Don't Be Distracted by the Shiny Objects of EMR and HITECH Incentives

One of the blogs that I like to read, The Healthcare IT Guy, posted some good thoughts last week about the final MU rules for EMR and what physicians should do next. I liked his advice, which included:

• "Don't be in a hurry to make an EMR/EHR decision because of incentive payments; even if you start in 2012 you'll be eligible for full payments from Medicare ($44k over 5 years) and you can start as late as 2016 to get full payments from Medicaid ($66k+ over 5 years). If you're making EHR/EMR decisions based on other business benefits and not incentive payments then you should continue that research and decision-making process."
• "Do be in a hurry to use technology that helps with office automation first (like document management, patient relationship management, etc.). General office automation technology won't qualify you for incentive payments but it will help reduce your costs and you'll run your business better. If you use the proper technology you save more in one year than you'll get back from incentive payments in 5 years."

His second point is especially important, from my point of view. Too often, we are entranced by the latest idea to generate revenue or build business, and we're distracted from the tried and true techniques for maximizing revenue we've already brought in the door.
A doctor I know has a good expression for it: "Stepping over dollars to pick up pennies."
A good example of this is that $44,000 incentive, which every EMR company is waving in your face. The $44,000 is a tantalizing figure, no doubt about it. But did you realize that you could earn a great deal more than that through improved medical billing and collections?
Let's start with the fact that it's not uncommon for medical practices to report a gross collection rate of 60 percent or less, according to The Physician Billing Process: 12 Potholes to Avoid in the Road to Getting Paid. That means for every $1 of services billed, the physician receives only 60 cents.
Then, consider the impact of denials: Gross charges denied by payers have grown over the last decade to 14-18% of all charges. That translates to $118,800 of lost revenue for the typical primary care physician. Some other food for thought:

• Denied, rejected, resubmitted and underpaid claims can cost you as much as $100,000 per month according to the AMA.
• Your practice could be losing more than $75,000 per year in denied claims that are never resubmitted, based on multiple studies confirming that many practices do not resubmit up to 50% of their denied claims.
• Underpayment of approved claims has historically been as much as 35% lower than the contract amount.

What all of this means is that you could be bringing more money to your bottom line-without adding a single new patient or working another hour longer-or chasing the EMR incentive. Naturally, we believe the best way to do this is by fully utilizing the best possible medical billing software and insurance claims processing best practices to insure that your claims are clean, your appeals submitted and collections are as high as possible. And if you do those things, you will not only put more in your pocket than you will with the HITECH incentives, but you will have a better-run practice overall, as The Healthcare IT Guy mentioned.
I'm not saying you should ignore EMRs and other technology. You should certainly seriously consider an EMR for your practice, if it makes sense for your practice.
We just don't want you to be distracted by that shiny object and miss out on money you've already earned-and deserve.

Because we believe you deserve the dollars...as well as the pennies.