According to the January 2008 issue of the Healthcare Financial Management Magazine Hospitals were losing anywhere from 8% to 14% of their managed care and commercial revenue because of improper payments. I am sure with inflation the figure has probably grown, and in this economy how many hospitals can really afford to write off 8-14% of their revenue?

In Performing a Retroactive Managed Care/Commercial Underpayment Review on our most recent client it really hit me in the face how much money Hospitals are leaving on the table. I am sure most CFO’s and Managed Care Directors believe all you have to do is bill the claim and the managed care and commercial companies are going to pay the proper amount. There is nothing further from the truth. Other facilities have Managed Care Contract Monitoring Systems to insure proper payment is received. In today’s environment there are to many variables, complex calculations and very ambiguous wording in contracts for any technological system to monitor. Only a thorough analysis of contracts and a line by line audit of payments ensures correct and proper amounts were received. We only review Outpatient Accounts for the above mentioned client and already, in 12 months, have recovered over one million dollars on their behalf. This is money that would have been lost forever, but now is in the bank of our client. I urge all Hospitals to take a look or have someone audit their payments to see what amounts are being lost.
-Bruce Jacbs
Director, Financial Management Services