So, your owners have come to you and asked you to research a new service line. Or maybe they’ve asked you to start a new service line after someone, somewhere, told them it would make money or bring in more patients. Before you launch, I strongly suggest you do your research, understand your potential return on investment, and present your findings to the owners.
How do you do this? First, you need to determine what procedures (CPT codes) you’ll be performing and who can perform them. If the provider who brought the proposal to you knows, great! If not, let the fun begin… Reach out to your colleagues and see if they know. A great resource would be your local or national Medical Group Management Association or AAPC. These professional associations have great networking resources and can help get you started.
Now that you have your list of CPT codes and a list of who can perform these procedures according to the AMA CPT code book, you need to find out whom the insurance companies will actually pay for. Remember, just because the AMA says that a nurse can do it doesn’t mean that a major insurance company will reimburse them to do it. So, you’ll need your billing staff to call your top three insurers and find out the reimbursement for the codes. You may need to come up with a few sample ICD-10 codes to go with the procedures to get an accurate estimate. Additionally, you’ll want to know if pre-authorizations are going to be required.
Say you know that when it comes to the procedures that you want to perform, the insurance companies do not require prior authorizations but they only will reimburse for MD/DO. Now it’s time to look into the supplies needed for these procedures. As you do this, determine if you have these supplies already in stock, or if you need to purchase them. Also ask yourself: will your current exam room setup work or will you need new equipment and/or machines? You may also find that the necessary medications or instruments require the provider to take a special course or obtain certification. Take this into account, as this may mean that the provider in question may have to miss clinic to gain this knowledge. That missed time is an additional cost.
Now that you know reimbursement rates and costs, you just need to:
- determine your fees (based on your current fee schedule algorithms),
- decide how you to schedule these appointments,
- determine whether you need to hire a new provider or use a current provider, and
- figure out how long it may take to start providing these services.
Once you have these last bits of information, you can start to calculate the cost of investment and the anticipated return of this new service line. Keep in mind that most new services lines take at least 3 months to work up to full capacity.