Why Your Psychiatric Billing Still Struggles (and How to Fix It)
Discover what’s holding back your psychiatric billing and learn simple fixes to improve cash flow and reduce claim denials.
Owning and operation a psychiatric practice is gratifying and empowering, but the business part of a psychiatric practice, most specifically the billing process, can be very frustrating. Many providers find themselves overloaded with denied claims, bypassed payments, and complicated guidelines required by insurance companies. If you are in this boat, you are not alone. The psychiatric billing component of successfully maintaining and collecting revenue for your practice is one of the most difficult aspects of healthcare revenue management. The good news is that there are tools, processes, and people you can have at your disposal to mitigate these issues.
In this blog, we will discuss the reasons why the billing challenges persist, ways to address it, and why so many practices choose to partner with Billing Care Solutions for finding more ways to bill and collect payments quicker and more successfully.
Why You Might Find Psychiatric Billing Is So Overwhelming
Billing for psychiatrist services is not the same as billing for an annual physical and a gait analysis. Psychiatric coding, compliance, and documentation are quite complicated and have their own issues.
Here are some reasons practices struggles:
1. Complicated and Changing Codes:
Often psychiatrists and therapists will provide services that fall into a variety of different categories - therapy, medication management, evaluations, group, and telehealth. Each of which will require its own CPT code along with various modifiers. A client may even have a combination of the codes where they are paid less than they think with various codes being used. Using the incorrect CPT code for a service will cause a possible denial for the entire claim. For example, billing for a 45-minute psychotherapy session (90834) and a 60-minute psychotherapy session (90837) can cost lost revenue.
2. Insurance Limits on Mental Health Coverage for Patients:
For many patients, their insurance plan may have limitations on the number of sessions they can have in a year, or require a prior authorization. If you do not have a tracking system to capture these limitations, you may lose coverage for the claim.
3. High Rates of Rejection and Denial:
The denial rates for mental health claims are among the highest in the medical field.
Typical explanations include:
- Patient demographics are missing.
- Incorrect NPI for the provider
- Telehealth services with incorrect coding
- Absence of authorization paperwork
- Every rejection result in additional labor and lost income.
4. Administrative Work That Takes A Lot of Time:
Psychiatrists weren't trained to be experts in paperwork. However, instead of concentrating on patient care, many spend hours resolving billing errors, following up on unpaid claims, or navigating insurance portals.
5. Risks of Compliance:
Psychiatrists have many regulations to comply with including HIPAA, mental health parity laws, and regulations set by various payers. Even small errors and omissions (for instance, documentation is not complete for coding a medication management visit) can lead to audits or requests for refunds. The goal is to comply with the various regulations to ensure there is no penalty to you, your practice, or your patients and to protect the trust of the payers.
Ways to Resolve Common Psychiatric Billing Issues:
The first step to resolving billing issues is to identify where there are breakdowns in your billing process. Below are actionable steps to get you back on track with your billing:
Tighten your documentation processes:
Insurance payers want evidence you provided the service you billed them for. You need to train your clinicians and staff to document short-billing notes that include:
- Medical Necessity: Provide a clear explanation of why the service or procedure was necessary. This indicates to payers that the treatment was reasonable for the patient’s clinical status.
- Progress Notes: Progress notes are continuing documentation of the patient’s condition, response to treatment, and care changes. This information provides continuity of care and documentation of care.
- Prescriptions or Treatment Plans: Each prescription for medications prescribed or treatment done, to support the medical necessity and reasonableness of the services billed.
Bill with the correct codes every time:
Consider keeping a cheat sheet of the most frequently used CPT codes your practice may be billing. You should review updates on an annual basis as psychiatric codes often change. To use CPT code as an example:
- 90792: Initial Psychiatric Evaluation with Medical Services
- 90837: Psychotherapy (60-min)
- 99213: Medication Management (15 min)
Be Proactive with Prior Authorizations:
Designate a team member (or your billing partner) to monitor which patients have authorization for continued treatment to avoid the hassle of providing care, only to have the insurance deny payment.
Track Denials - and Learn from Them:
One of the most important aspects is not just submitting denials again without thinking. Evaluate any patterns. If 25% of your denials are related to telehealth, it may be time to change your coding protocols.
Invest in Dedicated Billing Support:
Standard billing services can fall short when it comes to psychiatry. Mental health has different coding and compliance rules and also there is payor idiosyncratic behavior. Working with a group that specializes in psychiatric billing can go a long way. You will save your staff time, but also because you are outsourcing to experts you will likely see reduced denials and greatly increase in collections.
Why Practices Choose Billing Care Solutions
At Billing Care Solutions, we are experts in psychiatric and behavioral health billing.
Practices choose Billing Care Solutions because we:
- Increase Collections: We cut down on denials because we submit clean claims the first time.
- Simplify Compliance: Our team takes the burden of keeping up on changing codes, payer rules and regulations off of your plate.
- Save Time: You concentrate on serving your patients while we deal with the billing headaches.
- Provide Reporting Transparency: You can always know the status of your claims and revenue.
- Customize Service: Whether you are a solo psychiatrist, or expanding group practice, we customize our services to suit your needs.
Example: A solo psychiatrist came to us very frustrated, after about 6 months of denied telehealth claims. Within 60 days of engaging Billing Care Solutions, her reimbursement rate had increased by 35%.
Fixing Your Psychiatric Billing in 5 Steps Here’s a quick checklist to get started:
- Audit your current billing system. Identify where denials and delays happen.
- Update your coding and documentation guidelines. Train staff and providers.
- Streamline prior authorization tracking. Use a calendar or software alerts.
- Set up denial tracking. Create a simple spreadsheet or dashboard to see patterns.
- Consider outsourcing to specialists. Partner with a team that knows psychiatric billing inside and out.
