Published - December 2000

By Dave Jakielo


Happy New Year everyone. This is the time of year when I like to sit back reflected on the last few years, also I think it is a worthwhile exercise to put on our thinking caps and try to project what may occur in the next few years.

Some of you know that I went back to school after 20 years to earn my Master degree, which has been on my personal goal list for many years. I'm happy to report that I only have one class remaining and I am scheduled to graduate from Carnegie Mellon University, on May 20, 2001. See; if I can do it anyone can.

This past semester I had a course entitled, " Health Systems Management." It was a very interesting course it encompassed three areas:
How Health Care evolved into our current system.
What is dominating today's Health Care decisions?
And my favorite, "Where is Health Care Going."

We had many discussions about what we thought might occur and when it may happen. A very insightful instructor, Professor Alan Whitman, led the learning process in our course. He has a wide variety of professional experiences in the healthcare arena and was very willing to share his experiences and predictions.

He taught us a very "scientific" method for predicting what will occur in healthcare in the future. The formula is identified by the acronym, "HAGBOE." For the unfortunate who haven't been exposed to this "scientific" method, being the kind of guy, I am, I'll share with you so you too can be enlightened.

HAGBOE = Half Ass Guess Based On Estimates

This method is what everyone uses when dealing with future predictions. However, the more experience we have and the more situations we are exposed to in healthcare the better we become at the HAGBOE method.

So with the above in mind below are some of my predictions for the upcoming years.

The privacy provisions of the Health Insurance Portability and Accountability Act (HIPAA) were released on December 20, 2000, and apply to health information in electronic, paper forms and oral communications created or maintained by health plans, health care clearing houses, and health care providers who engage in certain electronic transactions. While it is very important that we understand and implement the policy and procedures mandated by this act, it won't be the demise of the billing industry. This isn't a threat to our industry it is an opportunity.

Believe it or not Medicare is increasing reimbursement for various CPT codes for the year 2001. An important reminder is to conduct a comprehensive fee schedule review for your clients, related to the new fee schedule. DO IT NOW. To my surprise we had to increase some fees in our practice because Medicare will pay more than we were charging. A few examples that pertained to us related to visit codes for new patients, 99203 and 99204 plus some hospital visit codes like 99222. It is imperative that you conduct a thorough review to ensure you are not leaving money on the table for your clients.

There is absolutely no risk in this prediction, hospitals will continue to close throughout the country. In many cities we are so overbedded it is ridiculous. In Pittsburgh and Philadelphia, PA occupancy is running less than 60 percent. Some facilities are under 50 percent. We all know there are too many hospitals and too many physicians and the numbers of both will continue to decline. Remember it is extremely important that if you want to be a viable billing company you should not have more than 25 percent of your clients practicing at only one hospital. Because if that hospital closes and your clients are out of work, you may be out of business.

Lastly, I do feel that we will have some company develop a smart card similar to your credit card or banking card that will contain an individuals insurance coverage information and will streamline the billing process. The patient will carry their card, which will be swiped through a terminal, and we will simply enter the CPT and ICD9 code. The insurer will then credit the client's bank account and the process is complete. This will not lead to the end of the billing business as we know it, but will change our businesses dramatically.

Keep in mind I'll be happy to address any issue of importance to you. So keep your questions and suggestions coming. Send inquires to any of the following. David Jakielo, Seminars, Training & Consulting 86 Hall Ave. Pittsburgh PA 15205. or visit my web page at

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