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Outpatient rehabilitation clinics from Sioux City to Dubuque have dealt with major billing issues resulting in stacks of unpaid or incorrectly paid claims since the April 1 handover of the state’s $5 billion Medicaid program to three private insurers.
“We are 11 weeks in. This is bringing us to our knees,” said Dan Britt, an administrator at Northern Iowa Therapy, a Waverly-based agency with about 150 therapists who provide speech, occupational and physical therapy services throughout Northeast Iowa.
Britt said a conference call with other rehab clinics across the state earlier this week that two managed-care organizations — UnitedHealthcare of the River Valley and Amerigroup Iowa — were paying providers incorrectly or were not reimbursing claims at all.
“But we need to get this resolved soon,” Britt said. “We can’t go another 11 weeks without payments. We will have to make tough decisions.”
The problem, multiple providers told The Gazette, is that incorrect billing codes and fee schedules are being applied — a problem UnitedHealthcare has said it corrected and Amerigroup has acknowledged is happening.
However, there isn’t a firm timeline as to when those corrections will take effect and claims will be reprocessed, providers said. The issue is forcing at least two rehab centers to dig deep into their savings.
“We’re not even getting half of what we got with Iowa Medicaid,” said Jessica McHugh, owner of AbleKids Pediatric Therapy in Sioux City, referring to when the state handled Medicaid reimbursements.
The occupational, physical and speech therapy provider has about 270 visits each week, and up to 80 percent of the children they treat are on Medicaid.
An Amerigroup provider representative in McHugh’s area described the incorrect therapy service codes as a “global issue,” McHugh said, meaning all providers are dealing with a similar issue. The company told her that it will reprocess and pay claims once the problem is fixed.
Dionisia Malecki, an Amerigroup spokeswoman, said Thursday that the company is working to fix these issues.
“Amerigroup Iowa is dedicated to paying all of our providers accurately and timely. We were made aware of the AbleKids concern yesterday (Wednesday), and we are working with them to investigate and resolve any issues,” Malecki said. “We welcome input and collaboration from any provider who may have questions or concerns. As we have demonstrated in the past, we are committed to transparency and quick resolutions.”
She was told similar issues with UnitedHealthcare have been fixed and will be reprocessed. But the facility still has unpaid UnitedHealthcare claims stemming back to January, she said.
UnitedHealthcare paid for Hawk-i services — health care for low-income children — before the transition, along with Des Moines-based Wellmark Blue Cross and Blue Shield. Wellmark’s contract ended Dec. 31, 2015, and UnitedHealthcare was in charge of all Hawk-i claims until the April 1 transition took place.
McHugh started tightening the clinic’s budget last summer, putting aside money in anticipation of billing problems. Those savings are now helping her pay staff and keep the lights on.
“I’m really glad I did,” she said. “The man hours we’ve put into this — my billing manager is overworked and has a stack of claims piling up on her desk. What do we do with them?”
Meanwhile, Sarah Sievers, director of business operations and development at Dubuque-based Unified Therapy Services, said that organization still is owed about $80,000.
“Payroll is due Friday,” she said. “My supervisor comes to me and asks, will we have that money? And I have to say no. We have sent in thousands of claims, and they are being paid incorrectly.”
The clinic has run into a host of problems, Sievers said, including:
• About 92 percent of Unified Therapy Solutions pediatric clients are on Medicaid, and some parents have yet to receive insurance cards
• Two MCOs sent the organization the wrong contracts originally
• AmeriHealth Caritas Iowa, the only MCO to reimburse the clinic properly, sent a $40,000 check to a Nebraska address twice.
But Unified Therapy Services’s biggest headaches by far are these improper codes and fee schedules leading to incorrect payments, Sievers said.
In anticipation of these growing pains, the clinic’s owners saved enough money last summer to keep operations running for up to three months of no payments, she said, but if the problem isn’t corrected soon, it may have to take out a loan.
Because of all these problems, Sievers questioned if proper testing took place.
“We were in such a rush,” she said of the managed-care transition, which initially was scheduled to take place on Jan. 1. “But what’s missing was the testing of claims and reimbursements. I think it will all settle down and get fixed. But lack of payment is not acceptable.”