Professional Documents
Culture Documents
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Richard Kaplan
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Greg J. Lamberty
Jerry Sweet
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vi Acknowledgments
Introduction
On the surface, the premise of this text may seem peculiar to neuropsychol-
ogists who are accustomed to reading books designed to provide insight and
information to enhance clinical practice. Graduate school catalogs and
training program brochures reveal a broad array of educational opportunities
designed to prepare future professionals for independent practice in neurop-
sychology. However, little is offered to prepare neuropsychologists for the
business realities that await them in the workplace. The expectation that they
will simply see patients and do quality clinical work is often constrained by
institutional goals of making money so that the doors can remain open. The
result can be a cataclysmic ‘‘crash’’ when altruistic ideals meet capitalistic
needs. The concepts of ‘‘cash is king’’ and ‘‘no margin, no mission’’ are foreign
to most neuropsychologists until our own fiscal bottom line is affected. It is
that reality – our own fiscal bottom line – that sets the stage for this text.
During the preparation of this text and the CEU presentation at the AACN
conference in Boston, MA in 2008, I had commented to colleagues that I was
concerned that the basic business theories and ideas presented in this book
would be less than intriguing to neuropsychologists. I assumed that the
popularity of the presentation and this subsequent text would lie in the
fiscal aspects of the information rather than the process that gets us there. I
had planned several Tom Cruise ‘‘Show me the money!’’ lines to try to keep
audience and reader interested, but these colleagues advised against this,
stating that it would not be necessary. They assured me that the ‘‘how to get
there’’ aspect was going to be just as popular as the ‘‘where do we go from here.’’
I must admit that they were right. The positive comments I received following
the AACN presentation focused much more on the ‘‘process’’ aspects of my
presentation and less so on the ‘‘profit.’’ To this end, this text will take on a
similar approach to that noted in the initial workshop.
The purpose of this text is to provide an overview of basic business
principles and how they can be used to enhance the stability and fiscal
responsibility of neuropsychological practice. The principles discussed are
presented in a fashion that will include an overview of concepts as well as a
practical approach to promote application of the information. It is designed to
benefit professionals at varying levels of practice regardless of their work
setting, but focuses primarily on the issues related to neuropsychological
practice. Additionally, administrators that oversee neuropsychological prac-
tice may find this text useful to gain a better understanding of the interaction
between clinical activities and the fiscal responsibility of their department. The
reader will be exposed to a variety of basic business principles in a way that
will increase understanding of business process and system variables asso-
ciated with the practice of neuropsychology; basic budget and fiscal tracking
abilities; and communication strategies that are helpful in conveying depart-
mental information effectively to internal and external stakeholders.
Additionally, practice development and organization needs are discussed,
including the basics of front and back office flow and processes; accurate
and consistent billing, coding, and documentation activities; marketing and
referral relationship development; and staff growth and development. Issues
related to balancing the needs of training programs with fiscal responsibilities
of departments are presented briefly along with some other threats to the fiscal
bottom line. The text closes with discussions of professional roles based on the
professional’s level of experience.
The text is divided into three sections. After initial chapters present some
basic business principles and system processes that are applicable regardless
of setting, the second section focuses on applying the business principles
within the practice of neuropsychology. Where applicable, differentiation
between private and institutional settings is delineated along with specific
issues related to private, institutional, and government-based settings.
Throughout this text, there is an emphasis on applying a ‘‘private practice’’
model to the various settings in an effort to promote consistency and fiscal
responsibility, regardless of setting. Many chapters include practical examples
and tools to provide easy application of the information presented. The final
section of the text focuses on issues related to professional development based
on level of experience in the field of neuropsychology. Within this section
there is information for new professionals focusing on securing their first job,
including tips on professional development. The chapter aimed at the more
experienced neuropsychologist’s professional development includes a discus-
sion of increasing financial stature, diversifying practice referrals including
medico-legal sources, professional diversification, consideration of adminis-
trative roles, and end-of-career issues.
The goal of this text is to provide a unique resource to bridge the gap
between clinical practice and institutional/practice demands. As the
viii Introduction
economics of psychological and neuropsychological practice are being nega-
tively impacted by changes in reimbursement, new (and not necessarily
improved) rules for billing and documentation, insurance reimbursement
reductions, national economic trends, hospital budgetary strains, and compe-
tition from within as well as outside professionals, the need for greater under-
standing of business principles has become essential. This is demonstrated
through the growing popularity of lectures, seminars, and other educational
opportunities that touch on these issues at local, national, and international
conferences. Similar presentations are consistently well-received, demon-
strating the broad interest in this area as financial and business demands
creep into clinical practice. While the idea of learning business concepts
may seem daunting to many neuropsychologists, it is hoped that the informa-
tion provided in this book is presented in such a way that it is easily under-
stood and more importantly, applicable in daily practice. In essence, it is
designed to ease the pain of acquiring new concepts and stimulate a desire for
further learning by providing information in such a way to promote an easy
transition from knowledge to action.
Introduction ix
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Contents
Index 217
xii Contents
PART ONE
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3
aspects of this broad definition are included in the discussion. For now, let’s
hold on to that ‘‘definition’’ and get down to business.
Hospital-Based Structures
The business structure of hospitals can be quite complex, the details of which
have been the subject of books, chapters, articles, etc. in their own right (e.g.,
Barocci, 1980; Barton, 2006; Burns, 2005; Griffith & White, 2006; Kovnar &
Knickman, 2008). For the purposes of this text, discussions are limited to the
issues of ‘‘for-profit’’ and ‘‘not-for-profit’’ (nonprofit) status and psychologist
structure within hospital settings.
To a large extent, hospitals are licensed as either ‘‘not-for-profit’’ or ‘‘for-
profit.’’ The terminology is somewhat misleading in that this implies that the
former is an organization that is not in the business of making money. This
could not be further from the truth. If any business truly does not have some
• What do we do?
• For whom do we do it?
• How do we excel? or How do we do it better than everyone
else?
These goals, too, were built upon earlier goals set forth in March of 1958
when the Ballistic Missile Division proposed an 11-step program aimed at the
ultimate objective of ‘ Manned Space Flight to the Moon and Return.’’ The steps
included instrumented and animal-carrying orbital missions, a manned orbit
of Earth, circumnavigation of the Moon with instruments and then animals,
instrumented hard and soft landings on the Moon, an animal landing on the
Moon, manned lunar circumnavigation, and a manned landing on the lunar
surface. Ultimately this was summarized through the ‘‘Man-in-Space’’ program
that would be carried out in four phases (goals):
1. Man-in-Space Soonest
2. Man-in-Space Sophisticated
3. Lunar Reconnaissance
4. Manned Lunar Landing and Return
History indicates that these goals and objectives were met and the ultimate
mission was completed.
The above statements, while being well-written, are quite lengthy and
complex, making it difficult to understand the specifics relating to the vision
and mission of the hospital system. In contrast, the following example pro-
vides the strategic planning information for Baylor Health Care System in
Dallas, TX (available at www.baylorhealth.com):
Our Vision: To be trusted as the best place to give and receive safe,
quality, compassionate health care.
Our Mission: Founded as a Christian ministry of healing, Baylor
Health Care System exists to serve all people through
exemplary health care, education, research, and community
service.
Our Objectives:
• The highest level of clinical care for patients across the lifespan
• Excellence in education and training for interns, residents, and
the community
• Enhancement of patient care by generating and implementing
innovative research
• Using the latest research and technological advances in the
practice of psychology and neuropsychology
This ‘ departmental’’ mission could then be used to develop specific goals and
objectives for each employee to guide the performance appraisal process and
identify key elements of performance that promote the mission of the department,
as well as the larger mission and vision of the hospital and ultimately, the hospital
system. The idea behind this more local mission statement is to create a level of
understanding and buy-in that results in individual employees understanding
how their job and their performance directly relates to the larger mission.
A great example of this is a service department such as housekeeping. What do
you think housekeeping has to do with the vision and mission statements described
above? Think about the number of infections that occur within a hospital setting.
Think about the recent increases in methicillin-resistant Staphylococcus aureus
(MRSA) infection in hospitals across the country. Now consider the role of house-
keeping in minimizing the number of infections in a hospital setting. As another
example, the perception of whether or not a hospital is ‘ clean’’ has a strong influence
on a customer’s perception of the quality of a hospital. Combine these examples
with basic customer service, timeliness, attitude, appearance, and other staff
Once the strategic plan is set, subsequent efforts can focus on the meat and
potatoes of business. Strategic planning describes what the business aims to do
and what values will guide the process in a general sense. The business plan is
designed to lay out the specifics of the plan. The purpose of the business plan is
to identify the details of how things will come together as well as the overall
feasibility of the idea. It is designed to provide the key elements of the business
in a single document, including identification of the products or services that
will be sold, the costs associated with the generation of goods or services, the
number of ‘ sales’’ expected, and projected revenue associated with this process.
The business plan is a tool to predict the future of a business and as Yogi Berra
said, ‘ It is hard to make predictions – especially about the future.’’ These words
may seem simple, but it is easy to lose sight of this fact as we dream about our
future success. It has been said that the best predictor of future behavior is past
behavior, but what do you use to predict the future when there is no past
behavior? It is hard to make predictions without a history, and in those cases it is
crucial to obtain the best possible information to make an informed forecast of
future events. Therein lies the value of developing a good business plan.
Two basic goals drive the development of a good business plan. First, a
good plan describes the fundamentals of the business idea based upon the
strategic plan. The specifics of the business and how goods and services will
be generated, marketed, and passed on to consumers are outlined. Second, a
business plan provides financial calculations and projections to show
whether or not the endeavor will be profitable and to gauge the potential
for success. The development of a business plan provides an opportunity to
examine the costs and benefits of a business and to make changes as
23
necessary to maximize the potential for success. Additionally, a strong
business plan improves the likelihood of success if there is a need to
approach a lender or investor for start-up capital to start a business.
Sometimes the development of the business plan may show that the potential
benefit is not worth the cost and subsequently the business does not move
forward and potential failure is avoided. There is no guarantee for success of
any venture, but proceeding with an informed plan based on strong data
improves the chances for success.
Developing a business plan is not particularly difficult, but it does require
patience, open-mindedness, flexibility, staunch realism, disciplined thinking,
and dedication to the process. The process of creating one often brings up
issues and potential problems that may not have been initially apparent and
may result in a need to modify the plan in a variety of ways. A disciplined and
realistic approach to developing the business plan is important when financial
aspects are considered. Developing financial forecasts and projections often-
times can be disheartening, but identifying the financial limitations prior to
beginning a business allows the opportunity to make necessary changes to
make the plan realistic and fiscally responsible.
Numerous resources are available to direct the development or revision of a
business plan, many of which include computerized templates that guide the
description of the business and spreadsheets to ease the calculation of various
financial documents (see references and resources at the end of this chapter).
While helpful, these resources do not eliminate the need for good planning
and research, disciplined reporting, realistic projections, and flexibility in the
approach to setting up a business plan. It should be remembered that the
output of these templated programs is only as good as the data that is entered.
This chapter provides the basic elements of developing a business plan,
including some nuances related specifically to the practice of neuropsy-
chology, but the reader is encouraged to seek additional assistance as they
embark on this endeavor. While numerous sources were reviewed for this text
and information from a variety of references is included, the business plan
development model presented here is based on information found in Nolo’s
The Small Business Start-Up Kit by Pakroo (Table 2006). Where possible,
information specific to the practice of neuropsychology is presented as it
relates to the development of a business plan. The reader is also encouraged
to read Edward Peck’s chapter on the business aspects of private practice in
clinical neuropsychology found in Lamberty, Courtney, and Heilbronner’s
text The Practice of Clinical Neuropsychology (2003).
Each section does not need to be lengthy or complex, but should be compre-
hensive enough that the reader has very few additional questions to be
answered. Also, the information should be presented in a concise and cohesive
manner that is easy to read and understand.
Analysis of Competitors
Now that a marketplace and need have been identified, it is necessary to
analyze the competition from other businesses in the targeted area. If the
idea is so strong that it seems ripe for success, others may also have had similar
ideas and may already be providing the identified goods or services.
Additionally, others may be looking to start a similar venture in the targeted
area, furthering a potential lopsided supply/demand equation. This section of
the business plan is used to explain why the market is able to bear the addition
of the proposed business and how it will be able to secure sufficient market
share for success. Competitors’ strengths and weaknesses need to be detailed,
and where possible it is necessary to identify how your business will differ in
such a manner that you will be better able to meet the customers’ needs. This is
best accomplished by imagining that you are a consumer comparing your
business to the competitor’s and identifying the factors that are most impor-
tant in deciding which business to patronize. Some aspects to consider include
quality of services, access and convenience, reliability, customer service beha-
viors, and price.
In neuropsychology, major factors that affect referral streams include, but
are not limited to, timeliness for access, timeliness of report turn around,
usefulness of reports, patient’s perception of the service after the fact, and
acceptance of patients with a variety of payment sources. While as a profes-
sion, neuropsychologists may view prestige, board certification, and pub-
lications as markers for a qualified neuropsychologist, our consumers
oftentimes do not understand or even care about these concepts and instead
are looking for a provider that is recommended to them by physicians,
friends, or family. As a result, customer service factors cannot be emphasized
enough when you are looking at developing your business and comparing
it to the competition. Think for a moment about the neuropsychology
Marketing Strategies
A marketing strategy is simply a plan of how a business lets the target
customers know that it exists and how the business is able to provide
goods and services in the best way for the consumer. The idea is to reach
the largest number of targeted consumers with the least amount of cost. The
focus needs to be on the identified consumer groups described in the
marketplace section of the business plan, rather than a generalized mar-
keting strategy that may waste time and resources. There is no perfect
marketing strategy, but whatever methods are planned, they should be
presented as a well thought out plan along with an explanation as to why
they will be effective.
Marketing strategies and business development specific to neuropsy-
chology are discussed in greater detail in Chapter 9. Briefly, in developing
the marketing section of a business plan for neuropsychology, remember that
neuropsychology is defined as a specialty practice and marketing efforts
should be targeted at identified patient populations. Since patients typically
Break-Even Analysis
A break-even analysis identifies the point at which the income from a business
just covers the anticipated expenses. It serves to provide a snapshot of the
business’s potential for profitability. It allows for adjustments to be made on
both sides of the equation in an attempt to improve the probability of a
profitable venture, but any such changes should be rational and based on
realistic information. ‘‘Fudging’’ the numbers to make the business look more
profitable will result in inaccuracies across all subsequent predictions and
only serve to mask underlying risk. Break-even analysis depends on the
following variables: the fixed and variable production costs for a product,
the product’s unit price, and the product’s expected or projected unit sales. It
is a tool to calculate the point where sales volumes are sufficient so that the
• Fixed Cost: The sum of all costs not directly tied to the
product that is generated (e.g., rent, utilities, administrative
services, most salaries). This amount does not vary as unit
numbers increase or decrease. This is also known as
‘‘overhead.’’
• Variable Cost: Costs that vary directly with the production of
each unit of an item or service. These are also called product
costs, costs of goods, or costs of sale. These include packaging,
supplies, materials, and labor costs associated with each
product unit. Theses costs vary directly according to the
number of units produced.
• Expected Unit Sales: Number of units of the product or
service projected to be sold over a specific period of time.
• Unit Price: The amount of money charged to the customer for
each unit of a product or service.
• Total Variable Cost: The product of expected unit sales times
variable unit cost.
• Total Cost: The sum of the fixed cost and total variable cost for
any given level of production.
• Total Revenue: The product of expected unit sales times unit
price.
• Gross Profit by Category: The monetary gain (or loss)
resulting from revenues for an individual product after
subtracting all associated costs to provide or generate each
product or service.
• Average Gross Profit: The average profit for individual goods
or services based on the total product line.
• Average Gross Profit Percentage: The average percentage of
profit for all products and services generated.
• Gross Profit Percentage: The amount that each sales dollar
exceeds the cost of the product or service.
Other templates are available and multiple resources and references are
provided in the reference section of this chapter. Again, this book was devel-
oped to serve as a practical guide, but it is beneficial to consult an accounting
professional for assistance.
Given that much of the language used to describe the steps and formulas
involved in a break-even analysis focuses on general business practices,
attempts will be made to provide examples that apply to neuropsycholo-
gical practice as a model for application as much as possible. Specifically,
the steps will follow the examples provided in Tables 2.1 and 2.2 that
provide simplified spreadsheets designed around a single provider practice.
Where applicable, the financial numbers utilized are for ease of calculation
and understanding and are not based on any particular reimbursement
statistics.
Since neuropsychology services are billed at one price, but paid at multiple
different rates, some set standard will be needed so that a uniform level of
‘‘payment’’ can be established prior to Step 1. This could consist of a prede-
termined projected contractual percentage of billed charges based on research
on potential payor mix and typical payment rates or using a set projected
reimbursement rate (possibly using the Medicare Physician Fee Schedule).
Whatever decision is made, this adds error to the calculations so a conservative
method is recommended.
Gross profit is the amount of money that is made on each sale above what it
costs to provide the good or service (sales price – variable costs). In the
neuropsychology example, sales price is equal to the projected reimbursement
for the service provided (gross profit = reimbursement – variable costs). When
specific products are involved it is relatively easy to determine the variable
costs as described in the previous section. With services, as in neuropsy-
chology, this is sometimes more difficult, but good planning in the identifica-
tion of these costs is beneficial at this point. In the previous cost determination
section, there was discussion of dividing clinician salary costs into both fixed
and variable cost categories. Here is where that may be beneficial. If the
clinician’s salary is included in the determination of gross profit for each
service provided, a more realistic gross profit figure is obtained rather than
having large fixed costs erase what looked to be large profits for each service on
the initial calculation. Non-billable time that is categorized as a fixed cost can
be subtracted along with other fixed costs during later calculations to deter-
mine the break-even point of the business.
The next step is to add all of the gross profit amounts for each category
together to arrive at a total annual gross profit for the business and to add
increased as a business grows and the volumes and revenues grow sufficiently
to support the added expenditures.
Table 2.2 provides a sample fixed expense list for the single clinician practice
noted in Table 2.1. It is worth noting that in this model, the practice consists of
one full-time clinician making a yearly salary of $99,840 and one full-time
technician making $24,960. An additional 30% of these salaries are budgeted to
account for benefits and other payroll expenses. No additional staff is included,
so these two individuals will be responsible for handling referral calls, regis-
tering patients, completing the precertification needs, billing and coding activ-
ities, and management of the clinical records. This may or may not be realistic
for some individual practice settings. Additional figures are included based on
information available to the writer, but are included for demonstration purposes
only and are not necessarily consistent with true costs.
Steps 6 & 7: Calculating the Break-Even Point and Analyzing the Results
After some painstaking work, all of the numbers are available to determine
whether or not the proposed business is projected to make or lose money. As
the calculations have been completed, the answer has already been realized,
but it is important to finish to formal calculations. To find the amount of
revenue necessary to break even, you divide the estimated annual fixed costs
by the gross profit percentage. The result is the amount of sales revenue that
will be needed to exactly cover the costs of doing business. This may seem
intuitively backward at first. Instead of determining your profit based on your
projected sales, fixed costs are used to determine the necessary gross revenues
On the surface, analyzing the obtained information from this point seems
very simple. The business is either projected to be profitable or not. However,
there are a few more calculations that must be made. The first is to subtract the
estimated revenue from the break even point:
This excess revenue figure is then multiplied by the previously obtained gross
profit percentage of 43.29%, resulting in a projected net profit of $20,610.
Another way to get at this figure is to subtract the annual estimated fixed costs
from the total estimated gross profit. The noted differences reflect rounding
error that occurs during the various calculations:
place to cover initial start-up costs and slow initial sales or where saving
during high profit months allows for continued cash flow during leaner
times. In either case, if cash flow needs are identified in advance, it is easier
to plan for both the good and bad times.
The development of a cash flow analysis will use many of the same figures
and formulas developed earlier in the profit and loss forecast. The main
difference is that the focus is now on how cash flows into and out of the
business in real time instead of being based on projected sales revenues and
expenses. Additionally, expenses and revenues are accounted for in the month
where they occur rather than equally spread over a 12 month period. In most
new businesses there will be some negative values (placed in parenthesis) early
in the business that may be accounted for with planned start-up loans or other
investments. As the business becomes profitable, tax payments will need to be
included as well. This document will serve as a blueprint of the business’s
financial health from month to month and will help highlight areas and
timeframes where adjustments will need to be made.
The steps of developing a cash flow analysis are relatively simple, but
obtaining all of the information can be difficult. The process begins by starting
with the available cash on hand. For a new business this will be a zero value.
Cash-ins for the month are then calculated. This should include all sources of
income for the business, including the projected revenues, but also start-up
loans, investments, transfers of personal money, and any other money that
comes into the business. Adding these together provides the incoming revenue
for the month. The next step is to enter all of the projected payments out of the
53
specific emphasis on healthcare process, quality, and outcome measurement.
The application of these practices is presented in the context of neuropsy-
chology practice in the following chapter, with an emphasis on setting up
practice/departmental processes and procedures.
What Is Process?
According to the American Heritage Dictionary (Picket, et al, 2000), ‘‘process’’
refers to:
Process is not necessarily about the outcome, but instead refers to the activities
that lead to the outcome. This is more clearly seen in the definition of process
in business settings. Davenport (1993) defines a (business) process as a
structured, measured set of activities designed to produce a specific output
for a particular customer or market. Again, this implies a strong emphasis on
‘‘how’’ work is done within an organization in contrast to a product emphasis
or an emphasis on ‘‘what’’ is produced. Process is a specific ordering of work
activities across time and space, with a beginning and an end, and clearly
defined inputs and outputs. In essence, processes are the structure by which
an organization does what is necessary to produce value for its customers
(Davenport, 1993).
This sense of ‘‘value’’ in terms of process outcome is furthered by Hammer
and Champy (1993) as they define process in business as a collection of
activities that takes one or more kinds of input and creates an output that is
of value to the customer. The outcome of a process is not necessarily tangible
goods. Processes may also produce intangible services. In either case, the
purpose of the process is to produce value for the customer. To make this
idea more clear, Hammer and Champy describe ‘‘primary processes’’ as those
that result in a product or service that is received by a customer, while
‘‘support processes’’ produce products that are invisible to the customer but
essential to the effective management of the business. Rummler and Brache
(1995) go further to state that most processes ‘‘are cross-functional, spanning
Each of these terms refers to management and control of the process that
produces the desired outcome. The goal is to reduce variance and sub-
sequently improve quality. Albert Einstein has been given credit for the
quote, ‘‘Insanity is doing the same thing over and over and expecting to
get a different result.’’ Whether or not that truly came from Einstein, the
basis of the statement certainly applies to process control and manage-
ment. Similarly, in psychology, we often report that the best predictor of
future behavior is past behavior. This was captured more formally by
Shewart (1931, p. 6) in his discussion of process control: ‘‘A phenom-
enon will be said to be controlled when, through the use of past
experience, we can predict, at least within limits, how that phenomenon
will behave in the future.’’ This is the essence of statistical process
control. Quality is achieved through the elimination or reduction of
process and outcome variation.
In order to measure and subsequently control process variation, there must
first be an understanding of what process variation is. Every process or
behavior has some level of variability. In process control, the goal is to
distinguish common cause variation from special cause variation (Deming,
1986). A good example to demonstrate this concept is your signature. If you
write your signature on a piece of paper five times in succession, there will be
Run
3
Seven or more consecutive points all above
7
1 5 or below the center line (the mean).
6
2 4
Trend
1
2
Seven or more consecutive points moving
3 up or down bisecting the center line.
4 5
6
7
FIGURE 3.1 Determining Special Cause in SPC: ones, runs, and trends
From Callahan, C.D., & Barisa, M.T. (2005). Statistical process control and
rehabilitation outcome: The single-subject design reconsidered. Rehabilitation
Psychology, 50, 24–33. Used with permission.
PROCEDURES POLICIES
other activity. At this point, the output becomes a new input that instead of
going back through the healthcare process, goes back to the patient and
ultimately results in an outcome.
The outcome is based on how the patient reacts to his or her course of
intervention, the nature of which can be quite variable. The result of the
intervention may be favorable in that the patient is cured or the symptoms
are relieved. Alternatively, the result may not be favorable as the patient may
not receive relief or cure as a result of the interventions and may in fact die
despite the care provided. Traditionally, outcome would be the measurement
of the quality of care provided, whereas improvement in the presenting
condition would be a successful outcome and a lack of improvement or
worsening of the condition would equate to poor quality. However, patient
outcome research has shown that the positive or negative outcome of health-
care is not necessarily reflective of the quality of care provided. We know that a
patient can have a favorable or good outcome even in the absence of quality
care and that, conversely, a patient can have a negative or poor outcome even
in the context of quality care. Bente (2005), based on the work of Mark (1995),
contends that there is a unidirectional relationship between the quality of care
provided and the subsequent outcomes. In other words, if quality care exists,
one can conclude that the outcomes will be more favorable. However, if the
outcomes are favorable, one cannot automatically conclude that quality care
was provided in the healthcare process.
This is further highlighted in Bente’s healthcare control model (Figure 3.3
from Bente, 2005). This unidirectional relationship is presented with discus-
sion of the degree of direct control healthcare providers have on either the
process or the outcome. Those caring for the patient have little control over the
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CONTROL
To revisit an idea from the previous chapter, quality was defined as the
elimination or reduction of process and outcome variation. Some words
used to describe process quality included consistent, predictable, stable,
systematic, surprise-free, and zero defects. For a moment, think about the
office ‘‘process’’ in your workplace and ask yourself the following questions:
69
and mange the obtained information. The answers to all of these questions
highlight the importance of a stable process within a neuropsychological
practice or department.
This chapter focuses on the office system or process and how to set up or
alter the office processes with the goal of reducing variation and errors, while
improving consistency and quality, and ultimately, increasing profitability.
The office flow or system encompasses the entire process, from taking the
initial call to filing the chart after the patient has been seen and payment has
been received. In essence, the office process is made up of four major compo-
nents: people, process, paperwork, and (clinical) practice. This chapter
explores each of these areas with a focus on the development of a consistent
and predictable office system.
As noted, these are just some examples of activities. Depending on the setting,
this individual may also serve as a general administrative assistant with
responsibilities that include typing dictation, obtaining medical records
from other providers, or other secretarial/administrative roles.
Pre-Certification Representative
The Pre-Certification representative works to obtain the optimal financial
reimbursement for the patient’s clinical services. To accomplish this, a variety
of activities must take place. As such, this individual has multiple responsi-
bilities, including the following:
Billing/Coding Representative
While similar, the responsibilities of the Billing/Coding Representative are
different from those of the Precertification Representative. In some offices it
may well be the same individual, depending on the department/practice size
and structure. The primary responsibility for this individual is to ensure a
consistent financial flow for the department. A cooperative relationship with
clinicians and payors is required as this person serves as a liaison between the
clinician and subsequent payment. Activities include:
The Medical Records Officer works directly with all office staff and serves
as the ‘‘expert’’ in regulatory requirements. Training, with regular updates,
is necessary in departmental/organizational policies regarding chart devel-
opment and management as well as compliance with HIPAA and other
regulatory guidelines. This individual serves as a privacy monitor for all
patient information and is responsible for knowing where each record and
related information is located. Participation in the development and
implementation of departmental/office policy and procedures regarding
records is an additional role for the Medical Records Officer and this
includes in-services for all office and clinical staff on a regular basis to
Clinical Staff
The roles and responsibilities of clinical staff will not be discussed in detail.
Suffice it to say that it is expected that professional activities will be
performed in an ethical and clinically appropriate fashion. The emphasis,
for the purpose of this chapter, is that clinicians are aware that their
activities occur within an office process or system and that they are not
exempt from functioning within its parameters. To use a common phrase:
‘‘It’s not about you.’’ Collaboration and teamwork are essential for an office
system to function smoothly and work-arounds and exceptions should be
unacceptable to all — not just the office staff. It is the responsibility of
professional staff to support decisions made by office staff that are in line
with the office process even when they are inconvenient to the clinician.
Finally, it is important that clinical staff be involved in the development
and implementation of the office process so that there is mutual under-
standing and appreciation of how and why activities occur in the defined
manner.
Department/Practice Manager
I’ve heard it said that the second happiest day in a person’s life is when they
buy a boat — the happiest being the day that they sell it. Sometimes manage-
ment positions can work this way as well. Many people want to be in charge,
Process
While the specifics of office processes vary depending on the nature and
setting of neuropsychology practice, the general process of the practice must
be laid out in a manner that shows consistency, predictability, stability, and
quality built into all activities. It is necessary to document how the patient
moves through the office system from start to finish, including all activities
from determining how referrals are received to the ultimate filing of the chart
when all services are completed. This includes receiving the referral, sche-
duling activities, potential billing and coding services, identifying insurance
panels and other payors, determining precertification needs, administrative
and clinical documentation procedures, charting activities, types of clinical
services provided, and the clinical work itself. Additionally, activities must be
consistent with HIPAA and other regulatory compliance requirements. This is
no small undertaking, but with appropriate planning and process develop-
ment, a smooth, orderly, and predictable flow of seeing patients is achieved.
Paperwork
It is important to store and file patient-related information in an organized way
that promotes easy acquisition and auditing as necessary. Therefore, the
record or chart should be thought of as a specific component of the office
process and its structure should also be consistent and predictable. Depending
on the practice setting, the structure of a chart is quite variable. However, for
any given setting, chart development and management should be consistent
across all patients and providers. Information should be well organized with a
system that allows for easy location and access of necessary information.
For the purposes of this chapter, three main components of the patient
record will be presented: the administrative record, the medical documenta-
tion record, and supporting materials. For some hospital/institution-based
practices, the administrative record and medical record documentation are
part of the hospital medical record system (possibly through an electronic
medial record) with a separate ‘‘soft chart’’ containing test protocols and other
patient-related information specific to a neuropsychological evaluation. For
Practice
Process control ideas can be applied to neuropsychological clinical practice.
Think about how neuropsychological tests are administered and scored.
Clearly, neuropsychologists develop a certain (yet appropriate) level of ‘‘anal
retentiveness’’ when it comes to standardized administration of neuropsycho-
logical measures. In a similar vein, this strict adherence to a process can be
applied to all aspects of clinical practice including the patient flow described
above, as well as how clinical services are provided and documented. Clinical
documentation is discussed in detail in Chapter 6, but a consistent and
redundant form of accurate charting ensures that documentation is appro-
priate and consistent with CMS requirements. Finally, a clinical practice based
around a stable and predictable office process allows for greater focus on
clinical care rather than managing variance or errors that occur in the day-to-
day office system.
In terms of clinical care, it is important to establish a process to maximize
consistency and quality in the care provided to each patient. Think briefly about
a hamburger from McDonald’s or any other major chain. No matter where you
buy that hamburger you know exactly how it is supposed to look, smell, feel,
and taste. That is consistency and quality. Whether you like the product or not
you know exactly what you are going to get. That same consistency and quality
focus can apply to clinical care and neuropsychological practice, so that no
Closing Thoughts
The previous discussion of setting up the office process is based on using
process development and control applied to the practice setting. Review the
opening questions of this chapter again and think about how an improved
office process will result in better answers to these questions. Process control
application can be seen across all aspects of a department or practice office
flow. While it seems intuitively simple to develop and implement a stable and
consistent office process, without appropriate buy-in and leadership it can
quickly turn into an experience similar to herding cats. To be successful, a
strong commitment to process development and control is necessary by all
personnel involved in the department/practice.
89
APA Ethics and Recordkeeping Guidelines
Ethical recordkeeping starts with an understanding of the APA Ethical
Principles and Code of Conduct (APA, 2002). While various portions of the
Ethics Code apply to patient confidentiality, privacy issues, and appropriate
recordkeeping, Standard 4 (Privacy and Confidentiality) and portions of
Standard 6 (Record Keeping and Fees) are the most specific in regards to the
development and maintenance of patient records. In particular, Standard 4
outlines the obligation to protect the confidentiality of patient information:
These standards, along with other aspects of the APA Ethical Principles and
Code of Conduct, set the stage for appropriate patient documentation and
maintenance of records. This is a good starting point, but does not account for
the various legal statutes and institutional policies that can provide more
specific and, at times, conflicting responsibilities regarding patient records.
The management of these discrepancies is well laid out in the ethics code and
other statements put forth by the APA. In general, when there are conflicts
between institutional policies and procedures and the Ethics Code, psychol-
ogists appropriately address these issues as outlined in the Ethics Code
(Standard 1.03 – Conflicts Between Ethics and Organizational Demands),
clarifying the nature of the conflict, making known their commitment to the
Code, and, to the extent feasible, resolving the conflict in a way that permits
adherence to the Code. In terms of patient records, specific state and federal
laws and regulations govern psychological recordkeeping. In the event of a
conflict between the Ethics Code and any state or federal law or regulation, the
law or regulation in question typically supersedes the ethical principles and
standards.
Guideline 6. Security
The psychologist takes appropriate steps to protect records from unauthor-
ized access, damage, and destruction.
This guideline highlights two areas of application. The first is ‘ maintenance.’’
Patient records are to be stored in a secure manner that will safeguard against
damage whether they are paper or electronic records. This means that paper
records should be stored in a manner that protects them from physical damage/
Privacy Rule
While HIPAA’s primary privacy concern is health information transmitted by
or maintained in electronic media, the Privacy Rule reaches to data transmitted
or maintained in any other form or medium by covered entities as well as oral
communication. In short, the Privacy Rule focuses on when and to whom
confidential patient information can be disclosed. It focuses on the application
of effective policies, procedures, and business service agreements to control
the access to and use of patient information. In contrast, the Security,
Transaction, and Identifier rules only cover electronic information.
For neuropsychologists, it is important to note that the Privacy Rule
requires practitioners to:
Complying with these requirements can appear to be a daunting task, but the
Privacy Rule was developed with the understanding that the rules apply to a
large variety of healthcare providers and settings, ranging from large multi-
hospital systems to individual solo practitioners. As a result, the administrative
Security Rule
While the Privacy Rule outlined to whom and under what circumstances PHI
can be disclosed, the Security Rule addresses the provider/organization’s
physical infrastructure and outlines the steps that are taken to protect con-
fidential information from unintended disclosure through breaches of
security. The Security Rule applies only to protected health information
stored electronically, including any reasonably anticipated threats or hazards,
such as a computer virus, and/or any inappropriate uses and disclosures of
electronic confidential information (e.g., confidential patient information
e-mailed or faxed to the wrong person due to human or technical error). In
short, the Security Rule requires that steps be taken to ensure the confidenti-
ality, integrity, and availability of electronically stored PHI. The following
standard electronic transactions are specified by the Security Rule and trigger
the need to be HIPAA-compliant:
• Healthcare claims
• Healthcare payment and remittance advice
• Coordination of benefits
• Healthcare claim status, enrollment or disenrollment in a
health plan
• Eligibility for a health plan
• Health plan premium payments
• Referral certification and authorization
• First report of injury
• Health claims attachments
The covered modes of electronic transmission are quite broad and essen-
tially include all electronic means of communication/dissemination of infor-
mation, networking systems, and electronic storage devices. To ensure
compliance with the Security Rule, providers need to complete a risk analysis.
The national identifier for individuals was initially proposed in the early
1990s as part of comprehensive healthcare reforms that would have supplied a
universal healthcare credit card for individuals to use. The implications of
national individual identifiers, especially in light of the Privacy Rule provisions
and the concern of privacy advocates over the idea of assigning identity
numbers to individuals, became controversial and as a result, the development
of the individual identifier was subsequently placed on indefinite hold
pending further review.
1. Identify the kinds of red flags that are relevant to the practice
2. Explain the process for detecting them
3. Describe how the organization will respond to red flags to
prevent and mitigate identity theft
4. Spell out how the program will be kept up-to-date
Specific warning signs and threats to identity theft are available in Supplement
A to the Red Flags Rule available at ftc.gov/redflagsrule.
Final Thoughts
While this chapter was exhausting, it is certainly not exhaustive. As can be
determined from the information provided in this chapter, recordkeeping
activities can be quite detailed and cumbersome when it comes to compliance
with the numerous statutory, regulatory, and ethical provisions and guidelines
that govern the development, maintenance, and dissemination of patient
records. For better or worse, we have moved far away from the days when a
patient’s record was simply a folder with progress notes housed in a file
drawer. As such it is imperative that neuropsychologists stay up-to-date in
their knowledge regarding the various regulatory and legal requirements for
recordkeeping.
111
their application to neuropsychological practice. Billing submission activities
will then be presented, including some of the more challenging areas. Finally,
clinical documentation do’s and don’ts will be presented along with some
suggestions for templates for appropriate documentation. Chapter 7 addresses
reimbursement issues and exploring the financial impact of billing, coding,
and documentation activities.
As a disclaimer, the information provided in this chapter is based on a variety
of sources and resources including documents and transmittals from CMS;
several books, articles, and white papers covering billing and coding in health-
care; various documents from regional Medicare carriers and insurance com-
panies; and workshops provided by Antonio E. Puente and Charles Callahan
(see references and recommended readings at the end of the chapter for detailed
citations). It is impossible to provide complete coverage of these activities and
related issues in a single book chapter. The following is not meant to be
exhaustive, but instead provides an overview to stimulate thought and further
reading and research in this area. Given the rapid rate of change in this area,
continuous monitoring of this information is recommended as it is likely that
some of the information presented here is already outdated since its publication.
Assessment Codes
For neuropsychologists, the most commonly used assessment CPT codes are
those associated with neuropsychological and psychological testing. These are
described in ‘‘sets’’ due to the fact that in 2006 the CPT codes for these activities
were further specified to differentiate the work of professionals from that of
technicians and computer administration. The testing codes are as follows:
Since these codes were adopted in 2006, they have been a source of
confusion and frustration for neuropsychologists as CMS and many other
payors do not reimburse combinations of these codes for the same patient
Busis (2007) provides a very good overview of this code and its potential use.
The codes were established to report neurofunctional mapping of blood flow
changes in the brain by magnetic resonance imaging in response to tests
administered by physicians and psychologists correlating to specific brain
functions. This code includes time for selection and administration of testing
of language, memory, cognition, movement, sensation, and other neurologic
functions when conducted in association with functional neuroimaging; mon-
itoring of performance of this testing; and determination of validity of neuro-
functional testing relative to separately interpreted functional magnetic
resonance images. These activities are independent and are not reported in
conjunction with the psychological or neuropsychological testing codes
(96101–96103, 96116–96120).
This evaluation is most commonly performed pre-operatively for patients
with brain tumors, arteriovenous malformations, intractable epilepsy, and
other brain lesions that may require invasive (e.g., surgical excision) or focal
treatment (e.g., irradiation). The information derived from functional brain
mapping is utilized to predict the potential for neurologic deficits that may
arise from tumor growths and surgical interventions, thus making it possible
for the physician and patient to make informed decisions concerning the
feasibility and risk of intervention, determine the extent of surgical interven-
tion (e.g., subtotal vs. total resection) and identify expendable and nonex-
pendable cortical regions.The testing component is performed during the
Intervention Codes
While extensive detail was provided in the earlier descriptions of CPT codes used
for assessment activities, the discussion of intervention codes will be briefer, as the
codes, their descriptions, and their acceptance are somewhat more straightforward.
This is not to suggest that they are without controversy and inconsistency in terms
These are not time-based codes. They are billed as a single unit regardless of
time spent (valued at approximately one and a half hours). Additionally, they
can be used one time per illness, incident, or bout. The evaluation involves a
comprehensive analysis of records, observations, structured and/or unstruc-
tured clinical interview, and may include communication with family or other
sources and the ordering and medical interpretation of laboratory or other
medical diagnostic studies. This evaluation also includes a complete mental
status examination. Documentation includes history, presenting complaints,
mental status examination, impression, and disposition. The interactive diag-
nostic interview code (90802) may be applied to the initial evaluation of
children, or in some cases adult patients with organic mental deficits or who
Inpatient/Outpatient
90816/90804 – Individual Psychotherapy (20–30 minutes)
90818/90806 – Individual Psychotherapy (45–50 minutes)
90821/90808 – Individual Psychotherapy (75–80 minutes)
90817/90810 – Individual Psychotherapy, interactive, (20–30
minutes)
90819/90812 – Individual Psychotherapy, interactive, (45–50
minutes)
90822/90814 – Individual Psychotherapy, interactive, (75–80
minutes)
To close out this section, the following additional codes are presented
despite being less commonly used. Medicare and other payors may or may
not recognize these as reimbursable codes, but they may serve for documenta-
tion for private pay, forensic, or other settings. In institutional settings these
codes may be useful in documenting productive time despite reimbursement
limitations.
Assessment
96150: Initial Health and Behavior Assessment
The initial assessment of the patient to determine the biological,
psychological, and social factors affecting the patient’s physical
health and any treatment problems.
96151: Health and Behavior Re-Assessment
A re-assessment of the patient to evaluate the patient’s condition
and determine the need for further treatment. A re-assessment
may be performed by a clinician other than the one who con-
ducted the patient’s initial assessment.
Intervention
96152: Individual Health and Behavior Intervention
The intervention service provided to an individual to modify the
psychological, behavioral, cognitive, and social factors affecting
the patient’s physical health and well being. Examples include
increasing the patient’s awareness about his or her disease and
using cognitive and behavioral approaches to initiate physician-
prescribed diet and exercise regimens.
96153: Group Health and Behavior Intervention
The intervention service provided to a group. An example is a
smoking cessation program that includes educational informa-
tion, cognitive-behavioral treatment and social support. Group
sessions typically last for 90 minutes and involve 8 to 10 patients.
96154: Family Health and Behavior Intervention with Patient
Present
The intervention service provided to a family with the patient present.
A psychologist could use relaxation techniques with both a diabetic
child and his or her parents to reduce the child’s fear of receiving
injections and the parents’ tension when administering them.
96155: Family Health and Behavior Intervention without Patient
Present
The intervention service provided to a family without the patient.
An example would be working with parents and siblings to shape
the diabetic child’s behavior, such as praising successful diabetes
management behaviors and ignoring disruptive tactics.
Documentation
Once the CPT and diagnostic code groupings are mastered, the real work
begins. According to the Office of the Inspector General investigating
Medicare fraud, two of the primary problems encountered during audits are
inappropriate/incomplete documentation and failure to document medical
necessity. It is possible to address both of these issues simultaneously
by developing a clinical documentation system that automatically and consis-
tently incorporates appropriate documentation for the various CPT codes and
• Identifying Information
• Date(s) of Service
• Time, if applicable (total time or actual time - to be discussed
further)
• Identity of Observer (professional, technician, or other
provider)
• Reason for Service (including medical necessity)
• Status
• Procedure(s)
• Results/Findings
• Impression/Diagnosis
• Plan for Care/Disposition
This structure serves as the basis for all notes regardless of the CPT code being
used. The patient’s primary complaints as they relate to the presenting illness
are documented in terms of description of the symptoms present, the fre-
quency and intensity, context of the complaints, modifying variables, and
• Identifying Information
• Reason for Service (including medical necessity)
• Date(s) of Service
• Time (amount of service time - total versus actual time)
• Identity of Tester (professional, technician, other)
• Tests and Protocols (include names and editions)
• Narrative of Results
• Impression(s) or Diagnosis(es)
• Disposition or Plan of Care
• Identifying Information
• Reason for Service (including medical necessity)
• Date of Service
• Time (typically face-to-face time; again total versus actual
discussed later)
Additional Resources
Consult the Federal Register for ongoing updates – www.gpoaccess.gov/fr/
Regular review of regional Medicare carrier/intermediary websites
National Correct Coding Initiative – www.cms.hhs.gov/NationalCorrectCodInitEd.
The Medicare Learning Network (MLN) is the brand name for official CMS
educational products and information for Medicare fee-for-service providers.
For additional information visit the Medicare Learning Network’s on the CMS
website at www.cms.hhs.gov/MLNGenInfo.
Searchable CPT manual available free of charge on line from AMA at https://
catalog.ama-assn.org/Catalog/cpt/cpt_search.jsp.
135
reducing the risks inherent in clinical practice; establishing a value in the
marketplace for the service; meeting an institutions definition of value for a
department; and ultimately, survival of the department or practice.
Provider-Based Status
Facilities and organizations operated by a hospital, including remote locations
and satellite facilities, operate under provider-based status. This means that they
are a part of the hospital and are eligible to bill facility fees under Medicare Part
A. For inpatient services, this is bundled into the Diagnosis-Related Group
(DRG) payment. For outpatient services, payments are paid through the
Outpatient Prospective Payment System (OPPS) and are essentially payments
to the hospital for use of the facility for these services. The provider-based billing
and payments serve as a safety net for hospitals, allowing them to maintain
services that are necessary for the public, but are not revenue-producing (e.g.,
ER, OB/GYN, charity care, etc). It also allows for payment to the facilities
themselves in outpatient settings where the professional billing alone does not
capture all of the ‘ services’’ provided (e.g., outpatient surgery, radiological
• Hospital-employed psychologist
• Consultant to hospital – an independent practitioner through a
private practice or as a member of a physicians group directly
or indirectly linked to the hospital/facility, but seeing patients
in the hospital facilities
• Independent psychologist – distinct from the hospital/facility
Added together, the components comprise the total RVU for the service.
Within 5-10 years, another major component will be added based on perfor-
mance, where a component of payment will be based on outcome, not just the
service provided. The RVU is not just used for Medicare reimbursement, but
also serves as the basis for Medicaid, private payors, managed care, and other
third party payors.
To provide some perspective, the average work RVU is 1.00. Prior to 2005,
psychological testing and neuropsychological testing had a work RVU of 0.00
or no work value. RVUs were re-calculated for 2005 and the work value for
codes used in psychology and neuropsychology were significantly increased.
The current (2008) outpatient RVUs for psychological testing (96101) and
neuropsychological testing (96118) are 2.56 and 3.43 respectively. This is
important because the RVU is a primary value in the payment formula used by
Medicare. While increased, these values still fall well below many physician-
based services. Table 7.1 provides RVUs for select CPT codes commonly used
in neuropsychology.
Translation to Payment
Medicare-allowed payment amounts are found in the Medicare Physician Fee
Schedule (MPFS) that is updated annually based on a specified formula. The
formula consists of multiplying the service RVU by a geographic cost index
(adjustment factor based on geographic location) and the RVU conversion
factor (a dollar amount set by Congress annually to convert RVUs to payment
amounts). The product of these values provides the level of payment.
However, since 2007 this final figure is ‘‘modified’’ by a Budget Neutrality
Adjustor to adjust payments to meet budget requirements. Current MPFS
values for individual CPT codes by region are available at https://catalog.ama-
assn.org/Catalog/cpt/cpt_search.jsp.
The calculation of provider-based facility fees is slightly more complex.
Under Medicares hospital outpatient prospective payment system (OPPS),
facility fee reimbursement to hospitals for outpatient services are paid
through Ambulatory Payment Classifications (APC). The APC reimburse-
ment formula has three components: geographic adjustment, adjustment
To Be or Not To Be Provider-Based
On the surface, the values presented in Table 7.2 indicate that it is a relative no-
brainer to bill both professional and facility charges when this is possible. Under
the provider-based designation, hospitals have the ability to supplement profes-
sional fee reimbursement with facility fees. Provider-based professional fees are
discounted by Medicare because it is recognized that the hospital is carrying
practice expenses which are typically borne by individual providers in an office-
based setting. The reduction in professional fees is commonly referred to as a
site-of-service differential. In a provider-based environment, the hospital can
bill a facility fee to offset costs attributable to services performed in the hospitals
outpatient department. Typically, the aggregate reimbursement amount
improves under a provider-based model because the reduction in professional
fees is more than offset by the additional reimbursement associated with facility
fees. The reimbursement advantage is shown in Table 7.2.
However, the answer is not as simple as the numbers indicate. Essentially, two
bills are generated for the service that is provided. The professional fees represent
payment for the neuropsychologists professional time and effort. The facility fees
represent payment to the hospital for the use of the institutions resources. It is
Values presented are estimates for 2008 for the Boston Metropolitan area along with non-geographic corrected provider based facility fees.
important to note that while the professional fees will be shown as revenue
generation for the department, the facility fees may or may not be linked to the
departmental budget because these are fees paid to the hospital, not to the
provider. Not every hospital bills the facility fees associated with neuropsycho-
logical services, for a variety of reasons. Billing and departmental geographies
must comply with requirements and this may mean a loss in hospital revenue for
previously paid rent for space and an increase in utilization of hospital billing/
coding resources. This can be problematic given the increased billing complexity
as two bills are generated for each service and the separate billing can be difficult
to integrate. Provider-based billing also results in increased patient financial
responsibility as the two bills generated for the service can lead to an increase
in co-payments (co-pay for both the professional and technical component of the
bill). This may result in patient dissatisfaction and a negative perception that the
hospital is double-billing for services. Additionally, some payors do not pay the
facility fee portion of the bill, further adding to the financial burden on the
patient. As a result, providers and hospitals must explore this option carefully
before adopting a provider-based billing model. However, when these charges
are not billed, Medicare dollars are left on the table and given the tight budgets in
most departments and hospitals, the additional dollars can significantly enhance
the fiscal value of a department or service.
• Gross charges
• Net receivable per charge
• Number of visits
• CPT codes charged
• Units of service per CPT
• Units of service per visit
• Average charge per unit of service
• Cancellation/No-Show rates
Pre-Certification Process
The precertification process is an important step in securing appropriate
reimbursement from many payors. This process is not necessarily compli-
cated, but the steps required for each organization must be followed as there
really are no shortcuts to make the process any easier. Keeping notes about the
steps and nuances of each organization can be useful in streamlining the
process as much as possible and regular training of precertification staff is
essential. While the specific steps for each organization can be quite varied,
several factors can make the process easier, more time efficient, and in general
more successful and consistent. First, it is important to make sure that pre-
authorization paperwork is completed in a timely manner and that the patient
is seen within the required time parameters. Second, it is important that the
obtained authorization reflects the service to be provided (CPT code) and the
appropriate allowable amounts (units of service). If these are not correct, it is
necessary to re-file or appeal the decision to obtain the correct authorization. It
is almost a guarantee that if the preauthorization is incorrect, the payment will
reflect only what is authorized. For neuropsychology services, it is also
important to make sure that services are authorized under the medical com-
ponent of the policy to maximize reimbursement potential. In some cases,
negotiations will be required to keep the authorization on the medical side of
the insurance.
Some additional questions may need to be answered during the precerti-
fication process. First, it is important to know whether an initial interview/
neurobehavioral exam is required prior to the authorization process. If this is
the case, the patient should be notified in advance so they do not expect all
services to be completed on the initial date of service. Additionally, it is
important that this initial contact be documented, as soon as possible, in a
manner that fully demonstrates the medical necessity of the service in order to
Collection of Co-Pays
Co-pays are an obligation and part of the agreement between the insurance
company and the beneficiary. In the same sense, providers are contractually
required to bill for co-pays. Most patients with Medicare or insurance coverage
have a primary care and a specialist co-pay amount. In medicine, primary care
physicians typically require co-payment at the time of service and have this
information posted in clear view in their waiting rooms. Specialists either
collect co-payments at the time of service or may bill the patient later. This is
due to the fact that some specialty care services often require only one co-
payment that covers the entire service, even if multiple contacts are required.
Psychologists and neuropsychologists have a history of being reluctant to
collect co-pays and co-insurance payments. It is important to remember that co-
pays are not optional. It is the patients responsibility to pay their portion of the
medical bill. Typically, co-payment amounts are listed on the patients insurance
card, but if it is not printed there this information can be easily obtained by a
phone call to the insurance company or via a visit to the carriers Web site.
During the pre-authorization process for benefits you can easily obtain specialist
co-pay information. It is a good practice to inform the patient of expected co-
pays when the initial appointment is scheduled (particularly if this is done
through a written scheduling letter) and during reminder calls. In this way the
patient is well aware of the co-payment and is prepared to pay such at the time of
service. The $25 co-pay may not seem much at the time of service, but for a
small practice that serves up to ten patients a week, collecting the $25 co-pay
every week will result in an additional $12,500.00 annually.
Edward A. ‘‘Ted’’ Peck III (2009) provided a useful approach to managing
the co-pay issue. This is summarized and modified to fit the purposes of this
book as follows:
Administration Factors
As threats to reimbursement are considered, it is easy to overlook the decisions
made by administrators/managers regarding the billing/coding activities and
reimbursement of a department or practice. It is important to be aware of who
is actually doing the coding/submission and how accurately it reflects the
services and diagnosis provided by the clinician. Claims may be submitted by
the provider, a billing service or consultant, a hospital-based coding depart-
ment, or other entity on behalf of the provider. No matter who is actually
submitting the claim, the provider is responsible for any payments generated
by these claims so it is important to ensure accuracy and consistency with
clinical records. It is important to know how your claims are being filed and it
is appropriate to ask questions about that persons knowledge base for nuances
of psychological and neuropsychological billing. It is also important to know
Clinician Factors
It is imperative that clinicians understand appropriate billing and coding pro-
cesses and how they influence the financial bottom line of the department or
practice. In the same manner that billing and coding activities need to reflect the
correct code, time, and diagnosis, clinician documentation must also be accurate
and in accordance with Medicare requirements. Documentation of time is critical
to ensure that the service provided is fully captured and is consistent with the
submitted claims. If the activity is billable it should be documented and the bill
should be dropped. This should be built into department/practice policy and the
office staff should not accept a bill without documentation or documentation
without a bill. Regular training in billing, coding, and documentation activities
for clinicians is recommended, especially when updates/changes in policies have
occurred. This may also include reviewing quarterly financial reports so that
clinicians see how their activities affect the overall financial numbers. Finally,
scheduled audits for billing, coding, and documentation are recommended with
a culture or expectation of ‘ constant compliance.’’
The, processes laid out in this text should be helpful to avoid errors and risk of
future audits. Additionally, it is helpful to become familiar with the updated
information provided by Medicare and the OIG regarding fraud and abuse at the
Web site listed in the reference section. Briefly, Medicare and the OIG provide
the following suggestions to increase the probability of successful audits:
ACTIVITY
Volume
Office Visits 600 700 550 715 65 0
Inpatient Visits 203 600 418 405 440
Procedures 0 0 0 0 0
O t h er 0 0 0 5 43
Units of Service (CPT Code) 803 1,300 968 1,125 1,133
Note 1
129,446 11 8 , 1 5 8 98,926 100,773 13 9 , 11 7 1 3 2 , 40 5 34.34%
63,035 58,574 53,126 45,686 42,913 63 , 9 6 2 16.59%
47,375 47,518 41,762 40,747 36,723 31,340 8.13%
36,974 38,101 36,475 32,406 27,993 29 , 9 4 3 7.76%
113,169 132,770 153,657 132,296 1 2 7 , 59 3 12 7 , 9 6 9 33.19%
389,998 395,121 383,946 351,909 374,339 3 8 5, 6 1 9
66.9 73.9 82.4 83.6 80.1 77.7
At some point in our lives we have all encountered the schoolyard rule maker:
the kid that makes all of the rules for the games, and then frequently changes
the rules as needed to make sure that he or she wins the game. These rule
changes are impulsive, spontaneous, inconsistent, and at times completely
contradictory to a previous rule change. They come without notice and are
presented in such a way that no one can understand them well enough to ask
questions that might challenge their legitimacy. Additionally, the new rule is
stated with such confidence and in such a demeaning way that it seems that
you are the only person in the world who did not know that this is how the
game is played. Welcome to the world of healthcare preauthorization and
reimbursement! However, there is more on the line than playground bragging
rights, and it is not financially responsible to simply pick up your toys and find
a new playground (the same thing would happen there anyway). It would be
well beyond the confines of this text to fully explain this process (i.e., game) as
it applies to the multiple carriers, regional coverage areas, and individual
insurance representatives that exist. The topic of billing and reimbursement
(and navigation of the insurance company rules and regulations) would in and
of itself warrant more detailed discussion in a book of its own. Instead, this
brief chapter highlights some of the preauthorization and denial activities
found in the game of neuropsychological billing and receiving, along with
some suggestions to help you win the game every now and then. The
161
information presented here is based on personal experience with additional
assistance and input from Edward ‘‘Ted’’ Peck III.
Closing Thoughts
Given the variability built into the precertification process in managed care, no
system or process will be perfect and guarantee precertification and author-
ization every time. Even when authorization is provided, we have all dealt with
the reality that ‘‘prior authorization is not a guarantee of payment.’’ However,
having no system or process will certainly lead to greater difficulties, delays,
and frustrations in getting authorization and ultimately will raise the risk of
Thus far, this text has focused on setting up a consistent and predictable
process for the business of neuropsychology. Once the basics are established
and have proven successful from a process and fiscal standpoint, attention can
be turned to further growth and business development. This chapter provides
an outline for business development in neuropsychology with an emphasis on
smart growth based on the original strategic plan, while looking toward the
future.
Early in the development of a neuropsychological practice it is important
not to over-specialize, as volume is necessary to maintain a consistent cash
flow. This idea continues as a practice develops, but may be tempered by
real-life data related to reimbursement levels, payor mix of select patient
populations and diagnostic groups, personal and professional interest in a
specific area, referral source demand, staffing expertise and availability, and
other factors. There is the reality that the best investment strategies include
appropriate diversification of a portfolio, but care is taken to ensure that all
investments have some reasonable expectation of return. The same applies to
a neuropsychology practice. Exploration of a diverse range of possible
services extending beyond traditional neuropsychological evaluations can
identify other patient populations and clinical services to expand the pool of
potential referrals, in order to ensure consistent patient volume and reim-
bursement despite fluctuations in referral streams. Additionally, there are
unique settings, populations, specialties, or collaborations that may prove
beneficial in increasing visibility, expanding marketshare, delineating clin-
ical expertise, or simply accessing a source of high reimbursement relative to
167
traditional payors. With so many opportunities available, decisions
regarding program development require a return to strategic planning activ-
ities, but with a focus now on the growth of a practice rather than its
inception.
SWOT Analysis
A SWOT analysis is a strategic planning method initially developed by Albert
Humphrey of Stanford University in the 1960s-1970s and revised over the
years by writers in business marketing and organizational development
(Ansoff, 1987; Koch, 2000; Panagiotou, 2003; Turner, 2002; Valentin,
2001). A SWOT analysis is a basic, straightforward model that assesses what
an organization can and cannot do, as well as identifies potential barriers. The
method of SWOT is to identify various aspects of an organization and separate
them into internal (strengths and weaknesses) and external issues (opportu-
nities and threats):
This highlights some services that have been provided in some practices as a
means to expand their services. It is important to brainstorm and identify ideas
that fit the practice/department and identified parameters via the SWOT
analysis.
Final Thoughts
While growth in a business sense is typically a good thing, it is important to
manage the growth in such a manner that it is planned, predictable, and
profitable. Expansion for the sake of expansion can be problematic and may
result in commitments that can be detrimental to the financial bottom line or
a situation where the practice is unable to live up to the promises that were
made. Smart growth that reflects the initial mission and vision of the prac-
tice, accounts for available resources, and includes reasonable profitability
forecasting allows for greater potential for success, stability, and longevity.
This takes additional time and effort, but in the long run it is worth the
investment.
PROFESSIONAL DEVELOPMENT
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10
&&&
Non-Billable Time
In Chapter 9, an example of a controlled schedule was presented that allotted
specific times for full evaluations, abbreviated evaluations, headache clinic,
and pre-surgical evaluations, with feedback appointments, initial interviews,
and intervention appointments to be scheduled during technician testing
times. This is an unrealistic schedule, but was described to demonstrate a
schedule that would maximize billable time. What was missing from this
schedule? Think for a moment about your week in clinical practice and
183
develop a list of all of the scheduled or unscheduled activities that are non-
billable. The list includes at least some of the following and possibly more:
• Team meetings
• Case/care conferences
• Patient rounds with the team or physician
• Scheduled in-service training
• Informal consultations with physicians or treatment teams
• Grand rounds or other didactic opportunities
• Family conferences without the patient present
• Marketing/meet-and-greet activities
• Department business meetings
• Institutional committee/administrative meetings and obligations
• Institutional joint commission computer-based or group training
sessions
• Fixing scheduling/process errors
• Service recovery activities for the department/practice or the
institution
This is not an all-inclusive list by any means, but it is lengthy. When you factor in
a time component to each of these activities, time slips away very quickly. This
highlights the importance of managing a controlled schedule. When these
activities occur, they should be included in a schedule to document utilization
of time and resources. When all activities are put into a schedule, it is easier to see
what can and cannot be done within a work week, and when it is time to say ‘ no.’’
This strain on the schedule and reduced billable time is not necessarily a bad
thing. The activities listed above have meaning and value and can be beneficial to
patient care and even to the hospital in terms of overall reimbursement levels. The
key is to identify and document how the non-billed time brings value-added
service as well as indirect income to the institution. These are presented as distinct
concepts with value-added services consisting of activities that do not necessarily
generate revenue directly or indirectly, and indirect benefit services consisting of
activities that promote revenue generation with little or no direct billing.
Value-Added Services
For the purpose of this text, value-added service (VAS) is a term used to
describe non-billable services that promote the main business of healthcare. In
psychology, a VAS is an activity that adds ‘‘worth’’ to the overall clinical service
Research Activities
Using the Lamberty, et al. (2003) text again as a resource, research activities
occur in a wide variety of practice settings. As expected, those in academic
medical centers described the general ease and expectation of ongoing research
projects. Torres and Pliskin (2003) describe the open opportunities to partici-
pate in clinical research as part of their work in such an environment. The direct
access to clinical populations, opportunities for collaboration with multiple
disciplines, and the ability to capitalize on resources available within the
medical academic institution are cited as how research is facilitated in this
environment. Additional descriptions highlight the institutional support as
well as the enhanced opportunities to participate in individual and medical
center grants due to the academic affiliation and collaborations. McCrea (2003)
also highlights the benefits of multiple opportunities for collaborative research
in a general hospital setting, but differs in terms of his description by citing the
‘ balance’’ the department was able to create to manage the difficulty in securing
time dedicated to research in the context of clinical demands. While some of the
same benefits of hospital affiliation were described in available patient popula-
tions and collaborative relationships, his chapter focused more on securing
external funding and using research and publication activities to benefit the
department by increasing clinical referral streams. Greiffenstein (2003) provides
practical guidelines for designing and completing research studies in a private
practice setting. The nuances of developing a research program utilizing avail-
able resources, including time, are laid out nicely in this article.
The common thread across these three very different settings, explicit or
implicit in the content of the information provided, is that additional time is
expended to participate in research activities. More importantly, all three of
these authors provide methods to manage this dilemma and manage the time
parameters as much as possible. McCrea cites several factors that are ‘ key’’ in
finding time to mix research and clinical responsibilities in a medical center
environment, including contacts with other staff with research interests, colla-
boration with biostatistics staff, utilization of research assistants, securing out-
side grant funding, and gaining support from department and hospital
administration. These ‘ keys’’ were already cited in the Torres and Pliskin chapter
highlighting the ease of availability in the academic affiliated institution.
Most people spend the majority of their time in quadrants I and III, while
quadrant II is where the best work happens. The key is to recognize where the
Early career psychologists entering the field of neuropsychology are faced with
many new responsibilities, challenges, and opportunities. They also face what
seems to be a never ending stream of additional hoops to go through to finally
acquire and settle into their first job. For some the process seems to be an easy
transition, but it is safe to say that most new professionals bump into their
share of obstacles on their way to some sense of stability. This chapter is
designed to increase awareness of some of these difficulties and to provide
strategies to navigate the obstacle course as smoothly as possible. This topic
could fill a small text of its own in discussions of internship and postdoctoral
residency selection, licensure and certification issues, job searching activities,
vita preparation, interviewing skills, negotiation strategies, networking and
professional development, financial planning, and other issues. Perhaps an
early career neuropsychologist reading this chapter will take the challenge to
complete such a text. However, the brevity of this chapter allows for only a
brief overview of select professional issues salient to early career psychologists
and specifically neuropsychologists as they complete their training and
embark on their journey into professional neuropsychology.
193
increased practicum experiences, specialized nature of predoctoral intern-
ships, the typical two year postdoctoral residency for those in neuropsy-
chology, and the emphasis on research during training activities means that
new entries to the job market are coming into the field with significantly
heftier vitae than those of us who came into the field just a decade earlier. This
does not mean that there are employers just waiting to snatch up every new
professional that is graduating from postdoctoral residency. Quite the con-
trary, employers have the opportunity to be selective, as there are many quality
applicants for a select few positions. As a result, as with any marketing activity,
there is a need to project a competitive advantage over the competition (your
peers) in trying to secure that first position.
Job Searches
There are a variety of ways to learn about open positions in neuropsychology.
One of the most useful Internet job search engines for psychology is the
PsycCareers link on the APA Web site: http://psyccareers.apa.org/. This Web
site provides opportunities to search positions that are listed in the APA
Monitor on Psychology as well as other positions posted specifically to this
page. This site allows for searches by location, keywords, and/or job category.
Additionally, this is a good resource for a variety of other job search activities
and job search tools. Additional online neuropsychology job postings
are found on the Web sites of professional organizations, including
the International Neuropsychological Society, Divisions 22 (Rehabilitation
Psychology) and 40 (Clinical Neuropsychology) of the APA, and others.
The USAJOBS Web site is a useful search engine allowing for searches based
on keyword, location, and/or category for posted positions in federal govern-
ment agencies (e.g., VA Medical Centers, military hospitals). These positions
are oftentimes not posted in other locations so it is important to check this site
frequently if there is an interest in working in government facilities.
Mainstream job search engines such as Monster, HotJobs, etc. are not as
useful in neuropsychology, but can occasionally locate open positions on
institution/hospital Web sites that may or may not be posted on the neurop-
sychology-related search engines.
In addition to these search engines and others, job announcements are
frequently posted on the various neuropsychology and rehabilitation
psychology e-mail listserves. Participation in these listserves can be a great
resource to discover early position announcements prior to their posting on
the more formal search engines. Networking with current and former
These requirements are relatively standard across states, but some significant
differences remain. Still, it is beneficial to have this process completed, or at
least underway, prior to applying for open positions.
Obtaining licensure is not automatic, and by no means is it expedient. De
Vaney, Olvey, Hogg, & Counts (2002) highlight the difficulties in meeting
There have been increasing efforts to encourage new professionals to start the
board certification process early in their careers. In fact, the American Board of
Professional Psychology (ABPP) currently has an early entry program offering a
discounted application rate for unlicensed postdoctoral residents to start the
general application prior to the completion of their residency. This should not
be mistaken for an effort to delay the licensure process, but instead as encour-
agement to apply for licensure and board certification simultaneously. The
board certification process is more demanding and more time consuming, so
starting the process early, as with licensure, keeps the momentum going in an
early career psychologist’s professional development.
There are several certifying boards in neuropsychology available for con-
sideration and opinions about which board is best are not hard to find. Making
a determination of which board is the right board is not the purpose of this
text. However, early career professionals should take care when considering
which board certification to pursue and make the decision based on stability,
credibility, and legitimacy. There are many ‘‘vanity’’ boards available that are
Professional Development
Once quality networks are established, professional development and involve-
ment happens in a very natural fashion. These relationships spawn increased
activities within organizations and ultimately some early leadership opportu-
nities. As described in the APA-ECP brochure, most professional associations
have a hierarchical governance structure run by an executive committee that
oversees the administrative activities of the organization as well as a variety of
boards, committees, and other leadership groups. For new neuropsychologists,
it is best to identify opportunities that build on your strengths and expertise
while serving the organization.
There are many committees in every organization that are always looking
for individuals to step up and take an active role. Find a committee that fits
your interests and volunteer to serve. Taking an active role in the committee
strengthens networking and professional relationships and creates an iden-
tity with a new set of professional peers. For some, increased interest in the
activities develops and informal leadership qualities emerge. Ultimately, it
is very possible that they end up as a chair of the committee. From there,
the professional growth continues, possibly including elected positions
within the organization. It all started with joining a committee and getting
involved.
207
career neuropsychologist and to explore some opportunities for consideration
rather than offering direct information. Practical resources are offered where
applicable, but this chapter is intended to be more open-ended in its format.
1. Higher Income
2. Job Satisfaction
3. Job Security
4. Credibility
5. License and Practice Mobility
6. Streamlined Credentialing
7. Increased Knowledge Base
8. Reduced Public Confusion
9. Personal Validation and Satisfaction
10. Quality Assurance
The sixth area he describes is ‘‘financial’’ and this is presented as a ‘‘give and
take proposition.’’ Psychologists typically come to administrative roles with
little experience in the business world, little or no education in business as a
part of their doctoral curriculum, limited understanding of the language of
business, and little or no training in financial analysis. For psychologists that
make up for these limitations through additional educational activities (e.g.,
earning an MBA, MHA, or MPH), there is significant reward waiting on the
other side. Specifically, psychologists who can move into administrative posi-
tions typically have improved long-term earning potential and increased
power, prestige, and influence in their institutions. For the discipline as a
whole, psychologists in these positions are provided a seat at the adminis-
trative table, affording them the opportunity to keep psychology as a discipline
from becoming irrelevant and to promote positive changes from within
(potentially from the top).
Administrative roles are not meant for everyone, but for those who have an
interest in this area, the payoffs can be rewarding personally, professionally,
and financially. It is a not an automatic transition and is most effective when it
occurs in a natural developmental progression. Psychologists are rarely hired
directly into administrative positions. Typically, the leadership and knowl-
edge base they demonstrate in clinical settings target them for advancement
into supervisory or management activities. Administration looks for future
leaders that have an ability to motivate and influence others without de-
manding or setting a negative tone. This behavior may be seen in psycholo-
gists/neuropsychologists working in team environments or within a
departmental or training program structure. As psychologists move into
leadership/administrative roles it is important to learn the language of busi-
ness and learn as much as possible along the way. Additional education and
training may be useful for those with administrative aspirations to avoid the
Peter Principle – getting promoted to a level of incompetence
217
Assessment code (Continued ) result analysis, 41–43
96151: Health and Behavior revenue prediction, 35–37
Re-Assessment, 124 timeframe, defining, 34
Assessment documentation, 129 worksheet, 37t
Association of State and Provincial Building Bridges: Opportunities for
Psychology Boards (ASPPB), Learning, Networking, and
197 Leadership, 202
Average gross profit, 32 Business
Average gross profit percentage, 32 definition of, 3
calculation, 38–40 structure, 4–8
Average moving range (XmR), 59 cooperative, 4, 7–8
corporation, 4, 6–7
Baylor Health Care System, 19 partnership, 4, 5–6
Be Ready for ABPP in sole proprietorship, 4–5
Neuropsychology (BRAIN), of hospitals. See Hospital-based
199. See also American business structures
Academy of Clinical Business and strategic planning,
Neuropsychology (AACN) purpose of, 13–14
Billing, 12–13, 111 Business description
Billing/Coding Representative, 73–74 business knowledge and
Board certification, 196–99 accomplishments, 30
advantages of, 212 business process, 26–27
Board eligible, licensure, 196 competitors analysis, 28–29
Bottom line content areas, 25
administration factors, 151–53 marketing strategies, 29–30
charity care and write-offs, 151 marketplace, defining, 27–28
clinician factors, 153 purpose, 26
co-pays collection, 149–50 Business partnership, 4, 5–6
increment of, 208–10 Business plan, 23
managing threats, 154 break-even analysis, 31–33
no pays/zero-pays, 151 average gross profit percentage
payor mix, 147–48 calculation, 38–40
pre-certification process, 148–49 break-even point, 33, 41–42
use of trainees and students, fixed cost estimation,
153–54 40–41, 41t
Break-even analysis, 31–43 income and expenditure
average gross profit percentage estimation, 34–35
calculation, 38–40 result analysis, 41–43
break-even point, 33, 41–42 revenue prediction, 35–37
fixed cost estimation, 40–41, 41t timeframe, defining, 34
income and expenditure worksheet, 37t
estimation, 34–35 cash flow analysis, 46–49
218 Index
completion of, 49–50 Continued professional
accounting basics, 50–51 development, 211–13
development of, 25 Continuous quality improvement
business description, 25–30 (CQI), 56
financial aspects of, 30–49 Control chart, 58–59
financial aspects of, 30–31 Cooperative business, 4, 7–8
goals, 23–24 Co-pays collection, 149–50
profit and loss (P&L) forecast, Corporation, 4, 6–7
43–45 Cover letters, for job search,
start-up costs estimation, 45–46, 195–96
47t Cross-functionality, business
Business process, 54 process, 55
Current and possible future analysis,
Canadian Psychological Association 169–71
(CPA), 197 Current Procedural Terminology
Cash flow analysis, 46–49 (CPT), 111, 112–13
Centers for Medicare and Medicaid and ICD diagnoses, 125–26
Services (CMS), 13, 36, 62, documentation, 126–31
63, 82, 111 for neurological practice, 113–14
Charge system, developing, 144–46 assessment codes, 114–19
Charity care and write-offs, 151 intervention codes, 119–25
Childhood developmental diagnoses Curriculum vita (CV), 195–96
codes Customer, business process
96110: Developmental Testing; element, 55
limited, 117 Customer service representative, 75
96111: Developmental Testing;
extended, 117 Development/practice manager,
Children’s Health Insurance 75–77
Reauthorization Act of 2009, Diagnosis-Related Group (DRG)
136 payment, 139
Clinical staff, 75 Diagnostic interview codes
Clinical training programs, 187–89 90801: Psychiatric Diagnostic
Clinician factors, and bottom line, Interview Examination, 120
153 90802: Interactive Psychiatric
Closing a practice, checklist for, 215 Diagnostic Interview
Code sets, 101–2 Examination, 120
Coding. See Current Procedural Differentiation, competitive
Terminology (CPT) advantage, 176
Competitive advantage, 176 Doctoral clinical psychologist,
Computerized medical records, definition, 53
81–82 Documentation, 126–28
Constant compliance, 56 assessment documentation, 129
Index 219
Documentation (Continued ) First job
intervention documentation, identifying right position,
129–30 199–201
professional documentation, 128 issues in, 201. See also Early career,
issues in
Early career, issues in. See also First job searches, 194–95
job securing, 193–94
financial planning, 203 Fixed cost, 32
loan repayment, 203 calculation, 40–41
networking and mentoring, 202 Full-time retirement, 214–15
professional management, Functional brain mapping code
202 96020: Functional Brain
research awards, 203 Mapping, 118
Early career research awards, 203
Electronic health and medical Goals
records (EHR), 81 of business
Embeddness, business process, 55 financial requirement, 23–24
Employer Identifier Standard, 102 fundamentals of business,
Entrepreneur’s Toolkit (Harvard 23, 24
Business Essential), 4 characteristics, 16
Evaluation, business process Graduate Medical Education (GME),
element, 55–57 153
Examination for Professional Practice Gross profit, 32–33
in Psychology (EPPP), 196
Expected unit sales, 32 Health and Behavior Assessment
and Intervention Codes,
Facility fees. See Fees 122–25
The Facts of Managed Care, 163 Health and behavior codes
Federal Pay Scale, 200 96150: Initial Health and Behavior
Fee structures Assessment, 124
facility fees 96151: Health and Behavior
eligibility for, 11, 12, 13 Re-Assessment, 124
provider-based, 140–142 96152: Individual Health and
professional fees Behavior Intervention, 124
provider-based, 142–144 96153: Group Health and
Financial status, and business Behavior Intervention,
structure, 8 124
Financial bottom line. See Bottom 96154: Family Health and
line Behavior Intervention with
Financial dashboard example, 156t Patient Present, 124
Financial planning, career issues, 96155: Family Health and
203 Behavior Intervention
220 Index
without Patient Present, Improved time management,
124 190–91
and psychotherapy codes, Indirect benefit (IB), 185–86
differentiation, 123t Intellectual stimulation, 210–11
Healthcare leadership, 212 International Neuropsychological
Healthcare process, 60–63 Society, 199
healthcare control model, 61–62, International Organization for
62f Standardization
healthcare process model, ISO 9000 family of standards, 56
60–61, 61f International Statistical
outcome measurements, in Classification of Diseases
psychology and and Related Health
neuropsychology practice, Problems (ICD), 111
63–65 Intervention documentation, 129–30
Healthcare reimbursement, 161–65
Health Insurance Portability and Job searches. See First job
Accountability Act (HIPAA),
97 License eligible, licensure, 196
access and disclosure, 104–5 Licensure, 196–99
applicability and action, 102–4 Licensure requirements, 197
consent and authorization, 105 Limited liability company (LLC),
Employer Identifier Standard, 5–6
102 Limited liability partnership (LLP),
final caveats, 106 5–6
in research settings, 105–6 Loan repayment, career issues, 203
overview, 98
Privacy Rule, 99–100 Managed care, rules of, 163–64
Security Rule, 100–101 Managing threats, 154
Transaction Rule and Code Sets, Marketing efforts, 176–78
101–2 Marketplace, defining, 27–28
Hospital-based business structures, Market sector, 3
8–10 Medical records officer, 74–75
for-profit hospitals, 8, 9–10 Medicare, 145, 149, 150, 151, 153
not-for-profit hospitals, 8, 9 approach to payment, 139–40
Hospital settings, psychology translation to payment, 140–42
practice in, 10 benefit structure, 137–38
consultants, 12–13 Part A, 137
departments, 11 Part B, 137
hospital-based psychologists, Part C, 137–138
10–12 Part D, 138
independent practitioners, 13 fraud and audits, 154–55
Index 221
Medicare (Continued ) paperwork, 79–81
model for reimbursement, people, 70–71
136–37 billing/coding representative,
provider-based status, 138–39 73–74
choosing, 142–44 clinical staff, 75
Medicare Advantage (MA), 137–38 customer service representative,
Medicare Fraud and Audits, 154–55 75
Medicare Physician Fee Schedule development/practice manager,
(MPFS), 140 75–77
Medicare Trust Fund, 137 medical records officer, 74–75
Mission, of organization, 15–16. See patient liaison/administrative
also Goals assistant, 71–72
MPFS allowable payments pre-certification representative,
for select CPT codes, 143t 72–73
practice, 82–83
National Academy of setting, and issues, 83–84
Neuropsychology, 199 Opportunities, SWOT, 168–169
National Employer Identifier (NEI), Ordered activities, business process
102 element, 55
National Health Plan Identifier, 102 Outcome measurement, in psychology
National Provider Identifier (NPI), and neuropsychology practice,
102 63–65
Networking and mentoring, career Outpatient Prospective Payment
issues, 202 System (OPPS), 138–39
Neuropsychological testing,
reimbursement procedures, Paperwork, 79–81
172 Partnerships, 4, 5–6
Neuropsychology, definition of, 176 Patient liaison/administrative
Non-billable time, 183–84 assistant, 71–72
IB activities, 185–86 ‘‘Pay for performance’’ model, 63
value-added contributions, 186–87 Payor mix, 147–48
value-added services, 184–85 Personal liability of owners, 8
No pays/zero-pays, 151 The Practice of Clinical
Neuropsychology, 24
Office of the Inspector General Preauthorization and rejection
(OIG), 155 scenarios, 162–63
Office process, 69, 77 managed care rules, 163–64
auditing, 78–79 Pre-certification process, 148–49
computerized medical records, Pre-certification representative,
81–82 72–73
flowsheet, 86–87 Primary processes, 54
identifying, 77–78 Privacy Rule, HIPAA, 99–100
222 Index
Process Record Keeping in
definition, 54 Organizational Settings,
of office. See Office process 95–96
Process control, business process, Responsibility for Records, 92
55–57 Retention of Records, 94–95
Process management, 58–60 Security, 93–94
Products, 36 Health Insurance Portability and
Professional development and Accountability Act (HIPAA), 97
advancement, 211–13 access and disclosure, 104–5
Professional documentation, 128 applicability and action, 102–4
Professional management, career consent and authorization, 105
issues, 202 Employer Identifier Standard,
Professional status, enhancing of, 102
210–11 final caveats, 106
Program developing tool, marketing, overview, 98
175–78 Privacy Rule, 99–100
Project Apollo, vision of, 17 in research settings, 105–6
Provider-based status, 138–39 Security Rule, 100–101
choosing, 142–44 Transaction Rule and Code Sets,
Professional fees. See Fees 101–2
Red Flags Rule, 106–8
Quality Relative Value Unit (RVU), 139–40
business process, 55–57 for select CPT codes, 141t
definition of, 55–56 Reimbursement, 11, 161–65
Medicare model, 136–37
Receivables and financials, 146–47 procedure for neuropsychological
Recordkeeping, 89 testing, 172
APA Recordkeeping Guidelines, Research activities, 189–90
91–92 Research awards, career issues, 203
Confidentiality of Records, Retirement issues, and closing a
92–93 practice, 215
Content of Records, 92
Disclosure of Record Keeping St. Vincent Health in Indianapolis
Procedures, 93 core values, 18–19
Disposition of Records, 97 health mission statement, 18
Electronic Records, 95 of Neuropsychology
Financial Records, 96 Department, 20
Maintenance of Records, vision statement, 18
93 Scope of practice, re-defining, 168
Multiple Client Records, 96 SWOT analysis, 168–69
Preserving the Context of S corporation, 5–6
Records, 95 Security Rule, HIPAA, 100–101
Index 223
Select CPT codes 96103: Psychological Testing
MPFS allowable payments for, Administered by Computer,
143t 114
RVUs for, 141t 96118: Neuropsychological
Service lines, 171–173 Testing by Professional,
balancing of, 174–75 113–14
business-based evaluation and 96119: Neuropsychological
examination, 171–173 Testing Administered by
Services, identification of, 36 Technician, 113
Six Sigma Quality, 56 96120: Neuropsychological
Small Business For Dummies, 4 Testing Administered by
The Small Business Start-Up Kit: Computer, 113
A Step-by-Step Legal Guide Threats, SWOT, 169
(Nolo), 4, 24 Time, 183
Sole proprietorship, 4–5 management of, 190–191
Start Your Own Business, 4 non-billable time, 183–84
State Children’s Health Insurance indirect benefit activities,
Program (SCHIP), 136 185–86
Statistics process control (SPC), value-added contributions,
58–60, 60f identifying and documenting,
Strategic planning 186–87
definition of, 14–15 value-added services, 184–85
goals and objectives, 16–17 training programs and research
in healthcare, 17–19 activities, 187
mission, 15–16 clinical training programs,
values, 15, 16 187–89
vision, 15 research activities, 189–90
Strengths, SWOT, 169 Time wasters, 190
Strengths, Weaknesses, Opportunities, Total cost, 32
and Threats analysis. See Total quality management
SWOT analysis (TQM), 56
Suppliers, of goods and services, 3 Total revenue, 32
Support processes, 54 Total variable cost, 32
SWOT analysis, 168–69, 208 Traditional Mental Health
Psychotherapy Codes,
Templates, computerized, 24 120–22
Testing codes Trainees and students, 153–54
96101: Psychological Testing by Transaction Rule, HIPAA, 101–2
Professional, 113 Type I error, in process evaluation,
96102: Psychological Testing 57–58
Administered by Technician, Type II error, in process evaluation,
113–14 57–58
224 Index
Unit price, 32 Variable cost, 32
Urgent and not important Veterans Administration (VA), 187
tasks, 190 Vision, of organization, 15, 16
User-benefited principle, 7
User-controlled principle, 7 Wada procedures, 172
User-owned principle, 7 Weaknesses, SWOT, 169
Western Electric Rules, 59
Value(s), 15, 16, 54 Word-to-mouth recognition, 177
Value-added services, 12, 55, 170,
184–85 Zero-pays, 151
Index 225