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Common Challenges in DME Billing

Common Challenges in DME Billing

Durable Medical Equipment (DME) industry is witnessing a huge growth. Looking at the present situation, with a rising number of aging population and a whopping increase in the number of people suffering from sleep apnea and respiratory illnesses, there will be a soaring demand for home healthcare in the coming years. Along with the growth, there are many anticipated challenges one is likely to face. DME billing process has become more complex than ever, and so is its reimbursements. Below challenges can trip anyone in DME Billing and take a heavy toll on the suppliers.

  1. DME Coding Errors

The top 5 coding-related challenges a DME provider faces are:

DME Coding Errors

  • Inappropriate usage of HCPCS codes that drive a diagnostic related group (DRG)
  • Inaccurate application of the seventh character for trauma and fracture diagnosis codes
  • Misidentifying respiratory failure
  • Mistaking the use of guidance tools
  • Insufficiently documenting devices, components, grafting materials etc.
  1. Payer guidelines issues

DME Suppliers often come across payers denying claims citing following reasons:

  • Considered therapeutic services
  • Unauthorized by Medicare/Medicaid/private health insurance plan
  • Absence of strong founding in the HCPCS, which represents level II codes assigned for DME gear and supplies
  • Past permissible reimbursement level

The physicians prescribe DMEs as a major requirement of a clinical treatment, but they must ensure the medical necessity of their prescription. However, medical necessity alone may not be sufficient; It is also equally important to know upfront whether DME services are covered under patient’s plan or not. With medical billing services in New York, the complexities of DME billing can be dodged significantly.

  1. Chasing providers’ office for DOCUMENTATION:

Chasing providers’ office for DOCUMENTATION

Documentation is the primary cog in the DME billing and collection wheel. Insufficiency in documents and incorrect information prolongs the overall payment cycle. It is an effort to obtain prescriptions and other medically necessary documents from the provider’s office. This adds to the cost of business and at the same time, increases the time required to deliver the products. Suppliers may have to even hold the shipment of the supplies until documentation is complete. Certain products require more documents and the time spent on chasing them makes the suppliers feel that it is better to eliminate those products from their list altogether for better business sense.

  1. REIMBURSEMENT IMPACT:

What are the major factors affecting reimbursements?

Commercial as well as Medicare payers have reduced reimbursements substantially. DME suppliers are left with no other choice but to increase profitability through enhanced volumes. Even with increased volumes, the operational cost of managing documentation reduces the impact. DME medical billing service providers focus on this very factor and work towards reducing any adverse impact on reimbursements.

Regulatory Changes including enhanced scrutiny, tight credit markets, and advent of competitive bidding have also greatly impacted reimbursements and have given tough times to DME businesses making them outmoded and outdated. Companies are feeling the pinch from losing bids and thereby losing patients / referral sources. Even if they win the bids, it is at a much lower reimbursement rate than as was the case earlier.

DME suppliers are left with no other choice but to add more equipment and products. But even that may not guarantee more revenue as competitors are also doing the same thing selling as many products as they can including yours. How else to mitigate looking at what is happening around in the DME industry? Cut costs. With DME medical billing services in USA, the reimbursements aren’t affected much.

  1. TRAILING IN BILLING AND HANDLING DENIALS:

TRAILING IN BILLING AND HANDLING DENIALS

Billing on time is a challenge faced by supplier these days. This is restricting their company’s cash flow. There is a tendency to catch up by taking shortcuts, which doesn’t help either and further leads to complexities. Denials are piling up and mounting by the day. Most of them are not aggressively followed up as companies are burdened by increased cost to collect rates. There are instances where at least non-electronic denials are not posted. This leads to further problems including not knowing how to prevent them in the future. No data for analytics, no visibility on how the business is performing! Medical Billing service providers in USA work diligently to resolve all denied and rejected claims.

Need of the hour to mitigate the above challenges:

DME Billing companies should look to focus on:

  • Process reengineering resulting in cost optimization thereby streamlining order-to-cash efficacy
  • Transform & remodel processes and organizational structure to cater to the changing market trends at rapid pace.
  • Integrated technology intervention and analytics to drive vital business results
  • Outsourcing entire Order to Cash revenue management to curb costs and prevent revenue leakage.

Vision has rich domain expertise in the DME industry. Vision’s Billing processes have been proven for more than 13 years. We offer revenue cycle management, practice analysis, process reengineering, analytics, and AI solutions for DME providers to assist in increasing their cash flow, boost operational performance, enhance collections efficiency, and reduce revenue leakage.