Should you bill insurance companies for the services you provide? At some point in almost every practitioner’s lifetime, they ponder this question. So, if you’ve asked yourself whether insurance billing should be a part of your bodywork services, you’re not alone.
The initial thought to collect payment through insurance billing might come from a client, asking if you can bill their car insurance for their whiplash treatment. A physician might also ask if you can submit claims to major medical insurance companies for the therapy you provide to their referred patients. Or, you might have heard that practitioners can make a lot of money charging insurance companies for therapy services, so billing is a prospect you want to investigate. And, it is possible that your clients might have their bills covered through their insurance rather than treatment being an out-of-pocket expense. So, “To bill or not to bill?” is a legitimate question worth investigating.
Laws and Licensing
In the US, state laws and licensing requirements dictate whether a therapist will be reimbursed at all for all forms of health insurance.
Many years ago, my San Francisco wellness center was billing insurance for about 70 percent of our services. We billed motor vehicle insurance and workers’ compensation and were getting paid well—and on time. This is because I spent many nights pulling my hair out and screaming at the computer in frustration, and through trial and error I finally learned the secret of getting paid by insurance companies.
However, over the years, the insurance laws changed dramatically, and there are many more restrictions placed on providers. These new requirements were aimed at reducing insurance fraud, but they limited the services we could provide—and the amount we were reimbursed. For example, we used to regularly bill code number 97010 for a hot/cold modality (for most treatment sessions) and, although we continued to provide the application and included the code and fee on our claims, workers’ compensation insurance completely stopped reimbursing us for it at all.1
Vivian M. Mahoney, author of The Insurance Billing and Practice Building Manual, says, “I would estimate only about 5 percent of the solo or small therapy clinics in the US are currently billing insurance for the services they provide. I think the biggest reason there are so few therapy providers actively billing is that they simply are afraid to take the time to learn how to do it ethically and effectively.”2
Over the last five years, my wellness center has slowly transitioned from predominantly charging insurance companies to being a cash-based practice, where we collect payment directly from our clients and patients for all services rendered. When requested by a client, we do provide a statement of all services, called a super bill.
A super bill includes all charges, payments (for all dates of service), and all the other required information on the provider, the insured, and the services. We provide the super bill so the client can submit the claim to their insurance company for reimbursement themselves.
Many of our clients understand the importance of receiving brilliant therapy, and the possibility of getting reimbursed is secondary to them. As a Precise Private Practice (a business model I developed that focuses on effective ways to serve both clients and therapists), we prefer not to bill insurance. This gives our providers much more freedom of clinical choice, as well as dramatically cutting down on office administration time needed for processing claims.
Is It Worth My Time?
It takes a particular type of person (and business) to do well at billing insurance companies. It is absolutely the right thing for some therapists and, alternatively, a complete nightmare for others.
Getting a certificate or degree in medical billing can take from six months to four years. But even if you don’t go to school to learn the ins and outs of billing, make sure you have the basics and nuances down before submitting even a few claims (to see how it works out). Remember, as with any industry, the laws, codes, and requirements change, so you must keep up to date.
Since most therapists and clinic owners do not want to switch careers and actually become medical billers, the alternative is to gain as much information as possible through trial and error or continuing education opportunities. You can learn what you need to be able to handle your medical billing, or you can choose to hire an outside person (or service) to submit claims for you.
If you want to bill insurance, but don’t want to handle all the paperwork yourself, outside billing companies typically charge 5–15 percent of collections—or they may charge a flat fee per date of service billed (regardless of the collection amount).
Michael Grise, of Hopkinsville, Kentucky, has been billing insurance for 10 years and says he typically collects around $180 per hour for a medical massage session when billing for either massage or manual therapy. He agrees that once you take the time to figure out how to bill ethically for your services, insurance can be an advantage for your practice.
Still not sure whether to bill or not to bill? Ask yourself the following questions to decide whether billing is right for your practice:
Does your business have enough cash flow to withstand not being paid for 30–90 days?
It takes time to receive payments from insurance companies—if you get paid at all. Depending on the type of insurance, most have between 30–60 days from receipt of your claim to reply to you. Their reply may be a request for more information, they may make a partial or full payment, or they may deny the claim altogether. Your business must have enough cash flow to withstand the time lag and be able to absorb the loss if they don’t pay, or pay only a small portion of the total bill.
Do you understand the overall concept of insurance billing and how it works?
There is a lot to know about insurance billing, and each scenario is different. You must be able to observe each situation and make decisions on how to collect from the insurance company. You must also know how to directly bill the client for any remaining unpaid balance. (Note: It is not legal for you to request payment for services from a client on a workers’ compensation claim. Workers’ compensation payments are considered paid in full.)
Do you have the infrastructure and time to generate, oversee, and follow up on insurance claims?
Discussing billing with a client (or their health-care provider) takes time. Confirming the client has coverage and creating the paper trail (or PDFs), and then mailing, faxing, or submitting them online takes even more time. Finally, you’ll need to follow up to be sure you get paid in a timely manner. All of this takes skill and infrastructure—skill that not everyone wants to learn and infrastructure that not everyone wants to obtain.
Do you know the purpose and use of ICD diagnostic codes?
The diagnostic code is determined by a medical provider who is licensed to diagnose your client’s condition. ICD stands for the International Classification of Diseases, and each condition, injury, disorder, disease, symptom, and infection—and its specific characteristics—has its own unique code. The coding is complex, and a therapist should never assign an ICD code to their client unless they are legally allowed to diagnose.
These codes are used to categorize and manage our country’s health-care system, and the diagnostic code(s) indicate why you are treating your client (and justifies the treatment and billing for services).
Do you know the purpose and use of current procedural codes?
Current Procedural Terminology (CPT), overseen by the American Medical Association, is coding used to report each procedure or modality that is provided to bodywork clients, such as manual and movement therapy and ice/heat. Health insurance companies determine if they will reimburse for each specific CPT code based on the license of the provider, the diagnostic code it is applied to, and other variables (such as other treatments performed on the same day—by the same or outside provider—and/or whether the condition being treated is stable or improving).
Do you have a business address you can list on the claims?
Do you see clients at your home? If so, you may not want your address to become public information. Place of service (in this case, your home address) is required on the insurance claim.
Do you have an NPI?
The National Provider Indicator (NPI) is a unique identification number for covered health-care providers. In order to be paid, the NPI must be used on claims forms by all health-care providers. You can apply for your NPI at https://nppes.cms.hhs.gov. This is a free service.
Do you have a TIN or EIN?
I always recommend you use your Tax ID Number (TIN) or, if you’re a corporation, your Employer Identification Number (EIN) instead of your Social Security number on all claims. Using a TIN or EIN will protect your identity. You can apply for your TIN and EIN at www.govfilingsonline.org/apply-for-an-ein.html. This is a free service.
How many of these questions did you answer yes to? You should use your yes and no answers as a starting point in determining whether you are the type of business owner who would be thrilled or frustrated by billing insurance companies for client services you perform.
Santa Cruz-based chiropractor, massage therapist, and MastersInMassage Institute founder Michael Kople says, “There is no type of insurance that pays 100 percent of everything, every time. Many major health-care companies do not reimburse for massage no matter what billing codes you give them.
“If you’re billing for straight massage, you can get sneaky and put in codes and modifiers that aren’t massage, like using the billing code for ‘exercise rehab/training’ and get paid for it, but you’re asking for trouble when you start billing for services you did not provide.
“It’s important to know what you’re doing,” Kople says. “When you involve insurance coverage, you must know how to manage the client’s care properly and take appropriate SOAP notes because they will most likely be asked to be seen by attorneys and insurance companies.”
Basic Billing Terminology
Claim—This is the bill submitted to the insurance company. The claim includes the date of service, charges, payments received (if any), provider information, client information, and appropriate billing codes.
Provider—This is YOU! You are the service provider submitting the claim for treatments provided. As a provider, you will submit the service claim to the insurance company.
Fee Schedule—These are the rates (or prices) you establish as fees for specific services. You determine your fee schedule, and you bill the insurance company for services you provide to your client.
Acceptable Claims
UCRs
Usual, customary, and reasonable (UCR) is the terminology used by insurance companies to determine what they will reimburse for treatments. UCR reimbursements are based on typical provider fees in your geographic location (most likely by zip code). If an insurance company considers your fees usual, customary, and reasonable, you will be reimbursed. If your fees are higher than other providers in your area, you will be reimbursed up to the normal UCR amount.
Medically Necessary
To diagnose or treat an illness, injury, condition, disease, or its symptoms, health-care services or supplies must be deemed medically necessary and meet accepted standards of medicine.3 Insurance companies evaluate the medical necessity to determine whether the services and products you provide to their insured are appropriate for the client’s condition and needs.
Where’s the Money? Insurance Types and Coverages
Here is an overview of the types of insurance you might encounter when billing for client services:
Motor Vehicle Insurance: Companies, such as Geico, AAA, and Allstate, are the best place to start when billing insurance.
Workers’ Compensation: Workers’ compensation is separated into coverage for state and federal workers. There are both federal and state laws to follow, so you must be clear on what is and is not legal—as well as knowing the process of attaining prior authorization and the billing process.
Major Medical: This insurance might include companies like Blue Shield, Aetna, and Kaiser. Until, and unless, you have success with motor vehicle insurance and workers’ compensation reimbursements, you should not attempt to bill major medical insurance companies.
Medicare and Medicaid: These insurance providers are separated into two programs. Medicare is federal health coverage for people over 65 or people living with a disability. Medicaid coverage is provided by the state and federal government for those with very low income. It is not recommended that therapists bill Medicare or Medicaid due to the number of legalities, required time, and the fact that in no cases (in my experience) has a therapist received reimbursement for services from these two entities.
FSA and HSA: Flexible Savings Accounts (FSAs) and Health Savings Accounts (HSAs) can be used when an employer provides these medical savings programs to their employees. FSA and HSA funds are taken directly from an employee’s paycheck, pre-taxed. The funds can then be used to pay for health services not typically covered by the client’s primary medical coverage. These accounts are the easiest for providers and their clients to use for direct payment or service reimbursements.
Conclusion
Insurance billing is a sound business practice for you to consider. If you choose to accept insurance payments, you can use that additional client service to your advantage to stand out from the other providers in your area, under what I call your Unique Appeal to Clients.4 Only you can decide if taking the time to understand the rules and learning how to submit claims for your clients is worth it.
I encourage you not to look at insurance billing as the “golden goose” that will bring you unlimited income. But, instead, realize that accepting insurance is a way for you to provide a high level of customer service—while providing therapeutic services for people who might not otherwise be able to afford to see you.
Notes
1. For more information on workers’ compensation changes in California, visit www.dir.ca.gov/chswc/
reports/chswcrptonsummarysystemchanges
draftfeb%202008.pdf.
2. Vivian M. Mahoney, Insurance Billing & Practice Building Manual (www.massageinsurancebilling.com).
3. For more information on “medically necessary” treatments, visit www.healthcare.gov.
4. For more information on the Unique Appeal to Clients, watch the video at www.youtu.be/NwAvRJal5zQ.