Mental Health Billing Services: The Essential Guide
How mental health providers can optimize billing
Establish systems to get reimbursed in full, on time, every time
For any healthcare provider, managing the revenue cycle can be a daunting task. Medical billing and revenue cycle management is a complex process with many moving parts. Furthermore, despite the central role of billing and RCM in any practice, most physicians have little training in billing, coding, or other aspects of revenue cycle management.
Billing and RCM for mental health providers is significantly more complex than most other specialties. There are many details which are specific to the specialty, and attention to these details can have a major effect on your practice’s bottom line. Both providers and their their billing teams must be deeply familiar with these specifics, especially since insurance policies and regulations change all the time.
The purpose of this article guide you through the essentials of billing and RCM for mental health providers, providing you with the key knowledge and insights to help you better manage your practice's revenue cycle, so that you can save time, reduce your workload, and increase your revenue.
Let’s get started.
Remember: Your Practice is a Business
To begin, it’s essential to adopt the appropriate business mindset when it comes to your practice. Certainly your primary focus is on providing high-quality therapy for your patients, but it's also crucial to be aware the value of your expertise and the services you offer. Unfortunately, most mental health providers don’t fully understand the business side of medicine, and their practice suffers as a result.
Once you view your practice as a business, you can take steps to ensure that you are being compensated fairly for your time and effort. Remember, you are a highly skilled practitioner, and while your work has undeniable humanitarian value, it’s important that you are paid fairly for your services. This mindset is absolutely essential when you’re negotiating contracts, billing for services, or interacting with insurance companies in any way. Failure to do so will put you at a major disadvantage.
Recognizing the importance of the business side of your practice will help you to ensure your practice is a successful and sustainable business, which in turn will allow you to provide the best possible care to your patients.
Understand How Billing Works for Podiatrists
Once you have the necessary business mindset, the next step is to gain a full understanding of exactly how billing works in podiatry. Again, the general billing process for allergists is actually quite similar to most other medical specialties:
Receive and document the referral from the patient’s primary care provider
Document patient information, including insurance details and demographic information
Conduct the initial appointment and evaluation
Assess the medical necessity of the proposed course of treatment, if any
Document the initial visit in the patient’s EHR, including clear demonstration of medical necessity of the patient’s course of treatment
Submit insurance claims for initial visit
Obtain prior authorization for further care and follow-up visits
Provide further care and follow-up visits
Submit claims for follow-up visits and care as needed
The above is a best-case scenario. If all of the above steps were fulfilled within each payer’s guidelines and in a timely manner, and if each payer processed each payment properly, you would simply have to wait for payments.
Certainly, your focus should be to submit claims that are both accurately coded and perfectly documented, so that you will be paid the first time. While mistakes may happen, this should remain your goal.
Study Billing Guidelines Thoroughly
In order to bill accurately, it is imperative for each physician to become thoroughly familiar with all aspects of documentation and coding for a mental health practice.
Remember: the entire billing process hinges on your understanding of billing guidelines and regulations. If you submit the correct billing codes and maintain good clinical notes, your billing department or billing service will be much more efficient and effective.
There are essentially two categories of resources you’ll need to have available:
Official CMS guidelines and policies, CPT and ICD-10 codes, and payer-specific policies
Secondary resources designed to distill information from official sources and make it more accessible
It’s important to have access to official sources for easy reference. Certainly you’ll need to be thoroughly familiar with CPT codes used in mental health as well as billing. You will also need to be aware of any changes to billing policies and regulations from CMS. These are updated regularly, and you’ll need to stay updated on any changes in billing and coding guidelines. Furthermore, individual insurance payers may have specific policies or requirements that can affect how you bill patients that have that coverage.
The purpose of the secondary resources is to distill the information from official sources and make it easier to access. Rather than poring over hundreds of pages of CMS documentation, these trainings will give you the essentials in a more engaging and digestible format.
Some valuable training resources include:
The American Psychiatric Association’s coding & reimbursement portal contains a range of resources, with the most recent updates dating to the end of 2022; some trainings require a paid membership
The American Academy of Child & Adolescent Psychiatry’s CPT & reimbursement page contains a number of resources and webinar recordings that go into great detail about billing issues, with the most recent webinar dating to 2021
AAPC’s Codify portal provides detailed information on CPT codes related to podiatry. Again, this is information that can be found elsewhere, but the portal makes it easily accessible and it is kept up to date
The AAPC also has a comprehensive training on behavioral health coding
Practitioners should consider either have a coder on staff who will review these trainings, or working with a billing service that specializes in mental health billing. While the provider should keep abreast of any changes in billing practices, additional assistance from a specialist can be well worth it.
Regardless of how you do it, it is important to develop a routine to familiarize oneself with new billing & coding policies and regulations as they are enacted.
The Importance of Clinical Documentation in Billing
Both insurance and government payers require specific documentation to support billing claims. The EHR must clearly demonstrate medical necessity of all procedures, and accurately and completely describe care provided. Ensuring that your documentation meets the requirements of the payer and accurately reflects the services provided is essential, as failure to provide adequate documentation can result in delayed or denied payments.
In modern practice, most mental health providers should consider working with a scribe to ensure documentation is completed efficiently and thoroughly. Proper documentation helps ensure that the billing codes accurately reflect the services provided, reducing the risk of compliance issues.
The Role of A Mental Health Billing Service
Before submitting claims to payers, your billing service will analyze all documentation, generally using a combination of manual review and claim scrubbing software, to identify potential issues. Correcting issues before initial submission ensures that a higher percentage of claims are paid the first time.
Once claims are submitted, insurance companies review all documentation for accuracy and compliance. Omissions, inconsistencies, potential compliance issues, or any other aspect of the claim that does not align with either CMS or payer-specific billing policies and regulations will likely result in a denial of reimbursement.
Managing denials, and ensuring that denied claims are ultimately paid, is of your billing service’s primary tasks. If and when a claim is denied or payment is delayed, your billing team must:
Identify and track all claims for which payment has not been received within the expected time frame
Investigate to determine the reason for the delay or denial of any payment
Appeal claims that were denied incorrectly
Correct any errors in claims or EHR, add missing information as needed
Resubmit claims after errors are corrected
Track resubmitted claims until payment is received
This process can be quite time-consuming, may even be repeated several times for some claims. It may be necessary to contact the payer by phone to discuss certain issues. Certainly, claims that are paid immediately require far less time and effort. However, given the complexity of the billing process, some number of errors are all but inevitable.
However, while the follow-up and appeal process may be onerous, it can have an enormous impact on your practice’s revenue. A billing service that works diligently to ensure that all claims are eventually paid is easily worth its cost.
Key reports
Your billing service should provide you with the following reports, so you know what’s working and can identify areas of potential improvement:
Clean claims rate: This measures the percentage of claims that are accepted and processed by insurance companies without any errors or rejections. A higher clean claims rate indicates an effective billing process, as it reduces the likelihood of delayed or denied payments.
Days in accounts receivable (AR): This measures the average number of days it takes for a practice to receive payment for services rendered. A lower days in AR indicates an effective billing process, as it means that claims are being processed and payments are being received in a timely manner.
Collection ratio: This measures the percentage of billed charges that are actually collected. A higher collection ratio indicates an effective billing process, as it means that the practice is successfully collecting payments from insurance companies and patients.
Denial rate: This measures the percentage of claims that are denied by insurance companies. A lower denial rate indicates an effective billing process, as it means that claims are being submitted correctly and accurately.
Accounts receivable aging report: This report breaks down the practice's accounts receivable by the number of days that payments have been outstanding. A well-managed accounts receivable aging report should show a high percentage of payments received within 30 days and a low percentage of payments outstanding for 90 days or more.
By regularly tracking and analyzing these and other relevant metrics, an you can evaluate the effectiveness of their billing process and make improvements as necessary.
Benefits of Working with a Specialist
Our firm specializes in providing billing services for mental health practitioners. This has allowed us to develop a depth of expertise which others are unable to match.
In other words, we know how to bring faster reimbursement and more total revenue for our clients, with less stress!
If you’re interested in learning more about how we can assist your practice, please do get in touch: