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Benefits of a prospective payment system

prospective payment system

If you work in the medical billing industry, you understand the many different ways patients can pay for the services they receive. In many cases, a patient will go to their appointment, receive their service, and pay after or be billed in the future. This is typically the standard for medical billing, but it isn’t the only way you might charge a patient. If you’re billing for certain Medicare services, you might use the Prospective Payment System for your billing. If you aren’t familiar with this system, we broke down the basics for you. 

What is a prospective payment?

The Prospective Payment System (PPS) is a fixed payment system developed by the Centers for Medicare and Medicaid Services. This predetermined structure is designed to improve efficiency among healthcare providers so that they can provide better care for patients, get diagnoses faster, shorten hospital stays, and ultimately decrease costs. The PPS system sets a predetermined payment cost for each Medicare patient based on the diagnosis and standard care needed for that diagnosis. The cost covers a specified amount of inpatient hospital stay or home health care. 

Services that use PPS

PPS is used for services in which the biller can simply define a fixed rate for said services. These scenarios can all be examined to determine a fixed, potentially recurring rate based on the amount of time the patient receives services. The following are some scenarios in which you would bill using the Prospective Payment System. 

Acute inpatient hospital stays

Although the stipulations vary per state and region, acute inpatient care is typically a hospital stay lasting less than 25 days. If a patient is admitted to one hospital for a specified duration of time to receive care for their diagnosis, you might charge them using the PPS. This keeps the patient aware of what they’re being charged rather than receiving a surprise bill at the end of their stay. 

Home health agencies 

If you or a loved one is receiving home care, you will likely be billed through the PPS. Home care is typically a recurring scenario where the patient receives help in their home. This could be as simple as light housekeeping and meal preparation, or become more involved to include help administering medicine to the patient, assistance bathing and toileting, and more. This may be for a specified time based on a patient’s current condition, or it may be for an undefined amount of time. Either way, the patient is billed a fixed rate, typically billed every couple of weeks or once a month based on the scenario. 

Hospice care

Hospice care may take place in a patient’s home or in a separate hospice care facility. In both cases, the patient is billed a fixed rate for the services they receive. 

Inpatient rehab facilities

If a patient is in a situation where they need to be admitted to rehab, the PPS can be used for billing. The patient may or may not know how long they will be in the rehab facility for, but they will be billed a fixed rate based on the specific care they are receiving.

These instances are not the only places that the PPS may be used for billing, but they’re some of the most common. If you’re curious about a specific establishment using PPS, reach out directly to that facility to find out how they bill. 

The best billing methods 

 When it comes time to bill your patients for the care they have received, how do you do it? Classic billing consisted of many hours spent filing paper claims, ensuring that all necessary information was included and that it was submitted properly. Luckily, modern billing has evolved to make the process much simpler and quicker for medical billers. If you’re looking for the best way to bill, look no further. We’re highlighting a must-have solution—if you’re billing without it, it’s time to change that. 

Medical billing and coding software 

Billing software is, without a doubt, the best way to yield the most accurate claims. Medical insurance billing software automates the process from start to finish, reduces errors, and makes for a simpler process overall. A seamless medical billing process is achieved every time with the help of these features:

Bill thousands of payers from a single platform

You’re likely dealing with dozens of different payers at your practice, so you need a system that can simply jump from one insurance company to the next. A platform with this capability gives your company the opportunity to work with a wider variety of patients. 

24/7 support

If you don’t have software at your practice, you might not realize how important 24/7 support truly is. Take our word for it—you’re going to want access to an expert support team whenever you have a question. Software is designed to make your job simpler, but that doesn’t mean it’s without its challenges. Find a system that offers support any time so you can be sure that your questions have answers whenever you need them. 

Error check 

If you want to be sure you don’t submit any errors during the billing process, you need software with an automatic error check. Error checks automatically review every claim before it’s submitted, so any errors that may have gotten through can be detected before they’re found by the insurance company. Error checks add an extra layer of protection, so if any errors are present, they can be quickly amended so you don’t fall behind. 

Intelligent reporting

Custom reports are an invaluable tool, as they let you sort and review your data in one place. Billing software with custom reporting tools lets you create custom reports containing specific data that you need sorted, in whatever format is best for your team. Reports are generated in just minutes and can be shared with your company for collective improvements. 

Take control of your billing with the right software

Whether you’re billing with a PPS model or with other methods, you need the right system to make sure your billing is top notch. Finding the right billing system can be tedious, so we’d love to show you our system in action for free. If you’re interested, get in touch with our team to book a demo today! 

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