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Paduda: Those Damn Facility Fees

  • State: Pennsylvania
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If you are a work comp payer, you don’t have to pay those ridiculous facility fees when care is delivered outside the hospital — at least not in Pennsylvania.

Joe Paduda

Joe Paduda

That’s the decision rendered by the Pennsylvania Bureau of Workers’ Compensation in a case dating back to 2017. The case arose when a hospital (which I promised not to identify) tried to get reimbursed for care delivered by an affiliated provider that was not “located within XXX hospital.”

The details

The hospital, a Part A provider and billing entity,” didn’t provide the billed services. Rather, a “Part B provider whose clinic [was] not located with[in] XXX hospital performed, billed and was reimbursed for services. XXX hospital is not entitled to payment, as XXX hospital provided no medical services.”

The actual provider, a “Part B provider” affiliate of the hospital, delivered the services, submitted a bill and supporting documentation, and was reimbursed.

The hospital also submitted a bill along with documentation that the treating provider had a professional services agreement in place with the hospital.

Notably, the PSA “designates that all care and treatment is rendered by [the affiliate’s] personnel; therefore, the payer’s attorney questioned exactly what XXX hospital was “providing.”

There’s a lot more to this; location codes, provider details, Medicare regulations, bill types and the like are all important. The knowledge level required to correctly reimburse and successfully uphold a denial of payment for facility fees in Pennsylvania is quite impressive; the entity providing that expertise has a wealth of experience and expertise in the Keystone State.

The cost reduction is equally impressive.

What does this mean for you?

If you are paying facility fees for care delivered outside of a hospital (Part A) provider, you better get your act together.

Expertise is way more important than price or throughput.

Joseph Paduda is co-owner of CompPharma, a consulting firm focused on improving pharmacy programs in workers’ compensation. This column is republished with his permission from his Managed Care Matters blog.

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