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Audit Spotlight
Cynthia Swanson
Cynthia Swanson
RN, CPC, CEMC, CHC, CPMA, Senior Audit Manager

Background

ClaimDOC' s comprehensive line-by-line auditing uncovers errors that basic repricing and auto-adjudication does not catch, leading to greater savings to health plans and beneficiaries. Our audit team analyzes all types of healthcare claims for a variety of potential concerns including excessive usual and customary charges, duplication of claims, correct coding edits, unbundling of services, and others. Our claims review is not intended to impact care decisions or medical practice.


Case Scenario

Member was admitted to the hospital for elective spinal correction surgery, resulting in a four-day hospital stay. The hospital claim and charges submitted to insurance totaled $321,691.21. The primary diagnosis reported on the claim was degeneration of thoracic spine.

In this case, high dollar charges included Revenue Code 360 - Operating Room for $223,417.00, Revenue Code 270 - Medical/Surgical Supplies for $58,833.25 and Revenue Codes 111, 202 and 314 Room and Board for $21,672.00. Our review of the hospital itemized bill identified unbundled services considered to be part/partial to other reported services reported and billed. Examples included charges for respiratory services, medical/surgical supplies, laboratory services, monitoring services, and pulmonary services.

Additionally, we noted charges for operating room (OR) services to be $22,692.00 for the first 30 minutes and charges of $196,200.00 for each additional minute (600 minutes) or $327.00 per minute. While it is common for hospitals to “load” or have a higher charge for the first 30 minutes of OR time due to a base/initial OR facility set-up charge, each additional minute or units of 15 minutes (depending on the methodology of charge structure the hospital creates) is lower. The OR charge of $327.00 per minute is egregious when we analyze and compare each additional OR minute charge reported/billed by other hospitals.

For example, we commonly see hospitals billing each additional OR per minute charge in the range of $55.00 to $135.00. We understand the OR additional time per minute or units of 15 minutes varies and may be dependent on numerous variables, i.e., direct costs, wages, benefits, surgical supplies, and other factors. Additional and other surgery charges such as anesthesia services and physician charges are separately reported and billed.

The claim was priced based on the hospital’s cost-to-charge allowances for each Revenue Code reported/billed minus the identified unbundled services which resulted in higher pricing than Medicare’s Diagnosis Related Group (DRG) 458 of $41,407.51.

Below is an overview of the hospital charges billed and related ClaimDOC pricing and savings:

Total billed charges: $321,691.21

ClaimDOC Allowed: $74,829.98

Plan Savings: $246,861.23

Percentage of Savings: 77%


The Takeaway

Unbundling of hospital services considered part and partial to other reported/billed services and over-inflated charges were observed on the itemized bill. While hospitals may charge any amount they choose for provided services, egregious fees and billing unbundled services can complicate matters for members to understand their bills and payments, impact the collection of patient balances, build a reputation of hospitals charging high fees, create burdens for patients having no insurance and a host of others.

Our goal at ClaimDOC is to use benchmark charges and costs nationally to negotiate fair and ethical payments. Employers turn to us to seeking to establish fair reimbursement rates for their plans allowing them to save money and provide richer benefits to their employees. A win-win for everyone.

Client Savings

Comprehensive line-by-line claim auditing by healthcare professionals is used to uncover errors typically not caught. See the savings below and know that together we can make healthcare affordable.

1. Cleveland, OH

Six-day hospital stay for treatment of convulsions

High-Dollar Services:
  • EEGs $53,444.00
  • ICU room and board $20,376.00

Savings Summary:

Billed Charges: $79,365.15
ClaimDOC Allowed: $9,813.01
Plan Savings: $69,552.14
Reduction: 88%



2. Fairfield, CA

Three-day hospital stay for delivery of newborn by c-section

High-Dollar Services:
  • Operating Room $41,996.41
  • Room and Board $17,711.88
  • Pharmacy $13,633.30
Savings Summary:

Billed Charges: $96,684.88
ClaimDOC Allowed: $12,064.66
Plan Savings: $84,620.22
Reduction: 87%



3. Salem, VA

Two-day hospital stay for gallbladder surgery due to gallstones

High-Dollar Services:
  • Operating Room $45,129.00
  • Medical/Surgical Supplies $29,573.00
Savings Summary:

Billed Charges: $115,913.50
ClaimDOC Allowed: $18,591.85
Plan Savings: $97,321.65
Reduction: 84%



4. Victoria, TX

Nine-day hospital stay for treatment of heart attack and pneumonia

High-Dollar Services:
  • Cardiac Cath Lab $57,018.00
  • Pharmacy $30,543.90
  • Respiratory Services $27,609.00
  • Room and Board ICU/CCU $13,390.00
Savings Summary:

Billed Charges: $152,189.40
ClaimDOC Allowed: $38,556.26
Plan Savings: $113,633.14
Reduction: 75%



5. Fort Meyers, FL

Four-day hospital stay for treatment of heart attack

High-Dollar Services:
  • Cath Lab $22,233.50
  • ICU/CCU $12,266.00
  • Medical/Surgical Supplies $7,757.45
  • CT scan $7,233.00
Savings Summary:

Billed Charges: $92,915.80
ClaimDOC Allowed: $25,031.95
Plan Savings: $67,883.85
Reduction: 73%



Disclaimer – The analysis of any medical billing or coding is dependent on numerous facts, regulations, payer policies and codes, as well as the controlling plan description. The information contained herein is intended to provide a real-life example of opportunities for savings through ClaimDOC services but is not intended to provide medical, legal, or financial advice.

Member Experience

Feedback from a Member

I was very unruly and frustrated at the beginning of our call. Emmanuel took his time to make sure he explained everything to me, so I could understand each claim and what it was for. I'm new to this insurance and I will enjoy it, even more, knowing ClaimDOC has member advocates like Emmanuel available to help. I work in customer service so shame on me for being a horrible customer, but thank you Emmanual for being so nice and helpful.

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