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Chapter 34 : Approaches to Billing Laboratory Services

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Abstract:

This chapter illustrates the importance of hiring individuals well versed in all aspects of correct coding, including the rules and regulations. It discusses the importance of having a comprehensive information technology platform and software resources that ensure accuracy and completeness. The chapter explains the need for laboratory personnel to be involved in the billing process and to maintain a close working relationship with members of the billing department and the relationship between complete and accurate billing and the generation of sufficient income to continue to perform expected functions. An understanding of the specific requirements for billing laboratory services and a systematic approach for ensuring that the processes are carried out as specified are key to the financial success of a laboratory. While the entire laboratory test process from test order to test result reporting to payment for services involves several categories of individuals, the actual billing process can be considered in terms of two main categories: provider mix and payor mix. Each individual payor sets criteria for payment for services. Both Medicare and Medicaid are third-party payors; payment for services provided by a healthcare provider to a patient is made by a contracted entity. Each payor may interact with each provider through one of two main types of payments: retrospective and prospective. Claims for payment are generated for submission to thirdparty payors, while invoices are generated for contractual payment by clients or by patients.

Citation: Baselski V, Weissfeld A, Sorrell F. 2004. Approaches to Billing Laboratory Services, p 567-573. In Garcia L, Baselski V, Burke M, Schwab D, Sewell D, Steele J, Weissfeld A, Wilkinson D, Winn W (ed), Clinical Laboratory Management. ASM Press, Washington, DC. doi: 10.1128/9781555817695.ch34

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Figures

Image of Figure 34.1
Figure 34.1

Payer-provider interactions in reimbursement. POL, physician office laboratory.

Citation: Baselski V, Weissfeld A, Sorrell F. 2004. Approaches to Billing Laboratory Services, p 567-573. In Garcia L, Baselski V, Burke M, Schwab D, Sewell D, Steele J, Weissfeld A, Wilkinson D, Winn W (ed), Clinical Laboratory Management. ASM Press, Washington, DC. doi: 10.1128/9781555817695.ch34
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Image of Figure 34.2
Figure 34.2

Generic billing flowchart: third-party. LIS, laboratory information system

Citation: Baselski V, Weissfeld A, Sorrell F. 2004. Approaches to Billing Laboratory Services, p 567-573. In Garcia L, Baselski V, Burke M, Schwab D, Sewell D, Steele J, Weissfeld A, Wilkinson D, Winn W (ed), Clinical Laboratory Management. ASM Press, Washington, DC. doi: 10.1128/9781555817695.ch34
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Image of Figure 34.3
Figure 34.3

Generic billing flowchart: client or patient. LIS, laboratory information system.

Citation: Baselski V, Weissfeld A, Sorrell F. 2004. Approaches to Billing Laboratory Services, p 567-573. In Garcia L, Baselski V, Burke M, Schwab D, Sewell D, Steele J, Weissfeld A, Wilkinson D, Winn W (ed), Clinical Laboratory Management. ASM Press, Washington, DC. doi: 10.1128/9781555817695.ch34
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References

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1. Adams, D. L.,, H. Norman,, and V. J. Burroughs. 2002. Addressing medical coding and billing part II: a strategy for achieving compliance. A risk management approach for reducing coding and billing errors. J. Natl. Med. Assoc. 94:430447.
2. Alwell, M. 2003. Stem revenue losses with effective CDM management. Healthc. Financ. Manag. 57:8488.
3. Barber, R. L. 2002. Prompt payment depends on revenue-cycle diligence. Healthc. Financ. Manag. 56:5259.
4. Cohen, D.,, and P. Hoffman. 2003.When putting patients first fits the bill. Healthc Financ. Manag. 57:9096.
5. Eckhart, J.,, and N. Mathahs. 2001. Physicians and compliance: developing a system that works. Clin. Leadersh. Manag. Rev. 15:222229.
6. Fee, D. N. 2002. Success with APCs. Healthc. Financ. Manag. 56:6872.
7. Hodges, J. 2002. Effective claims denial management enhances revenue. Healthc. Financ. Manag. 56:4050.
8. LaForge, R.W.,, and J. S. Tureaud. 2003. Revenue-cycle redesign: honing the details. Healthc. Financ. Manag. 57:6471.
9. McNeely, M. D. 2002. The use of expert systems for improving test use and enhancing the accuracy of diagnosis. Clin. Lab. Med. 22:515528.
10. Moss, M. M.,, and S. M. Schexnayder. 2001. Coding and billing in the pediatric intensive care unit. Pediatr. Clin. N. Am. 48:783793.
11. Segal, M. J.,, S. Morris,, and J. M. Rubin. 2002. Automated claim and payment verification. J.Med. Pract. Manag. 17:297301.
12. Smith-Shoemake, M. A. 2002. Solving the claims conundrum. Manag. Care Q. 10:1314.
13. Welter, T.,, and P. Stevenson. 2001. Calculating five types of typical underpayments. Healthc. Financ.Manag. 55:4650.
14. Wolf, P. 2001. Charge-process strategies for outpatient prospective payment. Healthc. Financ. Manag. 55:5861.

Tables

Generic image for table
Table 34.1

Types of laboratory services

Citation: Baselski V, Weissfeld A, Sorrell F. 2004. Approaches to Billing Laboratory Services, p 567-573. In Garcia L, Baselski V, Burke M, Schwab D, Sewell D, Steele J, Weissfeld A, Wilkinson D, Winn W (ed), Clinical Laboratory Management. ASM Press, Washington, DC. doi: 10.1128/9781555817695.ch34
Generic image for table
Table 34.2

Payment for services

DRG, diagnosis-related group.

APC, ambulatory payment classification.

Citation: Baselski V, Weissfeld A, Sorrell F. 2004. Approaches to Billing Laboratory Services, p 567-573. In Garcia L, Baselski V, Burke M, Schwab D, Sewell D, Steele J, Weissfeld A, Wilkinson D, Winn W (ed), Clinical Laboratory Management. ASM Press, Washington, DC. doi: 10.1128/9781555817695.ch34
Generic image for table
Table 34.3

Billing process: invoice versus claims

Citation: Baselski V, Weissfeld A, Sorrell F. 2004. Approaches to Billing Laboratory Services, p 567-573. In Garcia L, Baselski V, Burke M, Schwab D, Sewell D, Steele J, Weissfeld A, Wilkinson D, Winn W (ed), Clinical Laboratory Management. ASM Press, Washington, DC. doi: 10.1128/9781555817695.ch34

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