit the clinic. Even if you have a copy of the insurance card, it is important to check for any updates to patient's insurance information or other demographic information. This ensures that you deal with their insurers the right way and avoid problems down the lane.

Keep track of unpaid claims

When it comes to getting claims paid, time is money. Hence, a thorough and regular follow-up on unpaid claims will help your dermatology practice more easily collect what it has earned. If it takes longer than 60 days to get paid, it is crucial to follow-up so that you have sufficient time to make enquiries into claims and make subsequent resubmissions. Sometimes all it takes is just a phone call to get your claims paid.

If you are a dermatologist and finding it difficult to overcome the various billing challenges and stream your practice, do not worry. Scribe4Me is here to help you out. We have a team of AAPC-certified professionals who are adept at handling even the most complex billing challenges. Our experts are provided regular training to ensure they are familiar with the latest coding changes and other updates. Meaning, you can expect accurate and efficient billing services so that you receive timely reimbursements from the payers. For more details email us at [email protected].

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