Mining a New Revenue Source with Red Rock Diagnostics

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geoff LowdenDespite increased oversight, declining reimbursements, and other broadsides that have hit medical imaging over the past few years, growth opportunities are available. One commonly overlooked source of scan volume and the resulting revenue is the lien patient.

A medical lien (aka Letter of Protection or LOP) is a contract in which the health care provider agrees to treat patients who are participants in court cases, often in the personal injury classification. The provider agrees to withhold collection for medical services in exchange for a promise by the patient to compensate the provider after settlement of the case. Lien contracts usually instruct attorneys to reimburse the provider before disbursing any remaining compensation to the patient. The lien system is an established method of ensuring treatment for patients who may otherwise have difficulty finding care.

By accepting lien cases, imaging facilities across the country can usually add incremental business with little effort or risk.

Liens are an often-misunderstood program. Several misconceptions about medical imaging liens are:

1) They are not as profitable as conventional scans. This is false. Liens are usually reimbursed at prevailing rates acceptable to most imaging facilities.
2) Lien cases are reimbursed at a much slower rate than either private insurance or Medicare. Also false. Depending on the lien process, a lien may be reimbursed in as little as 15 days.
3)Imaging facilities that accept liens provide a lower quality of care. False. Because liens can be reimbursed quickly and at acceptable rates, providers do not have to cut any corners with regard to care.
4) If the case is lost, so is the compensation. False. Regardless of the outcome of the case, in most situations, the medical bills are still owed.

Accepting liens is a relatively painless endeavor, thanks in part to a handful of firms that offer lien management services. But how is one to know which service is best?

Geoff Lowden is a principal at Red Rock Diagnostics, which has been managing liens for medical imaging since 2006. To help sort through the lien process, Lowden described the challenges he often encounters when a medical imaging enterprise is considering whether to engage a lien management partner.

“The first thing we advise people to discover is whether the lien management services are performed in the United States,” says Lowden. “The changes in the business side of medical imaging—and to some extent, the professional side as well—have produced off-shoring in several areas. A domestic lien management resource is typically more responsive and provides fewer barriers to successful revenue cycle management.”

Lowden also cautioned against throwing out the baby with the bathwater. “Some radiologists and medical imaging facilities have used a company like ours in the past and were not satisfied because the lien management company did not do what they promised. To avoid liens altogether because of one bad experience is a mistake, particularly these days when scan volume is critical.”

Another barrier to the decision in favor of working with a lien management company is that the paperwork is too cumbersome and that the process hampers patient scheduling.

“There are all types of lien management horror stories out there—everything from imaging facilities having to get directly involved with attorneys to patients having to wait long periods for their scans. At Red Rock, we’re different. We work only with radiologists and diagnostic imaging facilities and because we’re so involved, we have developed a streamlined system that makes it very easy for the medical imaging profession to capitalize on the lien process. For example, through our lien program, scans do not require pre-authorization, so patients can be scheduled within a day.”

Lowden also cited a loss of control over receivables as another issue. “Through our program, we essentially buy the receivables from imaging facilities at a favorable rate. They assign them to us so once those receivables are off the books, they don’t have to worry about them anymore. Plus, they can get paid in as little as 15 days.”

Attorneys who routinely handle cases requiring medical care for their clients usually know physicians and facilities that will accept liens and will refer their clients to them. “The attorney involvement is sometimes a barrier to medical imaging decision-makers choosing to accept liens,” says Lowden. “In our case, we’ve