I hear it every weekend from new graduates to veteran chiropractors who have been working in the trenches for more than 20 years. They are tired of all the red tape and regulations that make them feel as if they must choose between quality patient care and hours of paperwork to stay compliant. Who wouldn’t want to have less restrictive documentation requirements, eliminate the risks of audits, see more patients, and have the freedom to charge what you want? But are these true benefits of running an all-cash practice?
Documentation Requirements
Contrary to popular belief, running an all-cash practice does not eliminate the necessity of properly documenting a patient’s visit. In fact, most boards of examiners have rules requiring you to document a patient’s visit properly, cash or not. If your board of examiners requests patient documentation and finds that your notes are lacking, it can cost you. One doctor found out the hard way last year when a review of her medical records by her board of examiners found that she had provided unnecessary services not justified by documentation, including but not limited to no complaints or objective findings for areas treated and no times entered for timed services. Her license was suspended for two years, and she was required to enroll and successfully pass all sections of Ethics and Boundaries Assessment Services (EBAS). She also had to attend no less than eight units of one-on-one continuing education on proper documentation by a board-approved provider, which could not count as CE requirements for license renewal. Additionally, she had to arrange for an independent monitor to conduct quarterly reviews of her standard of care, billing practices, and healthcare documentation. A report from the monitor must be submitted to the board quarterly.
...around 80% of their clients are charging less than what insurance would allow and, as a result, are losing thousands of dollars a month.
See More Patients
In 2016, the Henry J. Kaiser Family Foundation reported that 91% of the U.S. population had some form of health insurance coverage (Henry J Kaiser Family Foundation, 2016). With healthcare costs rising over the past decade, it is a huge expense for most families. Thus, many of them are reluctant to spend additional money to see a provider outside of the insurance system. With only 10-15% of the U.S. population seeking chiropractic care regularly, this can narrow the pool of patients coming into your office significantly (Gallup-Palmer College of Chiropractic Inaugural Report, 2015). In an independent survey, we conducted a few years ago, 79% of insured patients stated that they would choose an in-network provider over an out-of-network provider.
Another drawback to an all-cash practice is the restriction of no longer seeing federally insured patients. The six major government health care programs—Medicare, Medicaid, State Children’s Health Insurance Program (SCHIP), Department of Defense TRICARE and TRICARE for Life programs (DOD TRICARE), Veterans Health Administration (VHA) program, and Indian Health Service (IHS) program— provide healthcare services to about one-third of Americans. Currently, 44 million beneficiaries—some 15% of the U.S. population—are enrolled in the Medicare program alone. Enrollment is expected to rise to 79 million by 2030. (AARP, 2009)
Freedom to Charge What You Want
I get it! Reimbursements are down, but according to consultants, around 80% of their clients are charging less than what insurance would allow and, as a result, are losing thousands of dollars a month. Worse, recently, a member of my team helped a doctor determine his cost of doing business only to discover that he was losing $10 a visit and falling into a deep hole. His issue wasn’t lowering reimbursements. He had not evaluated or changed his fees in over a decade. The cost of living has gone up 20% in the past decade, which is why we need to evaluate our fees annually to be sure they are not only covering our overhead but also that we are charging market value. (Picchi, 2020)
I know how you feel, and I have been where you are. Multiple times throughout my more than 30 years in practice, I thought about throwing my hands up and switching to a cash-based model. I changed my way of thinking when I realized that much of the revenue flowing through my practice was, in fact, from insurance patients that became cash patients over time. Accepting insurance provided an entryway for more new patients. Eliminating insurance completely from your office can be done and is done successfully by some, but be clear, it is not for everyone. You see, insurance coverage is diminishing and is, in many cases, non-existent for patients with high deductibles. However, most of us need the “traffic” of potential new patients. A patient hearing over the phone that you do not accept or file any insurance can be a deal-breaker for them, despite the fact that they may schedule. Through a thorough financial report of findings (FROF), you can educate patients on what insurance will and won’t cover and present them with options that make care affordable while still keeping your practice compliant. It doesn’t have to be all or nothing. It’s really about finding balance.
Dr. Ray Foxworth is a certified Medical Compliance Specialist and President of ChiroHealthUSA. A practicing Chiropractor, he remains "in the trenches" facing challenges with billing, coding, documentation and compliance. He has served as president of the Mississippi Chiropractic Association, former Staff Chiropractor at the G.V. Sonny Montgomery VA Medical Center, and is a Fellow of the International College of Chiropractic. To request a free one-page financial policy, send an email to [email protected].
