A model to increase trauma reimbursement in the private practice environment

Area of Science:

• Healthcare Administration
• Trauma Surgery
• Health Economics

Background:

• Trauma physician reimbursement models vary, with academic/employed models common, but private practice is also utilized, particularly in community settings.
• Commercial insurers recognize the need for higher trauma care reimbursement but struggle to differentiate it from elective care.
• Federal regulations restrict shared negotiation for non-integrated groups, impacting reimbursement strategies.

Purpose of the Study:

• To develop and evaluate a private practice billing model designed to enhance reimbursement specifically for the trauma care line of business.
• To address the challenges faced by trauma centers in securing adequate compensation for critical care services.

Main Methods:

• A dedicated trauma contracting organization was established to negotiate contracts with hospitals and insurance companies for trauma care delivery.
• This organization secured fee schedules for trauma services exceeding those for elective procedures.
• Contracts were established with trauma physicians, utilizing the organization's provider number and specialized fee schedules.

Main Results:

• Reimbursement rates for self-pay and government carriers (Medicare, Medicaid, Champus) remained consistent across both the new model and standard practice.
• Commercial carriers demonstrated increased reimbursement for trauma care, averaging a 7% to 10% higher return on charges.
• The model resulted in an annualized increase of over $300,000 in reimbursement on more than $5,000,000 in charges.

Conclusions:

• The developed model offers a viable strategy for improving trauma care reimbursement within a private practice framework.
• This approach can help trauma centers achieve greater financial sustainability by optimizing billing for critical care services.