The Pitfalls of Behavioral Health Billing with Zach Rothenberg of the Law Firm Nelson Hardiman

We welcome Zach Rothenberg, a seasoned healthcare attorney from Nelson Hardiman Law Firm. Zach brings profound insights into the common pitfalls and challenges that treatment centers often face when dealing with payers. He provides enlightening advice on how to avoid clawbacks and losses of contracts and handle increasingly aggressive insurance companies.

Transcript

Behavioral Health Care Pitfalls and Audits

Speaker 1 0:00

Welcome to Hatching Creativity . This isn't just another behavioral health podcast . This is the place where thought leaders converge to talk about real life challenges , breakthroughs and pivotal aha moments . Thanks for tuning in to Hatching Creativity . Today I speak with Zach Rothenberg from Nelson Hardiman Law Firm . Zach is a behavioral health care attorney who focuses on billing and employment law . In today's episode , we speak about common pitfalls treatment centers fall into as it relates to payers . We also discuss common issues like how to avoid clawbacks or losses of contracts . If you like what you hear , please like , share , subscribe and tell all your friends about Hatching Creativity . Our guest today is Zach Rothenberg from Nelson Hardiman Law Firm . Zach , would you like to give a brief introduction about yourself ? Sure ?

Speaker 2 0:54

Be happy to . I am a health care lawyer at a firm called Nelson Hardiman . We are 20 lawyers . Our main office is in Westwood , right here in Los Angeles , California . We focus exclusively on the practice of health care , representing health care providers from individual practitioners all through some of the largest health care systems in the country and everything in between . We have a particular focus in behavioral health and in SUD treatment in particular . I would say , at least for me , it's probably . I would say , two-thirds of the work that I do is in that industry . I've been practicing law for about 20 years . Graduated of Harvard Law School , spent a lot of time at big firms and really big firms and then a very small firm where I litigated entertainment cases , realized those are not quite my people . The health care world , the treatment world in particular , I found are really my people , my calling , and I feel like I'm really at home in that world .

Speaker 1 1:53

That's great . How did you get involved in behavioral health care world ?

Speaker 2 1:58

You know , it really wasn't something that I necessarily saw out . I kind of just happened into it as I was making this transition from entertainment to health care . I just started doing , almost by happenstance , some work for some treatment providers and I just really was intrigued by it . I think , more than anything , it felt to me like a purpose , like a mission , a really under funded , undervalued enterprise that was helping more and more people every year . The need was growing every year . To me still , if you ask the ordinary person on the street what they think about this industry , it still has this real stigma and kind of a black mark . It's a shady industry . People are taking advantage of folks . I see that To me it turns into . These are the people I need to defend and represent and kind of clear their name into the future , because it's just such a valuable , valuable service .

Speaker 1 2:58

You know , what's real interesting to Zach is that if you look at the people working in the behavioral health care field , you're going to be hard pressed to find somebody who's not extremely passionate about what they do .

Speaker 1 3:15

People in this field see a sense of purpose here , and that's one of the things I love about it . That's something that you identified here too . Unfortunately , though , oftentimes they're not professional business people and they have another mission or another reason why they're in this field . Because of that , it exposes them to a lot of risk . So finding a law firm and attorneys that are in your same mindset and understand that this may be where the providers are coming from , I think that could be really valuable , which is part of the reason that I brought you on today , because there's a lot going on in the world of payer and payer relations , what people are getting paid , and there's a lot of topics going on right now in that area , and I'm curious from a legal standpoint and the work that you do . Can you tell me some of the most frequently , most frequent things people stumble into and some of the hottest areas right now being discussed ?

Speaker 2 4:31

Yeah . So I'll give you two , and they're sort of similar but they raise different issues and they both are payer audits . So I'm a little bit repeating myself here . But the insurance companies , in my view , are always looking for opportunities . They are a for-profit business . They are the opposite of what you just described as what drives the treatment folks . They are purely motivated by the bottom line .

Speaker 2 5:00

I don't think anybody gets into insurance out of a feeling of passion In any case .

Speaker 2 5:06

So you couple that with a few things that the kind of bad reputation that the treatment industry has based on , kind of the bad acts of a few bad apples and bad publicity , this huge surge in the need for behavioral healthcare , the what I see as kind of a lack of clarity or in outcomes , outcome metrics , and what you get when you combine all that together is the insurance companies feeling like they have the opportunity to be extra aggressive in denying claims on the front end and , I think , increasingly clawing back money on the back end .

Speaker 2 5:45

So what I'm seeing is particularly from SIGNA not to name names is what I call pay to play audits , where they send out a request for records , for a sampling of clients and invariably come back with this litany of what they call problems or issues that , by the way , are generally related to paperwork . They're not related to patient care , not related to quality of care , they're generally not related to medical anesthesity , anything like that . They're paperwork . You signed where you should have initially , you initially where you should have signed , and they say , as a result we want our money back for whatever we paid you on these claims .

Speaker 2 6:23

And then they say number two we also think it was systematic what you were doing . So not only do we want our money back for those 20 patients or whatever that were part of the sample , we want all the money back that we've ever paid you because we believe that you've been . This is representative of the fact that you've been doing this all along and there's horrible mistakes that we've identified . And then they say and therefore we are flagging you and we're gonna not pay you and that deny all of your claims going forward until this is resolved . So the upshot is you need to write us a big fat check or else you cannot treat our members going forward and I've probably handled two dozen of these over the past year or two . I mean , it's just everywhere .

Speaker 2 7:06

I don't know what tips , but I think that's the biggest thing that we're gonna have to do is to sign off to initiate these audits . I have a suspicion that it's just the number of dollars of claims that are going to sign it as opposed to anything substantive , but I don't know . But it's really something that causes great stress financially , emotionally and otherwise on these providers , especially the smaller ones who are getting hit with clawbacks . There are sometimes seven figures . I'm sorry , this is a long-winded answer . I don't know if it's more than you intended .

Speaker 1 7:40

It's valuable Absolutely .

Speaker 2 7:42

Great . The second one is courtesy of Optum . This is a little bit newer . We're seeing these audits that are focused exclusively on collecting from patients , which has been a topic for a long time whether , how and whether providers are required to collect from their patients the patient contributions so co-pays , deductibles , things like that . These new audits are saying send us all the records that relate to your efforts to collect from patients for a sampling of Optum's members . Then they respond and generally say it looks like you are not collecting or not making sufficient effort to collect . Therefore , we're not asking for any money back , but we are going to deny your claims . Going forward on the assumption that you are waiving patient responsibility and we consider that to be fraudulent , we're going to deny your claims . You have the opportunity , though , to appeal the denials and with substantiating documentation showing that you've collected from the patients . Once you appeal with these records that shows you've collected , then we'll pay you our share .

Speaker 2 8:53

This , to me , is hugely problematic and groundbreaking in a number of ways . First of all , it's a really substantial change from the past , where we've had an understanding that providers certainly can't systematically waive patients . They can't tell patients look , come to us , we're out of network , we're not going to charge you anything . That has been a no-no for a long time and you can't advertise that . You can't do it systematically across the board .

Speaker 2 9:20

However , there's been an understanding that , look , the patient population frequently is not in great financial situation . It may invariably be that you're not going to collect from the patient , but you have to try . You have to make a real effort . There's old wives tale that you have to send out three invoices , which I think is a myth , but you do have to make a good faith effort . But this is now saying this new audit from Optimus saying you actually are required to collect before Optim has to pay you anything . There's no law that says that . There's no deadline in any law by which you have to collect . It's not realistic that every provider is going to collect from every patient 100 percent every time . To me this is groundbreaking stuff . It's pushing the envelope really really far beyond what the law requires . Again , it's a new opportunity to deny claims . Those are the two hot topics we're seeing .

Speaker 1 10:18

Those are the two hot topic . I'm never shocked at what the insurance companies do at the expense of their members . At the same time , what I think would also be really helpful , zach , being that this is really your area of expertise . I'd like to walk it back a little bit , root each of these topics and discuss some ideas that you can , or a provider can , use to protect themselves in these situations . The first one , where you were talking about specific documentation and that it's done to the T . I think it's really important that people know and understand their policies , what their programs are . That is really important . Then , of course , being extremely detailed , don't have Joe the janitor dealing with documentation . It needs to be somebody who is completely undistracted and focused solely on that as their job if you want to have things done right . That just seems low hanging fruit , but from your perspective and from your experience , what are the best tips that you can give to protect yourself from this kind of punitive audits ?

Speaker 2 11:46

The first one you hit right on the head , which is just your documentation has to be pristine , it has to be perfect and complete . I find that people have it in their heads that kind of good enough is good enough , and what I tell people is that at the first pass it may be right . I mean , things go under the radar all the time . These insurance companies are dealing with just a huge volume of claims and stuff to look at , and so you might be right that things go under the radar for a while . But the problem , though , is , as soon as there's an audit and there inevitably is they're gonna take advantage of any little opportunity you give them .

Speaker 2 12:29

So it's critical that you have to . It's hard psychologically because you have to have the motivation within yourself to maintain perfect paperwork always , Because you're not gonna see the benefits of it necessarily for some time or maybe ever , but it's very likely that at some point you'll be audited and you will be thankful that you pushed yourself as hard as you did to be as careful and complete with your paperwork as possible

Clarity in Dealing With Payers

Speaker 2 12:58

. The other thing that comes up a lot is how making sure you have a real sense of clarity as to what is being expected of you , and it differs from payer to payer and it seems like it differs from year to year within each payer , and a lot of folks think that they can kind of play dumb , that if push comes to shove they'll just say well , I guess I was confused . I was looking at Optum and not SIGNA , or SIGNA and not Edna or whatever it is . Or I was looking at 2021's information .

Speaker 2 13:32

My bad , and that may get you out of a lawsuit . It may make it not fraud that you made a mistake , but in an audit or something like that , there's no intense requirement . If you aren't following the most up-to-date current requirements , they're not gonna pay for it , and if they've already paid you for it , they're gonna get their money back or they're gonna insist on their money back . So it is- .

Speaker 1 14:01

Some lessons are more expensive than others too . I mean , this could be a very expensive lesson that you're helping people prevent right now .

Speaker 2 14:10

So an example , just put one fine point on it .

Speaker 2 14:12

An example that comes up every time is the notion of what is evidence-based versus non-evidence-based therapy , and a lot of the payers will say a certain percentage of your time , the hours that are part of a day of IOP or whatever , need to be quote unquote evidence-based , and no one none of my clients at the start of this discussion know what that means .

Speaker 2 14:37

When they have a vague notion of what evidence-based is and they may actually have a really good understanding of what may be an MD , psychiatrist and have a great educational background on what is evidence-based or not they don't know what each payer means by evidence-based and unfortunately that's the definition that matters . So I would encourage people to never be comfortable being even 10% unclear . Pick up the phone , make a phone call to the payer whoever your representative is , your contact is , or maybe calling you , mike or somebody who has a contact , or me and figuring out a way to get the answer from each payer as to what it means to be evidence-based what hours are going to count ? Because eventually it's gonna matter and you need all of your hours to count or else you're gonna get caught back .

Speaker 1 15:28

You know to your point here . I have had so many conversations with Renee about this and people are afraid to reach out to their payers . They're afraid to reach out to their legislators , they're afraid to reach out to their state or the Joint Commissioner , whoever it is , because they're afraid that that might run up some kind of a red flag that they're asking these questions At the same time . Usually it's appreciated I know from the auditors and from the surveyors and from the states and Joint Commission . This is what they wanna do . They want to give people good information From the payer perspective . Is that what's encouraged to reach out to the payer and who at Cigna or Optum or BCBS would somebody be reaching out to to get this information and to ensure that they get the right information ? Part two of that question is how do they document the conversation and what they were told in the event that what they were told may have been wrong ?

Speaker 2 16:38

Yeah , both of those are good questions . The first part is A tricky one . I sometimes wonder what the payer's motivation is . Right , because on one hand you can see at least in the SIU side of it they have an incentive for you to not bill correctly .

Speaker 1 17:02

Because they are a moneymaker .

Speaker 2 17:03

They're a profit center for the insurance company . They claw back bad claims , what they consider to be bad claims . So if they fix the problem on the front end , there's sort of less low hanging fruit for them to collect on the back end . So sometimes it is not .

Speaker 2 17:17

I think that's probably the reason there's no 800 number with operators standing by hands or all the professions Because they don't necessarily want to make it easy on you , but I do think there are ways to force answers , and sometimes it takes . In my experience it can take sending several letters and making some kind of veiled threats at litigation or something before you're able to get a phone call or a Zoom with . For me , it's usually a lawyer who knows the answers to these questions . So it takes some pushing but we're able to do it . I wish it were easier and it seems to me if there was a genuine interest in having this all done the way they wanted it to be done , it would be easier , but it's not always the case .

Speaker 1 18:00

And what about verifying the information that you're given ? How do you make sure that , when somebody tells you something from one of the pairs , that the information is accurate , or how do you at least document that you got that information from them , should you end up having a clawback anyway ?

Speaker 2 18:18

You sound like a guy who's worked with lawyers before you should absolutely always document these and ideally , you're sending if you know the email address or the heart address of the person you've been speaking with , you send them some kind of confirming letter . That's what I do . I'll send me a thanks for the meeting . I just want to make sure that I was understanding . Here's how I understand . We should be doing X , y and Z , going forward , and you spell it out , and you won't get a response . But that's fine too , I guess . Alternatively , you send a memo to the file or something like that . But yeah , you want to have something . And , by the way , it's not just so that you can hold it up and say see , I asked , this is what you told me , it's also so that you don't forget . So you have a record in your file of exactly what they said , so that you do it right .

Speaker 1 19:08

I like that . I think that those are a couple of really good ideas and I appreciate that One of the things that we recommend very regularly is chart auditing , too .

Chart Auditing and Patient Responsibility

Speaker 1 19:20

How often people don't audit their charts or they just audit their charts to keep the joint commission off their back . But really chart auditing is a huge time saver , money saver , risk reducer , as well as good chart auditing is going to improve your clinical skills and your documentation skills . But those are some things that are really important to keep an eye on for sure .

Speaker 2 19:50

It's a real mental reset . Right People audit their charts hoping they don't find problems . You should almost hope you do find problems , because then you're fixing them right . It's something to show for all this hard work of auditing . Don't be afraid to find mistakes . It's better that you find them than that you just ignore them .

Speaker 1 20:06

It's better that you find the mistakes than the auditor comes in and finds it too . So , with your second point , where you were talking about patient responsibility , what are your tips or what kind of advice would you have on protecting yourself from getting into trouble relating to collecting and documenting your patient responsibilities ?

Speaker 2 20:30

Yeah , again , it comes down to documentation and you want to make a real effort . The biggest point I can make is that the notion that you can send three invoices to the last known address is not a real thing . I don't know where that came from and why people think that's gospel , but it's not . It shouldn't be , because I think most of the time when people do that it's just paper pushing . They know that they're not really trying to collect and they genuinely do have an obligation to try to collect in a real and meaningful way . Again , there's nothing wrong with sending invoices , but if you know that that's not where the person lives anymore or you know that they're just throwing these things in the trash , you got to do something different . You have to really show that you are making the efforts of a reasonable business person who is genuinely trying to collect this money . You don't have to go to the ends of the earth if you know someone is homeless or broke or you don't know where they are . There's no reason to spend a fortune I don't know , spiling a lawsuit or sending out an investigator to track them down for a couple of hundred dollars . That doesn't make any sense . But you have to make what appears to an objective bystander to be a real legitimate business decision and make real legitimate business efforts to try to collect . That's number one . A loophole is certainly not the word .

Speaker 2 22:05

The one big sort of alternative approach that you can sometimes take is I do think there is an opportunity to consider financial hardship Because , as you know , the patient population obviously often is experiencing difficult financial hardship . And so I think there is an opportunity to again document and evaluate the financial situation of the client and determine whether there is a possibility for hardship . And we have all sorts of paperwork that we've developed over the years and actually had vetted by some of the major payers to document hardship , sort of on a sliding scale based on the federal poverty guidelines , to determine whether and to what degree we can reduce the patient's financial responsibility based on their financial situation . So that's another big factor .

Speaker 1 23:03

It's also important to mention , with what you're talking about , that you have a policy around this , that you document . What is our standard policy around scholarshiping or financial hardship ? Because if you don't have a policy and you're just flying by the seat of your pants with those things , you're still at risk . Yes , even if you have an understanding of what you're talking about and you have an understanding of poverty levels and what someone's financial situation means in their specific location , you still need to document and have it written in your policies , because you will be asked to have your policies looked at too .

Speaker 2 23:54

And to follow those policies in a consistent manner . You wanna do the same thing every time and , by the way , not just for the benefit of the payers or whoever , but also so that you're not showing favoritism right ? There's a potential for discrimination here who you're gonna give a hardship , a fee reduction to , and who you're not . You wanna make sure that it is blind to everything except the financial need .

Speaker 1 24:20

Well , that's a good point and it's also important to mention anytime you were talking policy that you are documenting . You're supporting documentation , you're supporting evidence that you're actually following your policy right , because anybody can say that they're doing anything . But you need to be able to back that up and have your information readily available to you so that , one , you can audit yourself , but two can be prepared when that inevitable audit happens . If you don't have it handy or if you're not ready with it at a reasonable amount of time , it could set off red flags that you're just making it up . So things to consider here . What are your thoughts on solutions like FinPay or one of these kinds of software companies or financial backers that helps with that payer responsibility ? Have you had any experience with anything like that ?

Speaker 2 25:25

To a degree , but I would say it's more so folks who try to incorporate or integrate the collection process into the admissions process . Right , so that you are . They say you should be talking about discharge planning from day one . You should also be talking about these financial issues from day one and how you're going to collect . You don't need to start collecting on day one , but you want to make your expectations clear . You want to explain what's going to happen down the road right away . And so I know there are companies out there I've worked with plenty of them who get in under the hood and really get into your processes so that they're involved from day one in forming and setting expectations , getting information from clients , so that on the back end your collections will be smoother and more effective and less jarring .

Speaker 2 26:25

I think a lot of the pushback from providers on collecting from patients is you don't want to upset your clients , right ? They're in a difficult situation as they are . They're already vulnerable and the client's always right . You kind of have that mentality right . So I think these services can also help set expectations so that when you go to collect you're not the bad guy , at least in your own mind .

Speaker 1 26:46

Well , you take somebody who just got out of treatment and all of a sudden they've got this huge bill . You know that's a very good way to throw somebody into a tailspin , which is not what we're looking to do here .

Speaker 2 27:00

That's right .

Speaker 1 27:01

If you're a treatment center and you're looking at one of these solutions , what should somebody be looking for and what should somebody be wary of and want to avoid ?

Speaker 2 27:13

Yep , so I think what you're looking for is somebody who is curious about your processes , someone who really wants to integrate into your processes . If it's a standalone service , I just and , by the way , this is true for a lot of the services I would say the same thing about finding a good lawyer . It's someone who wants to be a part of your system and your overall business , and not this standalone silo that you do your thing and then we'll go and collect , because that's the people who are the stereotypically knocking on doors and making threats and calling people during dinner time and whatever . You want somebody who is looking out for your processes and your reputation , because it's your reputation that's on the line . When somebody gets this aggressive dinner time call , it's you that looks like the bad guy , not them . So you want someone who really is focused on that and concerned about it and cognizant of the tone that they're setting in how they're doing this potentially really jarring work .

Speaker 1 28:23

That makes sense . That makes sense . I really appreciate

Informative Discussion With Zach Rothenberg

Speaker 1 28:26

it . And , Zach , this was really informative . This was some great information . I really appreciate you joining us . We're going to be bringing Zach on again really soon and thanks for joining us today and make sure to check out Nelson Hardiman and Zach Rothenberg . Thanks for tuning in to Hatching Creativity . We appreciate your support . Please don't forget to like and subscribe and tell all your friends about the show and remember it's never just about one thing .