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Avoiding the Common Pitfalls: What’s So Difficult About Mental Health Billing Payments and Adjustment Codes?

5 Minute Read

Billing Common Pitfalls

Mental health billing can be complicated and extremely frustrating, but it does not have to be. That is why having a dedicated, scalable billing platform is so important for care providers in the fields of mental health and substance abuse recovery. If constant billing issues keep cropping up, it is very likely that the billing platform you are using simply cannot meet your practice’s needs.

Let us see why mental health billing payments and adjustment codes can be so challenging to track.

Mental Health Billing: Many Moving Parts

When submitting billing, office staff members need to ensure that all proper codes and documentation are in place, including those involved in the patient’s specific treatment. On the service end, you have to include CPT codes to prevent claims from being rejected or bounced back to you unpaid. All of this comes in addition to actual services that your office or clinic is providing on a day-to-day basis.

Care providers in mental health and recovery generally have less uniformity in billing than traditional medical providers. For instance, a general practitioner may use the same standardized tests, protocols and services when the bulk of patients seen are coming through the door for routine physicals. The same goes for specialists who perform very targeted diagnostic tests related to one body system or illness on all patients. By contrast, a provider specializing in mental health deals with a broader variety of procedures.

Many other factors make billing for mental health challenging. First, there are many different approaches to therapy. Insurance providers also vary in what they consider “mainstream” enough to cover. This is partly due to the stigmatization that still exists around mental health. Even a patient’s willingness to participate in certain treatments can impact billing. As a result, care providers in mental health meet several roadblocks during the planning stage for treatment.

Pre-authorization requirements also create hurdles for mental health billing. Ensuring pre-authorizations are correct before treatment begins is critical to making sure patients are not left with unpaid bills because of initial coding errors. Adding to the stress is the fact that most clinics run on very tight margins. This is especially true of community and not-for-profit clinics and offices that operate in underserved areas.

Another factor that can complicate things is that reimbursement rates can vary based on a provider’s credentials. Fee schedules are often based on the education and certification level of the provider. Providers will need to sift through many different billing codes to find the right one for their credentials. Choosing the incorrect code can result in denials. Practice management systems like ClinicTracker can help avoid denials by automatically applying the correct code based on the provider’s credentials.

Bundled billing is a way to streamline the process. It combines a group of similar services provided by multiple care providers within a specific period. These services are billed together as an “episode of care,” instead of separately. Bundling payments is more cost-effective, efficient, and usually results in higher reimbursement rates for providers.

How Better Billing Can Improve the Entire Practice or Clinic

Unfortunately, incorrectly chosen CPT codes can also chip away at the integrity of your practice over time. Repeated coding mistakes could cause your practice to be flagged for fraudulent practices. It’s also possible that insurance companies can interpret an honest mistake as an intentional strategy for overbilling a patient or payer. It can be tough to prove that you did not intend to commit fraud if someone questions overbilling. It is imperative that your office’s coding needs to be absolutely accurate.

Why Coding Errors and Billing Mistakes Happen

Coding errors and billing mistakes can be common when the agency does not have the tools and resources to protect against them. As anyone who has ever worked in a provider setting knows, these mistakes are rarely malicious or intentional. However, they have overwhelmingly negative consequences for providers, patients, and payers. Here’s a look at the top 10 coding errors and billing mistakes holding practices back today:

  • Incomplete Corrected Claims: Often corrected claims are missing the original claim number and remark codes for reference.
  • Inconsistencies: One of the biggest reasons why bills get bounced back and forth is that payment may be coming in from a different company than the entity being billed. The reasons for this can range from everything from an outdated record to fraud.
  • Differences in Payment: Payment received could be lower than the contracted amount.
  • Incomplete Resubmissions: Remark codes are not being adequately tracked and revisited on denials during the resubmission process.
  • Incorrect Recipients for Remaining Balances: Balances could be submitted to the wrong payer without a way to track or retract.
  • Missing Information for Coordination of Benefits: When handling COB, necessary information regarding the non-primary payer is often left out.
  • Unaddressed Payment Requirements: Applying universal or incorrect requirements when payment requirements differ is common when a system doesn’t allow for custom notes and exceptions.
  • Use of Outdated Codes: Older systems often don’t update to keep up with the constant updates in mental health coding.
  • Default Upcoding: Manually entering a code that allows for more time/higher billing rates because a staff member/therapist isn’t familiar with codes can be a fraud trigger.
  • Incorrect Modifiers: Simply using a modifier to elaborate on services incorrectly can cause a claim to be rejected.

These are the most common errors that can create billing bottlenecks and rejected claims from a technical perspective. Your office might also increase the chances of claim rejections or audits because of how billers code some services. For instance, many clinics run into claim-acceptance issues when allowing a single patient to see multiple therapists within the same facility. On the payer end, there may not be justification for essentially “paying double” for a single client.

From a care-planning perspective, it may be necessary to help clients find ways to align the benefits they are getting from seeing multiple therapists into a more cohesive plan that only involves one therapist. If a client prefers to continue with seeing multiple therapists, very tidy billing is necessary because you are already in the “red flag” zone for payers. Each therapist should be diligent about accurately billing only for the services they provide on the specific dates that they are seeing clients.

It is also essential to ensure that staff members are not caught in a cycle of overusing specific codes. A staff member who does not have the resources to narrow down appropriate codes that can be applied may fall into the trap of using the same code for almost every patient. It is vital for facility-wide education regarding the use of proper, specific codes. Therapists and care providers must also do the work of finding codes that are as particular as possible when creating a formal diagnosis for each patient. Otherwise practices will undoubtedly have to deal with denied claims, delayed claims, and overlooked services.

Bring Better Accountability and Accuracy to Mental Health Billing

When updating billing practices, it is recommended that behavioral health practices take measures to identify revenue streams, examine allocations, create project budgets, track funds and manage payables using an integrated accounting platform. This is especially important for practices that are trying to serve new clients and expanding client-retention initiatives. Our accounting system uses your own data to help you define and reach objectives using a cloud-base system that pulls from your newly integrated revenue management platform. This means you can base projections on the actual numbers coming through your practice instead of having to guess based annual revenue and expenditures. This approach will allow you to be predictive and not reactionary regarding your practice’s revenue management.

There are many aspects to focus on in relation to coding and billing and it can seem daunting; however, billing tools can efficiently manage it all while making your practice more profitable, accountable, and efficient.

If you are looking to streamline your billing using an automated revenue-management platform backed by human expertise, ClinicTracker can help. Our automated, smart BillingTracker system combined with world-class EHR management can drastically streamline how you run your practice.

Want to see how your billing woes could be eased? We would love to learn more about your practice and see how Clinictracker can help your practice be even more profitable. Reach out for a demo.