164: What if reimbursement disappears
Mar 10, 2024
164 Transcript - What if Chiropractic Reimbursement Disappears
Attendees
Dr Michael Perusich, Marisa Mateja
DISCLAIMER: The information presented in this broadcast is for educational purposes only and is not intended to offer legal, investment, accounting, or medical advice. Seek the consultation of a professional for advice in those areas.
Dr Michael Perusich: Chiropractors how stable is your reimbursement?
Hi everybody. Welcome to the KC CHIROpulse Podcast brought to you by ChiroHealth USA and Kats Consultants. Welcome everybody to the show. I'm Dr. Michael perusich. I'm joined by Marisa Mateja. We're your hosts today and Marisa. I want to talk about This idea that you and I dance were back and forth. Sometimes what happens, and this is just hypothetical. I don't have a reason to believe this really but it's just an interesting conversation what happens if reimbursement just dries up and goes away.
Marisa Mateja: It's a great question. I mean, you're right. We do banter a lot. We banter back and forth with the idea of reimbursements always declining right? So what happens…
Dr Michael Perusich: right
Marisa Mateja: if it does go away, and so it's a great topic and I'm sure there's a lot of docs out there going you because it really goes down to looking at your practice and saying, are you a good balanced practice and what I mean by that is your insurance versus your cash. Are you balanced on that? Because that's what it really comes down to if insurance goes away. Where does your money come from?
Dr Michael Perusich: yeah, so let's dive into that just a little bit so Inherently, I think we all know there's a difference between getting bement reimbursed by the insurance company and getting reimbursed by your patients. fee for service cash Based Services and when we look at the two. So you look you look at insurance reimbursement. The two are kind of diverging away from each other. So interns reimbursement is having a tendency to keep going down and The ironic thing is Hash reimbursement on the cash side is actually kind of ticking up a little bit. At least from what we see, I can't say that's necessarily across the board in the profession. But what we see with our clients, it's actually going up.
Dr Michael Perusich: And so that creates an interesting conundrum between the two if you're heavy insurance reimbursement dependent. You don't have a lot of control there, Because I mean we can set our fees all day long,…
Marisa Mateja: right
Dr Michael Perusich: but the insurance companies only going to reimburse us what they want to reimburse us and the rest just is a write-off as opposed to The cash side we create kind of So in an investment banking, we called it a safe haven. you create kind of the safe haven over there where you do have control over your fees. you can show value to patients and you have control over where you set your fees and how much you're paid for your services. And as that goes up and the insurance reimbursement goes down. What happens in the middle is risk?
Marisa Mateja: Mm-hmm
Dr Michael Perusich: And so if you're heavy Insurance your zone of risk if you will As reimbursement goes down. The zone of risk is going up to your practice.
Marisa Mateja: Yeah, and it also creates, a value marker for your practice. It's worth right. So what your practice is worth depending on…
Dr Michael Perusich: right
Marisa Mateja: if you're heavy Insurance, you're actually worth less. In the marketplace and so, …
Dr Michael Perusich: Yeah.
Marisa Mateja: there's a whole bunch of factors. You have to look at there for that that's why I said you almost need a good balance of the two, especially if you're going to keep accepting insurance and things so that you've got good reimbursement coming in. But if we go back to that risk side of everything, the insurance side it's risky.
Dr Michael Perusich: It's very risky and part of that risk is if you're going to be heavy Insurance space then you've got to have volume. And so now you're under the gun to bring in more and more new patients all the time. if you're not careful with that you create not only a capacity issue but you start bouncing off the capacity ceiling and you actually keep knocking your practice down. And so then as we see dropouts. Go up then we want to shove more new patients. So it's kind of the old Chiropractic management model. It's more new patients and at some point. That kind of breaks the practice down too because what do we do to keep more new patients coming in? We keep lowering the price and lowering price. So Dr. Fox just said this the other day. as we devalue our services we wind up thinking that working harder is going to
Dr Michael Perusich: Save the practice. So we're starting more new patients, which I mean come on everybody. You have to agree with this new patients are the hardest ones to see And as you lower your price now now it's three four five visits before their profitable and…
00:05:00
Marisa Mateja: absolutely.
Dr Michael Perusich: if they drop out then you lost money and so as you devalue yourself and you get the mentality that I'll work harder to bring the practice up. And we think that patients are going to notice that we're working harder and find more value in it. I think the opposite is This is what Troy talks about. The opposite is true. Because what really happens is as you The patient's devalue your service.
Marisa Mateja: Yeah.
Dr Michael Perusich: So you throw yourself in kind of this trap and that's part of that risk Zone that you get into.
Marisa Mateja: Yeah, and then there's another risk Zone obviously with insurance. It's the audit side of everything. So the more you build the more you're on a radar screen whether you're doing things correctly or not, so I want to put that out there you're on that no matter what if you're billing a toned insurance and so
Dr Michael Perusich: Okay, I hold that thought I want to dive into that really really deep. We need to throw a word from our sponsors in here real quick, but we're talking about. What happens if and again this is just rhetorical if insurance reimbursement just goes away just dry something goes away. What happens to your practice? How stable is your practice without it? So we're gonna dive into this a little deeper and talk about some of the other risk associated including audits. Everybody's favorite topic so we'll be right back.
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Dr Michael Perusich: Alright everybody. Welcome back to the KC CHRIOpulse Podcast brought to you by ChiroHealth USA and Kats Consultants Marisa you brought this up before the break audits one of the risk zones in practice. So do we get audited on the cash side of practice?
Marisa Mateja: Absolutely.
Marisa Mateja: I mean not typically like you would or…
Dr Michael Perusich: we Yeah,…
Marisa Mateja: the insurance side, correct?
Dr Michael Perusich: but we're not under the gun quite as much.
Marisa Mateja: Yeah, you don't have insurance companies requesting records to evaluate whether or not they can pull money back out of you that they've given …
Dr Michael Perusich: right Yeah,…
Marisa Mateja: so that's the reality.
Dr Michael Perusich: an audit on the cash side of practice would be your state board coming after you for reason or some kind of fraud issue or…
Marisa Mateja: right
Dr Michael Perusich: something. So that's not what we're talking about. So on the insurance side, that's where a lot of the audits happen. And so Let's talk about the risk factor there.
Marisa Mateja: Yeah.
Dr Michael Perusich: If you're heavy in insurance, I don't know pick something if you're an 80% Insurance based practice. Are you at higher risk of audits than a cash practice?
Marisa Mateja: Absolutely.
Dr Michael Perusich: Sure, because you're throwing more billing out there the more billing you put into the system. The more possibility there is that you're going to get audited now. And we ever heard of a client say my gosh. I can't wait to get audited audits or…
Marisa Mateja: No, no,…
Dr Michael Perusich: fun. No.
Marisa Mateja: and I think the audit side of everything happens because we don't keep up with changes in the rules and the laws of what we're billing. So, this often we see clients or other docs that are not clients that come to us with questions in regards to their billing and we're looking at it going. you're following rules that are 20 years old, you're not keeping where you should be and what you should be sending out and that's where some of the traps fall for audits,…
Dr Michael Perusich: right
Marisa Mateja: It's not keeping up not reading that. Wonderful CPT book every single year, and we do need to be doing those things to keep up with it.
Dr Michael Perusich: Bible
Marisa Mateja: Otherwise, it's just what we said you fall into that risk side of everything under the insurance stuff. So you brought up to me. An article that you are reading in regards to some hospitals and different things and I think it's important to bring this up because this is not something that chiropractic specific right? It is across the board whether you are a provider of medical stuff.
Dr Michael Perusich: right
Marisa Mateja: If you're a hospital, it doesn't really matter what kind of facility you are everybody seeing declining reimbursement.
Dr Michael Perusich: Everybody seeing declining reimbursement. So the article that I was reading is about rural hospitals. And how many of the rural hospitals are operating in the red so negative cash flow. And how many of them are at risk of actually closing up? and so These small communities are starting to kind of flip out with the idea that they could be losing their local Healthcare if that happens because that's also going to suck the medical doctors away and those kind of things that work in those hospitals. And the conundrum is balancing costs Rising expenses, which we all feel. In our Chiropractic practices face paper today is way more expensive than it was five years ago.
00:10:00
Marisa Mateja: all of us
Dr Michael Perusich: For example So everything's more expensive employees are more expensive everything when I don't even need to make a list.
Marisa Mateja: sure.
Dr Michael Perusich: and then the flip side of that is we've got declining reimbursement from General insurance companies hospitals are paid differently in Medicare than Part B Physicians, so it's not so much the Medicare, but I'm going to come back to that in a second. And then the Medicaid patients don't even begin to pay for themselves with reimbursement. And she got those two things happening. And then you've got in a lot of these rural communities, you've got the declining tax spaces. So the way they lived in the past was they haven't made enough from insurance reimbursement to cover all the expenses for quite a while but state and local governments and agencies were coming in through the tax base and subsidizing these hospitals. the tax base in so many of these rural communities is going down.
Dr Michael Perusich: Because especially after the pandemic you have more people moving to more urban environments or Suburban environments and leaving a lot of the rural communities. And so tax base So now that subsidy in a lot of instances is going away and it's leaving kind of this weird potentially dangerous whole in the healthcare Market as a result. So let me come back to Medicare. So in the Chiropractic practice. We deal with declining reimbursement from General Insurance. Just like the hospitals. And we deal if there's Chiropractic benefits and Medicaid in your state you deal with the same thing with Medicaid. It's not profitable. And then we have And re Does Medicare reimburse No reimburse number one for only three codes and…
Marisa Mateja: no.
Dr Michael Perusich: number two. Does it go down every year pretty much.
Marisa Mateja: Yeah.
Dr Michael Perusich: Pretty much. I mean it fluctuates a little bit, but I know since you and I have been in practice. it's much lower than it used to be. So you're getting hit from all these angles on top of everything Rising costs lowering reimbursements.
Marisa Mateja: Absolutely.
Dr Michael Perusich: Creating this danger zone. The insurance companies have really stepped up audits because why do they want to do audits? they want more profit. And so they look at us and say if we can go and find something wrong we can get all our money back and then some
Marisa Mateja: Yeah.
Dr Michael Perusich: and in some scenarios they can get seven times what they paid you back. so in some ways I'm thinking that the insurance companies might look at us as kind of a savings account
Marisa Mateja:
Dr Michael Perusich: Hey, put $100 in and then in a year from now we can go get 700 back. I mean, that's a good deal and I'm not trying to scare everybody, but that's not the point here. But the point is How does that make your practice stable or unstable?
Marisa Mateja: Be on the insurance side meaning they've got 80 or 90% of their reimbursement coming from insurance patients or Insurance Side of Everything versus their cache side and it's an important thing to evaluate and make sure that you are in a more balanced scenario, and that way again, you set yourself up for a long term success in selling the practice when you get to that exit strategy, right? You set yourself up for higher reimbursement…
Dr Michael Perusich: right
Marisa Mateja: because if you set your fees and you have a good legal cash program available to patients you end up with a better retention. So you end up not having to worry about as many new patients coming in the door. There's so many benefits I could go on and on but there's so many benefits to that side of the practice and making sure that you're truly living in a balanced world.
Dr Michael Perusich: Yeah, that should be a song. when you look at the cache site, It's where you're gonna have less hassles, with records and those kind of things. You still have to keep records? But you're not going to have to read through them sign off on them and…
Marisa Mateja: Yeah.
Dr Michael Perusich: and ship them out as often as you're going to in the future on the insurance side. So there's that part we see the cash side of practice being more profitable, so when was the last time you looked at your profitability, especially if you're having Insurance based practice and you're watching reimbursement go down and expenses going up. How is that affecting your profitability? and…
00:15:00
Marisa Mateja: Yeah.
Dr Michael Perusich: your profitability is not just the amount of money you have in the bank.
Marisa Mateja: right
Dr Michael Perusich: are you truly turning a profit in your practice when we Look at Revenue versus expenses.
Dr Michael Perusich: if the insurance side of the practice is forcing you to be more high volume to make up the difference. How long can you work that hard?
Marisa Mateja: Yeah, and really if you think about that high volume is it's dangerous to the practice anyway, because you mentioned it earlier you're hitting a capacity ceiling and bouncing back down a lot of times. So that means that if you're seeing a trend of Peaks and valleys that are pretty good in your practice and you're watching those numbers that's an issue, you're hitting that capacity ceiling and that means you're working way too hard and probably not retaining very well.
Dr Michael Perusich: Yeah, and that's what those bumps are. That's your drop-in retention. Absolutely. you brought this up too, and I want to hit on this a little deeper. The cash side of practice is what brings value to your practice. So we talk about value. What is your practice actually worth? And unfortunately, we see this a lot we see doctors who are thinking about selling and they want to put a value to their practice and oops all of a sudden they realize My practice isn't worth what I thought it would be. so we just Spent a bunch of time at a seminar here recently talking about this and what are the things that make your practice more valuable on the street? If you're going to sell it at some point I think that's the Assumption most of us make in practice. Is that part of our retirement Nest Egg will be what we get out of the sale of the practice.
Dr Michael Perusich: And if that's the case, you need to really start watching. I don't care how long you've been in practice whether you're early in practice or latent practice. You need to be watching this because there are things that can take away value from your practice and one of them is being heavy insurance.
Marisa Mateja: Yeah, and it's important to know what those things are and really be evaluating that every single year to see where you're at and make sure you're staying up on that. For sure.
Dr Michael Perusich: right Yep, exactly. So I know a lot of you out there probably interested in this conversation. And again, this is just a rhetorical thought that we like to be a little disruptive in our thinking process. And so we like to play what if game do yourself a favor take this to Heart what if insurance reimbursement goes away. How was your practice going to be affected? And work on…
Marisa Mateja: Yeah.
Dr Michael Perusich: if you feel like it's going to be dramatically affected negatively and impacted then work on strategies to start turning that the other direction bring some stability some safety into your practice and create that safe haven if you will. So that you don't just write reimbursement down to the bottom.
Marisa Mateja: Absolutely. It's so important for your future and what your values are going to be. So make sure you spend some time to evaluate that stuff.
Dr Michael Perusich: Yep, absolutely. So if you're a doctor out there that feels like you're stuck in the reimbursement slide. Give us a call. let's set up a breakthrough call. Let's talk about your practice and some of the great things that we're doing with clients and how we might be able to help you. We can't help everybody but we sure enjoy talking to you guys out there and we do that for free. So all you have to do is go to our website at the very top you can jump on my calendar and let's chat about your practice. So jump on my calendar and let's do that Marisa. We've also got all kinds of resources on the website and…
Marisa Mateja: My gosh.
Dr Michael Perusich: forth.
Marisa Mateja: Yeah, there's a ton of resources. I put something out not too long ago that gives you kind of a sample of a lot of the different things that we do sign up for it. It's free. It's just check us out and then Something to really think about being disruptive in the industry. we have a great online program that gives you the basics gives you just a huge library of information from forms to videos to all these things that help you stay up on all these conversations that we have. It's a great option for new docs that have been practice for a while that don't really need the one-on-one but really want to stay plugged in and have that resource tool that their fingertips and so, check it out. It's a great program for everyone.
Dr Michael Perusich: Absolutely, and that library is being constantly updated and added to so many Tools in there for practice success. and be sure to subscribe if you haven't already to our podcast and…
00:20:00
Marisa Mateja: click
Dr Michael Perusich: tell all your friends and colleagues about it our podcasts. We're very blessed is growing like crazy. So we appreciate all of our listeners out there. And of course, we appreciate our sponsors ChiroHealth USA check them out. They're doing great things for practices as well as cats Consultants. All right everybody. Thanks for tuning into the KC CHIROpulse Podcast. We will see you next time.
Marisa Mateja: ya.
Meeting ended after 00:20:33 👋