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Vaccine AdministrationMany physicians’ practices opt to outsource medical billing to save expenses on overhead, staff, hardware and other infrastructure. When it comes to vaccine administration, things are quite challenging. With flu season in full swing, doctors’ offices are struggling to align vaccine administration costs with revenue. A report published in Medscape in 2011 noted: “Issues in vaccine reimbursement threaten to disrupt this critically important service, a result of the high price of vaccines and the risk involved in maintaining a large, expensive inventory”.

A study by leading insurer athenahealth, which analyzed trends in vaccine reimbursement to pediatricians over a 2-year period from several payers, found that the rate of underpayment was more than 47%. Immunizations are an important preventive public health care service and physicians who regularly provide the service need to stay financially viable to continue providing this service. Let’s look at some of the costs involved in vaccine administration and the steps that primary care practices can take to minimize vaccine-associated losses.

Besides the high cost of the vaccines, the indirect expenses that practices face from administering seasonal influenza vaccinations include:

  • Staff costs.
  • Storage costs.
  • Insurance against loss of the vaccine.
  • Recovery of costs caused by inventory reduction, wastage, and non-payment.
  • Lost opportunity costs – the value of the best alternative forgone due to vaccine administration.

A recently published article in Medical Economics lists various strategies that can alleviate cost and reimbursement issues associated with seasonal vaccination administration:

  • Ensure accurate medical coding: With ICD-10, there is no need for individual diagnosis codes for each vaccine. ICD-10 provides sufficient detail about the type of immunization that the physician reports with a CPT or HCPCS code. Code Z23 is reported for an immunization encounter regardless of the type or number of vaccines administered. This is very helpful to report multiple childhood immunizations. Physicians also need to report the right administration codes which are meant to cover the cost of the vaccine as well as the cost of the related overhead expenses. CPT codes 90460 and 90461 should be used for face-to-face encounters with counseling, as in the case of an office visit. Codes 90471 and 90474 should be reported for vaccines administered in a walk-in or flu clinic.
  • Compare vaccine costs before purchase: The problem that physicians face is two-fold: the costs of vaccines are rising and some manufacturers are requesting payment faster. Vaccine reimbursements are based on an average cost and therefore paying a high price for the vaccine is uneconomical. To overcome this challenge, physicians should make it a practice to compare prices on all vaccines from several manufacturers – every year. This may mean sourcing different vaccines from different companies to get the best price.
  • Cut additional administrative expenses: Installing a quality Electronic Health Records (EHR) system is important for this. EHRs are designed to improve quality of care and effectiveness of service delivery. These systems can track patients who need vaccines, identify patients who are delayed, and enable ordering and coding of multiple vaccines at the time of administration. Barcode scanning technology improves the speed and accuracy of documentation of administered vaccines.

Though the margin on vaccine administration is not huge, primary care physicians have to ensure that they are not losing money while providing this important service. Partnering with a reliable medical billing and coding company is an ideal strategy to drive improvement in billing, coding, and practice management processes. The cost-effective solutions that these companies provide can enhance vaccination reimbursement.