Best Practices for Laboratories Considering the Reimbursement Landscape

Ensuring financial stability and operational efficiency is paramount for laboratories navigating reimbursement challenges. Two common pitfalls are:

• Failure to stay informed about coding and payer policy changes
• Inadequate billing procedures

These issues often lead to insufficient verification of insurance coverage, incomplete documentation, inefficiencies in denial and accounts receivable management, and pose a potential risk for non-compliant billing.

Many labs rely on outdated software which may lack the functionality required for contemporary laboratory billing. This can result in convoluted processes that are difficult to update and manage.

In response, labs may add personnel to handle manual tracking of benefits eligibility or prior authorization, leading to increased labor costs. Additionally, the manual handling of denied claims, often without proper management of appeals, can result in missed revenue opportunities.

To avoid these pitfalls, laboratories can invest in modern billing software to enhance accuracy and efficiency. Choosing software built on logic, with rules and automation for handling diverse scenarios, is essential.

Finding a comprehensive solution to manage the entire billing cycle within one platform eliminates the need to add personnel for handling specific situations, ensuring a streamlined and cost-effective approach.

First, maintain current credentials with payers, negotiate favorable contracts, ensure thorough documentation, and systematically track and analyze claim denials form integral components. Maintaining a skilled billing team with extensive payer knowledge is vital for addressing the complexities of payer billing effectively and ensuring compliant billing.

Second, create a circular process to tackle issues at the front end, such as documentation and data optimization, while ensuring a smooth transition from billing front end to generating bills. Continuous follow-up on claims, along with root cause solutions to reduce denials, should occur in parallel.

Utilize back-end data to enhance front-end processes and improve collections, effectively addressing both ends of the reimbursement spectrum.

Third, when introducing new tests, consider coverage, coding, and payment aspects, verify payer willingness to cover the service, determine the payment structure, and establish a billing mechanism.

Early engagement with payers to discuss reimbursement strategies for new tests is a proactive measure to navigate the evolving landscape.

Since obtaining reimbursement for new tests may take time, labs need to strategize interim payment solutions. Checking benefits eligibility and obtaining prior authorization, even if initially denied, sets the groundwork for the test landscape. Offering patient-friendly payment options, including an online portal, facilitates payment for newly introduced tests not covered by insurance.