Does Your Overhead Impact Your Fees?
Evaluate Your Fees
Recently, I spoke at a convention about the importance of evaluating your fees on an annual basis. Of the 200 attendees, only 2 had evaluated their fees in the last 5 years. Each time I get to this section of my presentation, I am always asked, “How do I know what I should be charging?” My presentation is really about establishing a fee system and not what each clinic should be charging in their practices, but the response when I give it is fairly common.
During this discussion, one of the providers stated that he was just going to lower his fees and get out of the insurance game because his MCO/PPO agreements and Medicare did not pay him enough. This, of course, got the attention of everyone in the room. When I asked him if he knew his cost of doing business, he stated that it is $30 per visit. I asked him who his best payer is, and he said BCBS pays him $40. My next question was what he charges his cash patients for this same service covered by BCBS. He said it is $25. I asked him if he valued the services he provided in his office. Naturally, he said, “Yes!” with a lot of conviction and maybe a little bit of attitude.
I am sure that many people were wondering why I was “Poking the Bear” with this discussion and did not just move on in my presentation, but his example led to the “Aha” moment of the day. I simply asked the audience if they felt that their MCO/PPO agreements paid them fairly for the services they provided. They did not. I then pointed out that most providers feel the same way, but when they accept less from their cash patients than what insurance is willing to pay, it appears providers do not value the services they provide. How does our profession expect to be paid more, when we are willing to accept less? The question to ask yourself is: if you have a payer that is paying you below what the service is worth, and less than the cost to you for rendering the service, what sense does it make for you voluntarily charge even less?
A few days later, one of the attendees called me to say that she didn’t sleep much the night of my presentation. She walked into her office early on Monday to pull reports. What she found was that she had been lowering her fees to cater to her smallest demographic. She had been losing thousands in workers’ comp claims because of how low her actual fees were. She joined ChiroHealthUSA that day to help those patients in her practice who had limited or no chiropractic benefits to help them maintain access to affordable care. Then, she raised her fees for the first time in a decade.
No one will value the care provided in your office more than you. Take the time today to determine your cost of doing business, review published fee schedules in your state, knock the dust off those MCO/PPO agreements, and get a clear idea of how much you value the services you provide in your practice. Remember that ChiroHealthUSA is a great way to maintain the UCR fees for your services while keeping care affordable for your patients who have high deductibles and limited or no insurance benefits. If you need help in determining your cost of doing business, click here to download our Practice Overhead Calculation Worksheet.
About the Author
Dr. Ray Foxworth is a certified Medical Compliance Specialist and President of ChiroHealthUSA. A practicing Chiropractor, he remains “in the trenches” facing challenges with billing, coding, documentation, and compliance. He has served as president of the Mississippi Chiropractic Association, former Staff Chiropractor at the G.V. Sonny Montgomery VA Medical Center and is a Fellow of the International College of Chiropractic. You can contact Dr. Foxworth at 1-888-719-9990, email@example.com or visit the ChiroHealthUSA website at www.chirohealthusa.com.