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BEGINNERS GUIDE TO MANAGING YOUR ANAESTHETIC PRACTICE | ||||
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Disclaimer: This beginner’s guide was produced as a service to participants of the NSW ASA “Going into Practice” meeting on September 2, 2000. The opinions expressed here are those of HealthBase Pty Ltd and do not necessarily reflect the opinions of the ASA or any other medical organisation. If you prefer, you can download an updated version (Sept 2002) of this guide in Word format by clicking here. A beginner's guide to managing your private anaesthetic practice Who
should do the billing?
The simplest option is to do it yourself. Other options are
to have a family member, friend or secretary do it, to use a billing service,
share a secretary with another anaesthetist, or use the services of your
anaesthetic group. A busy anaesthetist may only need 1-2 half days of
secretarial work per week, less for staff specialists and part-time workers.
It is advisable to initially perform the billing yourself so that you can
fully understand and advise others on using whichever system you have chosen.
It is important to train the ‘secretary’ and check his/her work until you
have confidence in them.
Choose an accounting system These days, a dedicated computer is essential for
your anaesthetic practice, not only for accounting, but for all kinds of
educational and communication activities. Even if your anaesthetic group
provides billing services, you should familiarise yourself with how the
secretaries prepare and manage your accounts since these will reflect your own
professionalism. Billing without dedicated computer software It is possible to manage accounts without dedicated computer
software using only the MBS book, the RVG book, and a computer with basic word
processing software. In any case, in the year 2000 a computer is essential;
handwritten accounts tend to look unprofessional.
Using Microsoft Word, for example, you could create simple templates
for your accounts and receipts. Create a new document based upon the template
for each new patient and enter the relevant information into the document. You
could automate this further by creating a mail-merge document and entering the
patient, item and fee details into a table which is then merged with the
account or receipt template.
This method is really only an option if you do a very small number of
private cases since it becomes too unwieldy with many accounts. Using specialised anaesthetic software Anaesthetic billing is quite complicated and
generic accounting software such as MYOB or Quicken is unlikely to satisfy.
There are several dedicated software packages for anaesthetists in the
marketplace. Access
Anaesthetics provides all the functions required to streamline your
billing, receipting, banking and reminder systems to keep a comprehensive
record of your business activity. This will increase your practice efficiency and provide a
professional look to your correspondence. Types
of accounts
MBS. The most basic accounts charge the MBS ‘schedule fee’. This is the
total amount that the patient will be rebated from Medicare and their health
fund. Since the MBS rebates lag well behind what is considered appropriate
remuneration for anaesthetic services, it is usual to add a percentage to the
schedule fee. Although this method is in common use, it is intrinsically
flawed since the fee is set with reference to the activity of the surgeon, not
the anaesthetist. It is advisable to obtain the actual surgical item numbers
performed for each operation directly from the surgeon or his secretary. This
will ensure the maximum rebate for the patient. Such accounts are sent
directly to the patient.
RVG. Use of the RVG in setting fees is recommended by the ASA. It specifies
a basic anaesthetic unit value for standard operative procedures according to
the difficulty of the case. A fee is determined by adding the number of basic
units for the procedures performed and then adding a number of time units
according to the time the procedure took. Additional ‘modifier’ units are
added according to the degree of difficulty, out of hours work and so on. The
total number of units is multiplied by an individually-determined dollar value
per unit. This method generates a fee which is determined according to what
the anaesthetist (not surgeon) did. RVG fees may bear no relation to rebates
based on the MBS ‘schedule fee’ and are usually higher, requiring patients
to incur significant ‘gap’ payments.
Third Party and Workers’ Compensation. Where an operation is performed
in relation to a motor vehicle or occupational accident, the account is
usually sent to an insurance company or solicitor rather than the patient. In
NSW, most third party and workers’ compensation insurers prefer to receive
anaesthetic accounts generated using the RVG, and with fees up to the maximum
unit value recommended by the AMA. It is advisable to obtain relevant
insurance company or solicitor details during the preoperative consultation.
Veterans’ Affairs Department. When sending patient accounts
to the DVA, anaesthetists may elect to be paid according to the MBS or
according to the time-based schedule developed by the DVA. In the former case,
standard MBS accounts should be generated. For ‘time-based’ accounts, you
need to provide the specific times for the procedure and details of any
additional procedures performed. You will be remunerated according to a
standard formula with a rate for the first 30 minutes then for each 5 minutes
thereafter.
Contracts.
Much has been said about health fund contracts in the past 12 months and this
is still a controversial issue. Generally speaking, an anaesthetist may elect
to provide anaesthetic services at a private hospital for which (s)he bills
the health fund or hospital directly rather than the patient. The funds agree
to pay a fixed fee to the anaesthetist which seems to be about 40% above the
MBS schedule fee. Anaesthetists should discuss this option with their
colleagues and the ASA before making a decision. What to put
on the account Essential items include your full name, provider
number, qualifications, correspondence address, telephone number for
enquiries, patient’s name/address, date of each anaesthetic service,
description of service, total fee, surgeon, date the account was sent and a
unique account number. Additional items may include any of the following; your
company name and ABN or ACN, MBS or RVG item numbers, times/duration of
procedure, hospital, claim number for Veterans’ Affairs or insurance claim,
patient’s date of birth, date of injury, discount offered, GST if
applicable, message regarding the derivation of the fee, message regarding the
overdue status of the account, payment instructions. Some anaesthetists prefer not to include MBS item
numbers on their accounts. This may be to avoid theoretical prosecution for
Medifraud if incorrect numbers are given or simply because it can be difficult
or time consuming to obtain the numbers from the surgeon. Rather, a full
description of the procedures sufficient for Medicare staff to determine the
correct rebate may be given. Despite this, accurate MBS numbers can streamline
the rebate process for patients. When to send accounts and reminders Accounts should be sent as soon as practical after an
anaesthetic. You may wish to give consideration to individual patient
circumstances such as a prolonged hospital stay. For major surgery you may
wish to wait until after a patient has returned home while for minor
procedures, sending an account the same day may be appropriate. This delay
will depend on each individual anaesthetist or on the preferences of a group.
Where payments are not received within a specified time a reminder
should be sent which includes a copy of the original account. Again, the delay
before reminders are sent should be determined by the individual anaesthetist.
Additional reminders with appropriate messages may be sent thereafter at
specified intervals. Discounts may be helpful in encouraging prompt payment of
accounts.
In some cases it may be beneficial to telephone patients to enquire
about non-payment of accounts. You may prefer a spouse or secretary to do this
rather than do it yourself. The emphasis should be on assisting the patient to
pay the account, rather than making demands.
In considering the time within which to offer discounts, send reminders
and make telephone calls it is worth noting that Medicare estimates the
following times for processing accounts: 18 days for unpaid accounts presented
to Medicare for payment to the provider, and 10 days for paid accounts
presented to Medicare for reimbursement to the patient.
For accounts where payment is not forthcoming after reasonable efforts,
it may be wise to use the services of a collection agency. Generally they will
send 2 or 3 letters to a debtor with increasing levels of ‘encouragement’
to pay. Some charge a percent of fees recovered while others charge a fixed
cost per account. Consult your colleagues to decide which agency to use or
look up the Yellow pages under ‘Debt collection services’. Determining
what to charge In setting your fees, consider practice costs, what you’re
worth, your experience, the difficulty of the procedure and the patient type
(emergency, overseas patient, ability of patient to pay, pensioner etc).
Practice costs may include rent, wages, medical defence premiums, computer
hardware and software, postage, continuing education, the cost of living in
different cities and anticipated delays in payment. If using the RVG, you may
settle on a specific unit value or, for MBS accounts, a specific percentage
above the schedule fee.
Inform your
patients about your fees Because of the low level of MBS rebates, many of your
private patients will be expected to pay a ‘gap’ especially if you use RVG
billing. Where possible, you should discuss your estimated fees with your
patients prior to surgery explaining the reasons for and likely amount of the
‘gap’. Patients may legitimately complain about large gap payments if not
informed previously. The ASA has developed an ‘Informed financial consent’
brochure which may be helpful in your discussions with patients. Other useful
brochures are also available from the ASA including ‘Anaesthesia and you’,
‘Epidural anaesthesia and you’ and ‘Pain relief’. GST
GST does not generally apply to private anaesthetic
procedures, third party, workers compensation or Veterans’ Affairs accounts.
Nor does it apply to any procedure where a CMBS number applies. It does apply,
however, to anaesthetics given for elective cosmetic surgery and to some other
procedures. It also applies to sessional payments from hospitals to VMOs.
Consult the ASA for the latest details.
Discounts Some anaesthetists find that offering a small
discount to patients helps to improve the practice cashflow and reduce the
need to chase overdue accounts. Generally discounts are offered to patients
for timely payment of accounts and if the payment is not received within a
specified period, the patient is liable to pay the undiscounted fee. This
seems to work particularly well where the period the discount is available is
short enough to require that the patient pay the fee directly, rather than to
apply and wait for Medicare and fund rebates. Important
note on fees Each anaesthetist must set his/her fees
individually after considering all factors which are relevant to his/her own
practice. The ACCC takes a dim view of making agreements with those who would
be considered your competitors. Note also that the ASA does not recommend
specific fees; its advice regarding the RVG constitutes a standard method of
comparing the relative value of different anaesthetic services. Receiving payments and handling enquiries Most payments are made by cheque received through
the mail and only few anaesthetists (usually those belonging to groups) can
accept cash payments at their rooms. Since most consultations occur at
hospitals, anaesthetists rarely require rooms. A post office box may be all
that is required.
Apply to your bank for a merchant facility so that you can accept
credit card payments from your patients by mail or phone. This is easy to set
up even for a single anaesthetist. It is convenient for patients and can be
very useful when telephoning late payers since payments can be taken
immediately by phone. These days everyone has a credit card.
Some consideration needs to be given to how to provide a phone
answering service during business hours. It’s a good idea to set up a second
line into your house with a separate number and an appropriate answering
machine message. If required, calls can be diverted to a mobile phone or to an
instant messaging facility.
It is not uncommon for patients to experience difficulties in their
dealings with Medicare and health funds and it is a good idea to create
standard letters for managing recurring problems. A set of standard letters to
deal with patient enquiries regarding fees may also be helpful. Printing
tip
Use a good quality printer. There’s nothing worse than an
account that has smudges, fading ink, or poor alignment. It reflects badly on
your professional image.
Use
a logbook
Start up a physical logbook to record all your
private cases. There is no substitute for a simple paper record of all the
anaesthetics you have ever given, especially if your practice has any
electronic problems in the future. A paper record gives you a reliable
time-referenced gold standard of the work you have done. Some examples of
logbooks are: An annual diary.
Use one such as a Collins A4 sized diary with one day per page. For each
anaesthetic you give, place a patient label on the page and write down the
details of the procedure. You may find that the page sizes are insufficient
for some days and too big for others. You can instead ignore the days and just
stick the labels and details in a chronological sequence. Then label the books
in the same way you would label an old cheque book, e.g. Jan-Mar 1999. If you
do this you won’t need a diary as such but the A4 ones are a handy size. A card system.
Buy some 5 x 3 or 6 x 4 inch blank index cards from a newsagent or stationer
and keep a bundle with you when you are working. Put a patient sticker on each
one and record the procedure details, one anaesthetic to a card. If you want
to be really organised, print a template onto the card with blanks and boxes
to prompt you for relevant information. A loose leaf folder.
For the ultimate in record-keeping, use your word processor to print a
template onto an A4 page containing detailed prompts for information to enter,
and ample space for waxing lyrical about the procedure. Keep your pages in a
set of ring binders. This may be a bit excessive for your average
anaesthetist.
Always keep the diary or cards with you when you are working so you can
use the quiet times to enter the details of your anaesthetics. This is much
easier if you do it on the spot than if you try to find time later and you can
also usually find out exactly what the surgeon did if you need to know the
accurate MBS item numbers. This saves time ringing surgeon’s secretaries
later. Create a new entry every time you give an anaesthetic, or if
appropriate, when you see the patient during a pre-anaesthetic consultation.
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