No Such Thing as a Free Lunch, Part One
insurance billing + WCA = ?
(The introduction to this topic is here.)
Whenever we mention that WCA runs on a shoestring budget, someone well-meaning will ask, “But why don’t you just bill insurance? Lots more people have insurance for acupuncture than they used to — including people on Medicaid. You’re a big clinic with decent systems, it seems like you should be able to handle it. Wouldn’t you make more money that way and be able to pay your staff more?”
I took a pass at this question in an earlier post but I wanted to answer it in more detail — which means that this set of posts might be really boring for some of our readers. I’m sorry about that, and I promise we will get back to more fun topics (like pop-ups) soon. POCA Tech students need to understand what’s involved in billing insurance, though, and as you’ve probably noticed, I’m also using this Substack as a place to work on my teaching notes. (Transparency! I can’t get enough of it!) And it’s important context for past and future posts about how WCA earns money.
To dig into the details, I enlisted the help of an acupuncture insurance billing consultant who wants to remain anonymous (you’ll see why). I asked them, “Can you please walk me through the insurance billing process (because I tried it once maybe 25 years ago) and then help me understand what about WCA’s operations would have to change in order for us to do it?” I’m very grateful for their time and thoughtfulness. Their answer reflects their personal experience and is specific to insurance billing in the state of Oregon; it’s not intended to be advice about how to run an insurance-based acupuncture practice in general.
As you read it, please keep in mind that WCA’s process for getting reimbursed for acupuncture is currently very simple — it’s basically “patients paying when they check in at the front desk”, “patients buying treatments online” and “partner organizations sending a monthly or quarterly check”. Okay, here goes!
Steps for Billing Insurance for Acupuncture in Oregon
1st - The patient needs to have insurance that covers acupuncture.
2nd - The practitioner needs to get credentialed with that same insurance.
To see everyone with insurance, the practitioner needs to get credentialed with every insurance that covers acupuncture in Oregon. To put that into perspective, there are 16 Medicaid plans (CCOs) in Oregon alone, and so a practitioner would need to credential (and re-credential regularly) with each CCO and Oregon Health Plan (OHP), the umbrella org for Medicaid. Plus, the practitioner would have to credential with all the private insurances like Moda, Kaiser, United Health, Regence/BCBS, etc as well. Plus, they'd need to be credentialed with Medicare (for those over 65) plus all the Medicare supplemental plans. Most Medicare plans won't cover acupuncture.
3rd - The patient goes to the credentialed provider (provided they can get an appointment) and gets acupuncture.
4th - The practitioner takes extensive notes (no simple SOAP notes here), being careful to use at least one billable code that's considered "above the line" -- usually back pain, neck pain, something like that. If the practitioner doesn't chart extensively enough or uses only codes "below the line," the visit won't get reimbursed. If the patient's insurance requires a Prior Authorization (PA), the practitioner will have them fill out something called a "Keele Start Tool" that has them agree/disagree with statements about their pain and asks them to rate their pain on a numeric scale for different activities. Only certain types of pain (above line codes) with certain ratings get PAs approved.
5th.a - The patient checks out of the clinic, and pays a co-pay (unless they are a Medicaid patient). The front desk or admin person will have verified this patient's insurance benefits, and been told by a representative or online portal how much to charge them in the form of a co-pay upon check out. The patient might have a deductible though, or co-insurance, in which case the practitioner/clinic will need to send that patient a bill for those charges after the fact.
5th.b - (conditional) Depending on the patient's insurance, the practitioner or staff at their clinic will then need to submit the PA, complete with chart notes, Keele Start Tool, proposed CPT codes (codes for performing acupuncture) and above line diagnosis codes. PAs can take up to 30 days to approve, during which time the patient cannot get acupuncture. Only once the PA is approved, can the patient return to the provider to get a 2nd acupuncture appointment. Sometimes insurance companies want progress notes after 5 or 6 visits to show improvement on the above line diagnosis. They may or may not approve more visits if the chart notes show progress. There’s usually a waiting period of 6 weeks (while the patient can’t get treated) while the insurance company decides.
6th - The practitioner submits their chart notes and diagnosis codes to the biller (or some might do this process themselves). The biller submits the chart notes/diagnosis codes/patient's demographics + member ID to the insurance company for payment, usually through an online portal.
7th - A few weeks later, the insurance sends the provider/clinic back an Explanation of Benefits (EOB). The patient also receives an EOB. The EOB lists the cost of the patient's care, what the provider's charges are/what services they're billing for, and how much the insurance company will pay, along with *sometimes* a brief summary (like 2 words) of why something isn't paid, say, "Non-covered service" or "No PA." “Provider Charges” is the amount the provider bills for the patient's visit. “Allowed Charges” is the amount the provider will be paid, this is often not the same amount as the provider charges, and most providers charge about double their cash prices to insurance. For example, a clinic might bill insurance $305 for an acupuncture visit while the cash price for an hour long acupuncture session might be $150-190 depending on the type of appointment.
8th.1 - If all is well, the biller then goes into the portal with a special code the insurance company has sent on the EOB, logs in, and requests to transfer the money to the clinic's account. This must be done for each insurance company pay out separately.
8th.2 - If the biller/provider disagrees with the EOB and payout amount (this happens often), they must call insurance to open a dispute or re-submit the claim with amended codes, etc. If the biller/provider wins the dispute, the insurance company will issue amended payment, within 90-120 days (however, disputes can go back and forth for months or years). If not, the (cash) price of the visit gets transferred to the patient by the provider. If the patient does not pay, the clinic either eats the loss or sells the balance to collections.
8th.3 - If the patient has co-insurance or a deductible, the EOB triggers the biller/provider to bill the patient the stipulated amount.
An additional note about how acupuncture reimbursement works in Oregon: a number of insurance companies require acupuncturists to get credentialed through Third Party Administrators (TPAs) who are essentially the administrative middle man between providers and insurance. The TPAs take around 60% of what insurance pays the provider for the service. So in this circumstance, if an acupuncturist bills a patient's insurance $150 for acupuncture, and the insurance agrees to pay $100, the acupuncturist is actually making $40/treatment after the TPA gets their cut.
I have to be honest with you that most people hate dealing with insurance because it’s seemingly intentionally confusing and stressful.
Everyone, from patients to providers to billers to the insurance company representative on the customer service phone line, is usually confused, stressed and scrambling to not get themselves in trouble. There's even an auto-recording before you can get through to the customer service representative stating that "the benefits of the plan outweigh any information -- correct or incorrect -- you may get from the representative” — in other words even what the representative tells you might be wrong because it's so confusing! It’s rare to get an actual straightforward answer.
For example, someone might "have Kaiser" insurance, which a provider might "take". But are their benefits self-referred? If not, they'll need a PA from their Kaiser-appointed PCP (notoriously hard to get) on file with the provider before having an appointment. If they're "self-referred," they can see an acupuncturist BUT that acupuncturist will be considered out of network (aka not-Kaiser) and the reimbursement they’ll receive is minimal. Most clinics will charge patients the difference ("Cash payment for non-covered services," usually around $35-80) plus the co-pay ($15-55). So, a patient could "have acupuncture benefits" and "have insurance coverage" and the provider could "take that insurance," but the patient could very well be walking out of that appointment still paying $50-135 for acupuncture out of pocket.
I know how strongly you feel about financial transparency and “no surprises, no pressure” so you need to understand that insurance billing isn’t like that. At all.
A patient in pain could be waiting a month or two after their initial intake to get more acupuncture because the acupuncturist has to wait on their Prior Authorization to come through. A patient could be cut off from the care they’ve been receiving because they switched jobs or got laid off or otherwise lost their insurance coverage. A patient can get hit with a giant surprise bill at any moment — triggering feelings of financial scarcity or causing financial distress — and then decide they’re done with even seeking care at all.