Blog, Chirosecure Live Event January 8, 2024

Chiropractic Malpractice Insurance – Your 2024 Fee Schedules

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Hello everyone and greetings for the new year. This is Sam Collins, your coding and billing expert for chiropractic, including ChiroSecure in the HJ Ross Company. We wanna talk this year and start the year talking about what’s going on with fees. Do I raise? How do I raise? Let’s start to get some understanding of 2024 fee schedules, what we need to do to make sure our practice continues to succeed.

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And of course that means success is partly gotta be revenue. And I know sometimes you think, why can’t I talk about money? You better because you are a business. So let’s go to the slides. Let’s talk about fee updates and changes for 2024 for the chiropractic profession. One thing to keep in mind is that fee schedules do update and change.

Some years, not as much as we like or at all, but we gotta think of how do I update? Should I update? When do I update? I think we start with how are your fees valued? What really determines the value of one service to the other? It’s the community and the patient, but ultimately, you wanna start to think of who is setting these fees.

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The first person is you. What do you feel the services worth? I’m not gonna certainly say I’m letting an insurance company dictate this is what it’s worth. There are offices who charge much more than what some insurances allow. Think of it, for those of you that belong to a SH. I bet your cash rate for your treatment is higher than that.

Now, what’s the trade off is? They’re saying, we’ll send you more people, but we’ll pay you less money. So setting the fees comes down to you, but also who you belong to. There’s also something called the relative value units or rvu. If you’ve attended a seminar with me, you’ve seen this and it’s updated for this year, you wanna start to understand how is it overseen?

Every single CPT code, every single one. Has a relative value. So if you could tell me the price of one service based on what that insurance pays for that one service, I can give you an idea or the amount that they will allow based on the relative value from another service. All these are simply comparisons of one service to another.

This is set up and has been done by the federal government well since the eighties, and what they do is they break down each and every code and base the relative value on several factors. The cost of the service generically, but also the cost of the provider of service, the cost of living, adjustments that happen for your cost to run the office, cost of education, cost of supplies.

A little bit of all that’s put in there, and that’s why these vary year to year. Don’t think that if you have one from five years ago, it’s the same today. In addition, though, of course, who’s gonna set those fees? Your contracts. If you belong to an HMO or A PPO, they’re pretty much gonna tell you this is what we allow, like maybe a SH Optum Health, these types.

One thing to keep in mind though, have any of you ever dealt with how to probably get a raise and how to create value so you can, I had an office this year, actually, a few that got as much as a 50% increase from a SH. Why did that happen? They created a value. It’s a way of setting yourself up to make sure they see the value and they value by increasing your rate to keep you in the system.

Keep in mind though also what’s setting fees are deductibles. It doesn’t really set the fee, but it tells you how much is the patient paying before they start. Remember, deductibles often will reset at first of the year, but do keep in mind that’s not always the case because I’ve always thought it was unfair.

What if you got sick in November, December? Pay your deductible, you continue going to the doctor and then in January your deductible starts all over again. You’re like, oh my goodness. There are some things about deductibles that often with most plans they do This services that a person receives in the last quarter of the year, usually October on May roll over to the next year.

So that’s certainly something to look at. ’cause obviously what if someone has a thousand dollars deductible? They start in December. Will that deductible then be applied when it comes to January? Many plans know it may roll over, so that’s something to consider because obviously a patient’s gonna think, oh my God, I’m just paying all this money out of pocket.

So that’s gonna be a difference. Remember, deductibles do update a little bit this year for Medicare. It did up to two 40. It was 2 26 last year it went up $14. It’s been pretty consistent for many years. It’s probably 15 years ago, it was 2 0 5. So you can see here, you can look and go has it increased?

A few percent every year actually has about four to 5% of you think cost of living. You’re about right. What also is determined though, is well, what are the gonna be the copays and co-insurance? Now let’s make sure we understand the difference when it comes to fees. What is a copayment? A copayment is the amount of patient pays that’s fixed.

You belong to this insurance network. With them, they have a $10 copay, let’s say 20. Whatever the case may be, it’s fixed. It’s always the same. Sometimes that copayment though could be. A percentage based upon what services you build. But keep in mind a co-payment is always a fixed amount. It’s gonna be the same.

Whereas a co-insurance is when you’re not in network. Co-pay is an in network. It’s set fixated. Co-insurance is when you’re not in network. And this is something to keep in mind that I’ve had some offices get themselves in trouble because what’s going on is they’re billing out an insurance, $300.

Let’s face it. Are there some plans? Personal engine? Others, they’ll pay you 300 to visit. Of course, we love it. Bill it get paid. But what about a person that you’re not in their network? You bill 300 a visit, and that plan only pays you a hundred dollars. How much does the patient owe? That co-insurance would be 200.

If you bill 300, you collect 300 unless you’re in network and have a write off, and there’s a difference. Write-offs happen because you’re in network or maybe an occasional hardship. But keep in mind when it comes to setting fees. Let’s not let our poor paying insurances set our fee nor our best. Obviously what we prefer to get 300 visits.

Sure. But is that reasonable for all plans? What my goal is always thinking of what would you charge? What would someone patient pay for cash? My insurance fee should be in that range. Yeah, a little above five to 15%. But nonetheless, above the one exception, of course for California providers, there is a provision for out of pocket that’s different.

But for everyone else, five to 15%. But do remember all these things have to come into play. So what’s going on with 2024? Is there really some big changes? nOt really. Let’s talk about it. Medicare fees. You’ll notice if you haven’t already, if you’re in our network, of course contact me, I’ll give you the updates there.

Of course, with work comp, there’s not much of a change. In fact, the change actually was slightly lower and of course that’s frustrating ’cause Medicare fees already are the lowest. wHy do they get lower when everything else is cost more? Thank Congress for that. Obviously there’s a lot of things nationally we deal with from budgets for military to Medicare and all those things.

And what’s an easy one to cut? Payments to doctors. And so they did. That helps for them to balance the budget, which means you’re gonna see on the chiropractic end probably from a few pennies to maybe as much as 50 cents. And I’ve seen some areas as much as a dollar per service. So now is that a big change?

No, but it’s a change nonetheless. Does that mean you should be lowering fees to others? No, I never let Medicare fees necessarily dictate what I charge, because of course I may be lowering. In fact, if you look at Medicare fees today, I. Compared to three years ago. They’re lower. They really are now, not by a ton but lower.

Therefore, I wanna look at it from a standpoint of, okay, how do I make sure to use this now, particularly if you’re in states like Michigan or Florida, their plans there that simply just use 200% of Medicare and just say, here are the Medicare rates. This is the amount, this is what the patient pays.

Bottom line though is we’re not always in those states, but what about states that do have relative values that they convert? I. By example. I haven’t shown you the relative values yet, but by example, if you’re in the state of Texas for workers’ comp, they simply take 64, 83 and then multiply by the relative value.

If you’re in Connecticut, it’s 51 50, I believe in Utah, it’s $52. So there’s a little bit of variation. Keep in mind, for Medicare, it’s 33. Now, let’s talk about this from the standpoint of the relative value. What they’re doing is converting that. It’s a fee comparison. If you have a code that’s worth 0.75.

And another code that says it’s worth one, that simply means that code is worth 25% more. So if I’m billing $75 for a service, that’s 0.75. When I bill for a service worth one, what should be the fee? $100. Pretty straightforward. It’s that easy. When you look at relative values, in fact, you’ll see this reflected in fees most often.

Particular is war comp, Medicare, and others. And you’ll notice if you look at the comparisons of this year. Compared to last year, you’re gonna notice we’ll see ’em. That’s pretty flat. The 9 8 9 4 oh and four one stayed exactly the same, but then four two and four three dropped down by one percentage point.

Does that make a major difference? No. But nonetheless, it gives you this, I look at this and go, wait a minute, if you’ll notice. The fee for 9 8 9 4 oh is 0.82 and 1.18. That means it’s basically 36% higher, or to make it simple, just think a third higher. This is why you’ll notice if you have a fee that’s $50 for 9 8 9 4 0.

I can’t tell you how often I’ve seen someone going, oh yeah, my 9 8 9 4 0 is 50 and my 9 8 9 4 1 is 60, and I go, why? How did you value that? Keep in mind, the average fee for. Chiropractic manipulation from Medicare is between around $30 for a four. Oh what’s the value of 9 8, 9 4, 1. I’m gonna say from 40 to 45.

Now, you may think that still doesn’t seem that much, but keep in mind, let’s just take double the Medicare rate. If the Medicare rate is 30, what’s double that? 60. So what if your regular fee is 60? Notice when I double the rate of 40 to 45, that means it’s 80 to 90. It’s about a third higher. The number one area I find for network members, people attend seminars is not understanding that simple fact and way undervaluing their service.

In other words, if I am billing you $55 for 9, 8, 9 4 1, but I’m willing to pay 70, how much am I gonna pay you? 55, what’s you building? So I want you to start to look at when you’re setting a fee used as a barometer, starting at 9, 8, 9 4, and look at the relative price for other things by example. Have you ever looked at your difference of when you’re billing a 9 9 2 0 3?

A simple mid-level exam, patient’s couple complaints, a little trauma. The value of that service, a nine, or excuse me, 9 9 2 0 3 is roughly four times the value of 9 8 9 4 oh. So I’ve seen this time and time again. Office charges $50 for a four. Oh, okay. Fair. But on the low end of fair, but yet their price for a 9, 8, 9, or excuse me, 9 9 2 0 3 is 90 or a hundred dollars.

I’m going, huh? You have a code that’s worth four times the amount that you’re charging. 50% above. How did you come up with that? Most offices I didn’t know. Now, I’m not against you determining the fee the way you want it, but you may wanna start to look at the value. Much if you own a house. When you go to sell it, do you just think, Hey, I paid X, Y, Z for it.

I’m gonna charge a little more. Or do you look at the neighborhood and determine, oh my God, the houses are selling for a million and a half, even though I paid 400,000, I’m gonna sell my house for a million and a half. ’cause that’s what it’s worth. So start to think of when you’re looking at fees for this year, let’s look at also the relative prices, but what price increases am I doing?

If you’re not increasing a percent or two a year, you’re losing. Remember your cost of living changes every year. Heck, it changes month to month for some of us. If you ever raise your rates in a while, how are you making more money? Are you just saying the only way my practice can do better is I have to see more people?

Nothing wrong with that, but I think for the most part, I found offices that I consult with directly, network members, especially I. They’ve undervalued, and you can simply increase your revenue by just by understanding the actual value of a service. By example. Medicare sets these fees and who follows ’em?

Everyone in the sense of the percentages. Some states just use a percentage of Medicare, so start to look there and thinking, oh my God, I’ve way undervalued. I can’t tell you how many times I find that. In fact, I find it 90% of the time. So I want you thinking of how do I value a service? What is usual, customary for my area?

Realize usual, customary is not always what you think, because what if you have people that are undervaluing the service in your area? I. Does that make it usual and customary? Not really. It just means you’ve got some people that do it. There’s an area in San Diego that’s one of the most expensive areas to live in the state, if not to mention the country.

Lovely, beautiful area. Do you know the relative value in that area? It’s not any different any place else, but I find it has a lower value for usual and customary because there’s a lot of quote unquote low cost chiropractors there. Who charged 25 a visit. So it lowers everyone’s prices. It’s like the person who doesn’t keep their house up makes the whole neighborhood go down a little bit.

Kind of the same idea. So be careful of just comparing your friends. Look at the real value and remember what is fair, what is, what would I pay? What is the value of the service they’re given? I have some offices that do all cash, that charge a lot. It’s not for everyone, but do they have people come in?

Yeah. ’cause they get a really good service. I’ve never once picked a doctor, ’cause it was cheaper. Now it’s not to say I wouldn’t wanna be reasonable, but I wanna go where I’m getting good care. So you gotta think of, am I doing the 99 cents store of chiropractic or am I doing a good value of service? By the way, there’s nothing wrong with a 99 cents store, but how does that work?

It’s volume. And keep in mind when it comes to setting a fee. Can you have a dual fee? Now, I mentioned California a little bit different, but every place else, no. Your fee’s, your fee. Again, can you have a small difference for pay a time of service? Five to 15% sure, but not anything significant. Keep in mind where people get confused, could you have multiple fees based on contracts like your Medicare rate, your work comp rate, your Blue Cross rate?

Sure those are separate because they’re contract outside of not contracting. Remember, the patients pay the difference, so be careful. I. When you have a person you’re not contracted with and there’s a balance due or not paid by the insurance, they have to pay that amount. . We cannot simply write it off.

That’s considered fraud or inducement or giving the patient a gift. We can’t give patients gifts. So bottom line is start to really think of a fee. That’s what we do with our services, with the network, with our seminars. If you haven’t been familiar, get to the one first year. Let’s go through all the RVs.

Let’s understand how to value. What is your fee schedule for your state. Many of you go, oh, I don’t know. That’s what we do to help you, but how do you raise it? What do I do? Some of that’s gonna be based on patients. Should you inform them rates are going up. Sure. If you tell your patient, I’m raising my rates $20, most will go, wow.

But what if you haven’t raised your rates in 25 years? Trust me, some kairos haven’t. $20 raise is not much. Can you imagine if you said, I’m gonna sell my house for the same price I bought it 20 years ago. Would you do that? I bet your house prices at least doubled. So with patients, not to get them thrown off, you should be raising rates slightly every year.

If you were to raise your rates $2 a year, after 10 years, it’s 20 more. For many of you, that wouldn’t be that big a deal, and that’s reasonable. People understand costs. If you’re not passing on, you’re absorbing it by example. What if you have credit card fees? What have you done to offset that? Obviously we can’t charge extra money percentage, but could you charge a service fee?

Something to consider. You also have to consider though insurance, not just patients. What do insurances allow? Now, that’s not gonna be the end all be all, but it’s gotta come into the equation as to whether or not what is actually being paid or allowed. And this is why some people get out of insurance going, I’m not gonna belong to the A SH ’cause it’s too low.

I don’t disagree with that because at some point you can only do so much volume in a day. Yes, I know some chiropractors can see 150 people in a day. Many cannot. So remember the insurance, these insurance contracts all help to set up what’s gonna be fair and reasonable. And I’m not against the contracts.

Just be careful of undervaluing what you do. That’s what we do. Get to a seminar, join the network. Really understand. How do I honestly set a fee? It’s one of the things I mandate to network members to do. You should mandate to yourself, how do I change my practice to make sure I’m getting a good, fair fee?

Not overcharging, but also not undercharging. I wish you very well for 2024 set up to have a good intention for what’s going to change for you and to help your patients at the same time, but your business has to stay open. Your rent didn’t decrease, I’m pretty sure. Take care everyone. Until next time. .

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