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Medicaid Makes Treating the Poor A Collections Hassle

October 12, 2004

Editor's Note: The Doctor's Office is a new online column about the
issues, challenges and rewards facing physicians today. It's written by
Dr. Benjamin Brewer, 36, a solo family practitioner in Forrest, Ill. We
welcome comments from physicians and patients alike.

Awash in a spectrum of gold and brown, the fully ripened fields of
Central Illinois are speckled with farmers combining corn and beans that
will feed the world.

But at the doctor's office, the harvest has been a bit slim. Dawn the
bookkeeper is working to gather money owed us for our spring and summer
work.

The past-due accounts aren't generally the result of our farmer friends.
Instead, it's the Medicaid program run by the state of Illinois that
is more than four months behind in settling the accounts -- totaling
$26,000 at one point. This amount covers seven deliveries, about 200
office visits and four months of hospital work.

In my rural area, 25% of my practice involves low-income pregnant women,
poor children and foster kids on public aid. They're the kind of people
you feel bad about turning away when you're the only doctor in town.

I have a nice, expensive computer system to send the claims out daily in
electronic form. The state will confirm that an accurate "clean" claim
is valid in about a week. But it could be weeks later before we receive
a check. Toward the last quarter of the state's fiscal year ending in
June, the collections process can drag out for months as the state helps
itself to an interest-free loan from doctors, hospitals, nursing homes
and pharmacies.

Many doctors understandably don't take patients on public assistance, or
they limit public-aid patients to no more than 5% of their practices.

At the Republican National Convention, President Bush said every rural
county in the nation should have a rural health center. Senator John
Kerry's health proposal has provisions for adding more eligible people
to the Medicaid rolls. Half my patients are either on Medicare or
Medicaid. From the family-doctor perspective, I've got "government
health care" in half my practice and government bureaucracy in all of my
practice.

My office is a federally designated rural health clinic located
in a medically underserved area. In return for added paperwork
and regulations, $5,000 per year in extra accounting expenses and
intermittent inspection of my premises, the government pays me at a
modestly higher Medicare and Medicaid rate.

If my office wasn't involved in this special government program, the
government would pay me less for practicing in a rural area than in the
city for the same services. My first two years in practice, they paid at
a lower rate because I was new.

I have a certified medical-insurance specialist on staff with six years
experience who works overtime to keep my financial house in order. I had
no financial training in medical school. I'm self-educated in business,
for good or bad.

It takes quite a bit of effort to bill the government for a medical
claim. Each Illinois Medicaid patient has a multiple-digit number on a
special state eligibility document that's issued monthly.

The patient's number goes on a claim form that has 38 individual
sections. Some of the sections have multiple subparts. Essentially,
every disease process has a special five-digit code assigned to it by
a consortium of government, insurance and medical entities. The code
for whatever the patient came in with that day has to be looked up and
recorded on the claim form in the right spot.

Every medication, test or treatment has its own number, too, and also
must be recorded. There are separate reference books and computer
software for all of it.

Unfortunately, many of the codes change yearly.

If the illness and the test number don't match up, the claim is
rejected. If you use an outdated code for the same illness, test or
medication, the claim is rejected. If the state isn't ready on time to
accept the new codes, the claim is rejected. If anything is amiss, the
claim is rejected.

The privacy laws in the Health Insurance Portability and Accountability
Act of 1996 necessitated changes in the claim forms, giving rise to yet
another reason for the claims to be rejected. The old code for a rural
health clinic office visit, W8410, wasn't good enough anymore. They
wanted T1015 on Section 24c of form DPA 2360 instead.

We did as instructed by the state this year and used the new codes.
Turns out, they weren't ready to implement some of the new codes after
all.

Instead of just being rejected, this past spring $11,000 of claims for
office work were marked paid at a rate of $0.00.

Dawn was shocked. I was angry. If we tried to rebill the claims using
the old numbers, they would reject them as duplicate claims.

With payroll hanging in the balance, we called the Medicaid department.
The claims would have to be "adjusted," they said. The adjustment
process required manually entering and typing a different 37-space form
for each of the 181 outstanding claims and submitting them to a separate
department.

Dawn learned from someone in the Medicaid department this summer that
the actual human being adjusting the claims was 11 months behind and was
working on last year's adjustments.

Dawn called our state senator for help. His office was kind. We got a
call from someone at the Medicaid department seemingly interested in the
particulars of our situation. It was a relief just to get to beg for
some mercy.

Thanks to my helpful legislator, $9,000 of bills were processed and paid
late last month. Now Illinois Medicaid only owes me $17,000 in back
pay over 90 days. The doors are open and the lights are on for another
month. Hurray.

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