Fair Billing Practices

Fair Billing and Collection:  My Promise to My Patients, and Their Responsibility

We practice in a climate of high-deductible, low quality healthcare insurance.  Decisions that we make when billing patients can have significant, and sometimes devastating, financial impact on our patients. I have been an eyelid surgeon for the past 9 years in several different practice models (from an academic center to a boutique plastic surgery practice to my current practice), and I have developed strong beliefs on how to fairly manage the financial transactions that go hand-in-hand with medical and surgical services.  

There are several facets of eyelid surgery that make it different from many other types of surgeries, from a billing persepctive.  Eyelid surgery is somewhat unique in that it often requires numerous billing codes, since multiple eyelids are operated on at the same time during the same surgical setting.  Eyelid surgery is also unique because the distinction between what is medical and what is cosmetic is sometimes blurred.  This leads to some challenges in billing and collection.  It also leads to burdensome audits from insurers and from the Centers of Medicare and Medicaid, to insure that cosmetic surgery is not being billed inappropriately to insurers.

As a surgeon, I strive to maintain ethical standards and develop a trust with my patients that is inviolate.  I will develop a surgical plan and carry it out on my patients in the same manner that I would for a close friend or family member.  I will expect to get compensated for my services, but in a manner that is fair and not exploitative.  Below, I will describe the billing practices that I will avoid because I believe they are unfair to patients.  I will also discuss some expectations that I have from my patients.

Finally, I have a belief that 90% of all surgeons make ethical billing and patient care decisions.  I am highlighting outlying scenarios that I think adversely affect patient finances and outcomes.


Billing Practices that I Choose to Avoid:

1. Upcoding.  

I will code the procedures that I perform fairly when I submit them to insurance.  

Some surgical codes reimburse more than others, and the codes that pay more can be chosen. Here is a real world example:  Occasionally surgeons are called upon to review charts from other surgeons as a quality control measure in surgical centers.  Several years ago I reviewed an operative report that sounded quite invasive.  Numerous high-paying codes.  However, when I read the text of the operative report and sifted through what was actually done, it was truly a case that I often do in the office in 5 minutes during initial office consultation.  Medicare would have paid me $105.51 for the procedure, and more than likely even less than that if done during the initial office setting.  The surgeon who upcoded would have expected to collect about $2031.67. The codes chosen in the surgical center literally paid twenty times as much as the codes that were appropriate.  

2. Refusal to do bilateral cases in the same surgical setting.

The way insurance works, it is in the surgeon’s financial interest to do fewer procedures in the same surgical setting.  Example:  Let’s say the surgeon does surgery on the right side and the same surgery on the let side.  Insurance pays 50% for the second side.  If there is a third procedure or fourth procedure, insurance only pays 25% for each of those.  Consequently, if a surgeon does one surgery on the right and the same surgery on the left, he gets paid 33% more if he splits them up over two separate days.  I have heard of surgeons who do surgery on one eyelid one day, and the other side the next day!  I’ve heard of surgeons that only do tear drain surgery on one side at a time, even if the patient has bilateral disease.  This is a problem for some patients, because they are often older, and it is hard to justify unnecessarily placing these patients under general anesthesia twice when it could all be done at once.

I will not unnecessarily split up procedures solely to increase collections.  I will, however, split up surgeries if medically indicated, as follows:  I will not perform surgery on right and left side at the same time if it requires both eyes to be sewn closed postoperatively (since the patient won’t be able to function for a week!), and I will split procedures up if I think doing so will make the long-term outcome more predictable or increase the overall rate of success of the procedures.

3. “Sharing” surgeries in a gratuitous manner.

There are times when leveraging the expertise of another surgeon in a sister field is critical to achieving the best outcome for the patient.  However, there are times when it merely increases billing and collections.

A few years ago, I was contacted by an ENT who wanted to work with me to do tear drain reconstructions together.  There are times when these sort of arrangements make a great deal of sense, in terms of efficiency.  I could see this benefitting patients if both surgeons had a high volume of these cases, ran multiple surgical rooms, and could leverage each others skills for high quality, efficient outcomes. However, this sort of arrangement makes NO financial sense for low volume surgeons unless there is fraudulent billing involved.  The reason is that the only sensible billing code to use for the ophthalmologist to use pays next to nothing, so why would the surgeon participate in this, unless the billing was creative?  Finally, I find that patients who are involved in this sort of care somehow always end up having numerous sinus and lacrimal problems that need to be corrected.  I am skeptical that these problems truly exist, instead being conveniently documented for billing purposes.

4. Performing unnecessary surgery.

I will not perform unnecessary surgery.  Here is an example from my own practice:  I work with specially-trained dermatologists who remove skin cancers completely by checking the pathology results layer by layer during the excision, the “Mohs” technique.  Once the tumor is cleared, they send the patients back to me the following day for the reconstruction.  I utilize this partnership almost exclusively, because this technique results in better cure rates and smaller defects after cancer removal.  Occasionally, patients with seemingly small cancers return to me with very large defects that need reconstruction, because the tumors extend beyond the clinically-apparent borders.  On the flip side, sometimes patients return to me with tiny little defects, defects that likely would heal just fine if left alone.  Several times per year, I meet these patients in the surgical center the day after the cancer is removed, and I decide to cancel my surgery.  I have basically just torn up a check for $1000 at that point, because every insurer is going to pay for cancer reconstruction.  However, when you strip away the veneer, this would be no different than cutting someone purely for one’s own benefit.  And I will not do that.

5. Maximizing profit by only performing surgery outside of the global postoperative period.

Most major surgeries have a 90 day “global period”.  That means that all care related to the underlying disorder, within 90 days of the surgery, is not billable.  It is possible to bill more if a follow-up surgery is spaced out 91 days from a preceding procedure.  I will do this under limited conditions, for example, when the healing period of the primary surgery justifies waiting 90 days for a secondary surgery, or if the patient understands that their initial procedure is exceedingly complex, or if we discussed preoperatively that the initial surgery carries a high reoperation rate.

I try to schedule postoperative office visits within the 90 day global period so that patients do not get billed again after their surgery.  For this reason, my standard upper lid postoperative visits occur at 1 week and 2 months after surgery. If for some reason the visit falls beyond the 90 day period, I absolutely do bill patients for those visits.  In fact, I have to: Medicare requires that I bill all patients the same.

6. Making tons of money on revisions.

The most common surgery that I perform is upper lid ptosis repair.  This procedure involves lifting the lids so that patients can see better.  There is about a 10% revision rate with this surgery, and try as it might, that’s about what it is.  I don’t charge patients for those revisions, even if it is outside the global period.  These patients can almost always have their revisions in the office, so that they do not occur additional facility expenses as well.

Here is a scenario that troubles me:  Imagine that a surgeon performs a cosmetic surgery and it doesn’t go well.  Let’s say this patient needs multiple revisions.  The surgeon, if he or she owns their own surgical center, can book that surgery 91 days after the original and bill insurance.  They can tell the patient “I am going to work with you, I will only take what insurance pays.”  This may sound like a very generous thing to do, but in reality, it is a cash cow.  The surgeon collects money on the facility side from insurance, and collects whatever the insurance pays, and does this for each revisional surgery.  In essence, this surgeon has gotten paid to create a surgical problem initially, then bills insurance numerous times to try to fix it.

Every surgeon has revisions.  I certainly do as well.  It is unusual that my revision would require sedation, and therefore, it is unusual that it could not be completed in the office at no charge.  Perhaps 2-3 times per year I have a patient that needs sedation for a revision.  If the case is cosmetic, I don’t charge them, and I cover the facility expense myself.  If the case is insurance initially, I do believe it is appropriate to bill their insurance for revision requiring sedation, at least for the facility expense.  I generally do not bill for my own surgery in those instances. 

7. Spreading out care over multiple visits when it could be done immediately.

Typically, I take care of minor procedures whenever feasible during the initial office visit.  There are several reasons for this:  1) patients often drive great distances to see me, and 2) the procedures often take 5 minutes at the most.  Exceptions to this are when I am exceedingly pressed for time during the clinic session, or when the scope of the procedure requires longer time or cautery requirements that are best available in my surgical treatment room.  

Lets look at the economics of this decision.  If a surgeon schedules a procedure that costs $250, they collect the full amount if done on separate visits, but only 75% of the amount if done during the initial office visit.  Thus, surgeons have financial incentive to spread care out over numerous visits.

8. Scheduling surgery in a surgical center for minor procedures that could be done in the office setting during the initial visit.

In some ways, this is not a fair comparision, since I do not get any significant profits from any surgical center.  However, here is a scenario that I have seen in my office.  A patient comes to me with some bumps on his eyelid and I say, “Sure, I can cut those off”.  And he groans and says it has been done three times before, and each time required general anesthesia.  At which point my jaw drops.  Cutting them office took 5 minutes, and was done during my office consultation.  So what happened to him previously?  He went to a surgeon who owned his own surgical center.  This surgeon billed the patient 25% more than I did for the service, but the facility (which he owned) quite likely billed him and his insurance thousands of dollars.  I will not do this to patients.


The Other Side of the Coin: Expectations that I Have from Patients:

I draw a hard line between cosmetic and functional whenever possible. Because of the prevalence of cosmetic eyelid procedures performed in the United States, I am not infrequently audited by insurers, including the federal government, to make sure that I am not billing them for anything cosmetic. My last audit was April 2017, and I am happy to report that I could easily defend all of my surgical decision-making, and none of my surgeries for Medicare were denied retroactively. And none of my patients are going to get a surprise bill in the mail.  I tell it to patients like this: “I do a lot of surgery, and Medicare is definitely going to audit me. That is why I cannot do your surgery and submit it to Medicare if I don’t think it is covered. You might be able to go out and find someone who does less surgery, and therefore is less likely to be audited. That person might just do your surgery and bill Medicare for it.  And it might work out for you. But, then again, you will be going to someone who doesn’t do a lot of surgery. Your choice.”

I will absolutely bill patients for services if the claim gets denied. Of course, I will go through formal appeals processes to the full extent possible, prior to sending a bill to patients. For patients with commercial insurance that are “borderline”, I submit them for prior authorization by the insurance company. A few times a year, the “prior authorized” cases get denied after surgery. Yes, you read that right. In these instances, I absolutely do bill those patients with whom I have had an up-front discussion about their financial risk prior to undergoing surgery.

I make all patients who are undergoing eyelid surgery sign an “advanced beneficiary notice”, or “ABN.”  This states how much I am going to bill them if their insurance denies their claim.  This is important, because Medicare does not “prior authorize” procedures: they rely on me to verify that the patient’s condition meets their local criteria for care.  (This is why going to a plastic surgeon, versus an oculoplastic surgeon, for an insurance blepharoplasty, is a dicey proposition — they are less capable of making this assessment.) 

I will do my best to prevent any financial surprises for patients.  But occasionally patients are disappointed with their insurance company, or with Medicare.  I cannot control that.