Revenue integrity is a big deal in health care. It always has been, but it’s become a type of meme, the buzzword in the industry over the last few years. It should have always been a target of health care providers; it’s always been one of mine. Luckily, it’s something that you read about more often; why?

aspirin
Tom Magliery via Compfight

Once health care coverage became part of the national conversation, people started complaining more about its cost. Sure, health care is expensive, but what are lives actually worth? Complaining about the cost of health care seems a bit ridiculous…

Seems, that is, until you take a look at some of the types of things I’ve seen, and that patients have complained about over the years.

You know those stories that show up on the news every once in a while where a person was charged $800 for aspirin? What about $100 for a tongue depressor? Yup, I’ve seen those; not only is it unethical, but it shows those hospitals have no idea what they’re doing; yeah, I said it!

Why would a hospital charge $800 for aspirin? What happens with many supply or pharmaceutical items is they’re purchased in bulk.

A hospital might purchase a case of aspirin at a time, and let’s say that case costs $100. Every person who touches that bottle in the hospital knows that the cost of each bottle is only a dollar. The markup policy for items under $25 might be 800%; that sounds steep but retail does the same thing with a lot of its low cost items. The idea is that if it cost the company a dollar, they want to see what profit margin they can get from the consumer.

So, 800% for a dollar item isn’t all that bad. Except there are two major problems here.

The first is that, instead of applying the markup to each individual bottle, the markup was applied to the cost of the case. That’s the only one someone can justify charging that much for that type of item. It’s lazy and unethical; it’s hard to believe that not a single person even thought to question it, let alone push it through.

The second is that most low cost items aren’t actually billable, whether they’re pharmaceuticals or supply items. For instance, aspirin is considered an over the counter product. No matter its cost, hospitals aren’t supposed to bill patients for over the counter medications. It can be considered fraudulent; if you don’t believe me ask Medicare, because if you send them a bill for aspirin, they’re going to log it and, at some point, here comes the audit.

There’s tons of items patients aren’t supposed to be billed for that are known as routine supplies. These are items that hospitals, doctors, clinics and whomever else is in health care needs to use in order to provide services. Some examples are:

* needles to inject or draw fluids from the body; band aids; gauze; alcohol; tongue depressors… things like that

* blankets, drapes, sheets, pillows, covers on equipment, equipment…

* slings, most splints, physical therapy items like balls and weights, scalpels…

I think you get the drift. True, not all of those things above are inexpensive, but if it’s needed, disposable or not, they’re supposed to be nonbillable.

That touches upon the subject briefly. For a bit more, please check out the video below:
 


https://youtu.be/OWTMxQ811w8

 

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