In this episode, Christina Brown, BESLER’s Director of Reimbursement Services, and Olga Barone-Allan, BESLER’s Director of Revenue Integrity provides us with a glimpse into BESLER’s next free webinar, Exploring IME and GME – Hospital Reimbursement and Revenue Integrity Perspectives, presented live on Wednesday, April 2, at 1 PM ET.
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Learn how to listen to The Hospital Finance Podcast® on your mobile device.Highlights of this episode include:
- What to expect from the upcoming Exploring IME and GME Webinar
- Shadow bills and why they’re important to IME and GME
- Why shadow bills are missed during the billing and reporting process
- How IME and GME play a part in what hospitals will get reimbursed
- Medicare Advantage patients
- Benefits of an independent shadow billing review
Kelly Wisness: Hi, this is Kelly Wisness. Welcome back to the award-winning Hospital Finance Podcast. We’re pleased to welcome back Christina Brown, BESLER’s director of reimbursement services, and Olga Barone-Allan, BESLER’s director of revenue integrity. In this episode, Christina and Olga will provide us with a glimpse into BESLER’s next free webinar, Exploring IME and GME – Hospital Reimbursement and Revenue Integrity Perspectives, that we’re presenting live on Wednesday, April 2nd at 1 PM Eastern Time. Welcome back and thank you for joining us, Christina and Olga.
Olga Barone-Allan: Thank you for having us.
Christina Brown: Yeah, thanks so much, Kelly. It’s always a pleasure.
Kelly: Yes, it is. Well, let’s go ahead and jump in. So, Christina, can you tell us about what we can expect from the upcoming Exploring IME and GME webinar?
Christina: Yes, absolutely. So, this webinar is going to offer a unique dual perspective as it relates to IME and GME. And as you may or may not be aware, IME and GME is a very robust area and really needs to be completed accurately on all fronts in order to maximize the benefit of operating teaching programs within a hospital. In this webinar, Olga and I will be discussing these perspectives and what is important on both fronts. I’m going to start by discussing some basic terms related to IME and GME as it relates to reimbursement. Then Olga will discuss some basics related to the revenue cycle, like the shadow claims. Then we will dive a little deeper, and I will talk specifically about areas within the cost report, and Olga will then do a deeper dive into the claims and notable implications. You can hopefully expect by the end of the webinar, if you haven’t already, start to connect the dots into how these different perspectives are important to hospital reimbursement and the importance of understanding the relationship to one another.
Kelly: Wow, it sounds like it’s going to be a very interesting webinar. So, Olga, over to you. So, let’s talk about shadow bills and why they’re important to IME and GME.
Olga: Absolutely. The importance for reporting shadow bills. So, teaching hospitals receive two additional payments to their Medicare prospective payment system. One type of payment is for the direct graduate medical education, also known as DGME, and one type of payment is for indirect medical education, also known as IME. The direct graduate medical education covers the direct fixed costs of training physicians. The payments are received via a cost report settlement to each hospital based on the number of specialties of the residents it trains. The IME portion covers the indirect costs that teaching hospitals incur given their broader range of services. While the original claim is sent to Medicare Advantage payer for payment, a shadow claim is also dropped and is submitted to Medicare for informational purposes. And we will go over what type of providers will receive these additional payments during the webinar.
Kelly: Wonderful. Sounds great. So, it seems like shadow bills are very important to IME and GME. So why are shadow bills missed during the billing and reporting process?
Olga: It’s amazing, even hospitals with established best practices around the shadow billing process find missed shadow bill opportunities during a system conversion or a program update. Plan codes are constantly updated, and billing triggers are complicated to set up and they need to be maintained regularly. These cause shadow claims to be missed, at least one of the reasons. Their processes which previously operated well are at risk of breaking down without the necessary attention during the system conversions. System changes may involve a steep learning curve for hospital staff during implementation, and the opportunity for billing errors increase substantially. We will go over some of the top findings that BESLER finds during their review.
Kelly: Wonderful. Thank you for that, Olga. So, Christina, you mentioned you’ll be talking about the cost report. Does that mean that IME and GME play a part in what hospitals will get reimbursed?
Christina: Yes, that’s a very accurate assessment, Kelly. And to be more specific, there are many components related to medical education reimbursement that are vital in what hospitals get reimbursed for these programs. Some of these areas I’ll discuss will be directly related to specific worksheets on the cost report and what types of things should be considered or reviewed when making entries to the applicable cost report worksheets. During the discussion of the worksheets, I’m also going to touch on the importance or financial significance that each worksheet plays when it comes to reimbursement. Reimbursement for medical education is impacted by many things, like resident counts, FTE counts, per resident amounts. And even more notable for purposes of this webinar, the Medicare utilization days play actually a big role in what is reimbursed through the Medicare cost report.
Kelly: Yeah, sounds like it is pretty important. Let’s talk about Medicare Advantage patients. So, it seems like there has been an increase of Medicare Advantage patients, and the provider’s assumption that the IME shadow process is well established. And that could lead to more mis-claims, creating an even bigger problem in processing IME and reporting GME. Is that right?
Olga: Absolutely. Not only are the number of available plans increasing each year but also increasing are the number of beneficiaries selecting those plans and opting out of traditional Medicare. This now includes end-stage renal patients who can elect a Medicare Advantage plan. Before 2006, Medicare Advantage in its current form did not exist. As of January 2025, it has been reported that 50.4% of all Medicare beneficiaries are enrolled in Medicare Advantage plans, and the trend is continuing to grow. During BESLER’s independent reviews, we estimate, on average, 5-8% of shadow bills are missed, which with the growing number of patients enrolling in Medicare Advantage plans could result in a significant amount of missed indirect and direct medical education reimbursement in cost report calculations. As more and more patients are opting into Medicare Advantage plans, this potential missed revenue grows as well. To put things in perspective, the average IME shadow bill is worth $3,167 a claim in 2025.
Kelly: Wow, that is significant. That could really add up. IME billing of a shadow bill requires specific condition codes to be on the claim which could cause issues if they’re missed. Am I correct with that?
Kristen: You are absolutely correct, and that’s a great point to go over. And we’ll go into depth more on the webinar, but each Medicare administrative contractor has guidance on the appropriate submission of Medicare shadow claims for processing teaching and non-teaching indistinct units. We noticed many are missing or have an incorrect condition code which causes claim to be processed incorrectly or fall into the RTP, return to provider, category. We see this mostly with distinct unit psych and rehab claims, which is a requirement to submit even though they are zero-pay claims. Due to the zero pay, it is often not noticed that there was an error with the condition codes, resulting in the days not being captured for cost report calculation. Again, we will provide the appropriate codes during the webinar.
Kelly: Sounds like something to look forward to there. What are the benefits, Olga, of an independent shadow billing review?
Olga: So, Kelly, missing shadow bills cost teaching hospitals well over 150 million every year. Properly submitting shadow bills is a compliance mandate for all teaching and non-teaching facilities. An independent review of a hospital shadow billing process will identify opportunities for improvement, potentially recover lost revenue, ensure compliance, free up staff time to focus on more productive tasks, and, more importantly, ensure that the hospital is well-positioned as Medicare Advantage enrollment continues to expand.
Kelly: Those are some significant benefits there. Thank you for sharing those with us. Back over to Christina. So do you have anything else to add for us today?
Christina: Sure. Yeah, I can add something. So, while I’m not an expert on shadow bills, I do understand the importance of a solid process for review as I see the impact firsthand on the reimbursement side of things. I mentioned earlier that Medicare utilization plays a role in what gets reimbursed on the cost report, and just to be more specific, that is as it relates to Medicare Advantage. So, the MA plans do not pay for IME for MA patients directly. That actually has to be done through the cost report. So, teaching hospitals are required to bill Medicare for Medicare Advantage patients through the shadow bill process. So, you can see exactly why that is so important.
Kelly: Most definitely. Thank you both for joining us, Christina and Olga, and for sharing this sneak peek into the upcoming Exploring IME and GME – Hospital Reimbursement and Revenue Integrity Perspectives Webinar that we’re presenting live on Wednesday, April 2nd at 1 PM Eastern Time. And as a bonus, you can earn CPE. Thanks again, Christina and Olga.
Christina: Thanks so much, Kelly.
Olga: Thank you, Kelly.
Kelly: And thank you all for joining us for this episode of The Hospital Finance Podcast. Until next time…
[music] This concludes today’s episode of The Hospital Finance Podcast. For show notes and additional resources to help you protect and enhance revenue at your hospital, visit besler.com/podcasts. The Hospital Finance Podcast is a production of BESLER | SMART ABOUT REVENUE, TENACIOUS ABOUT RESULTS.
If you have a topic that you’d like us to discuss on the Hospital Finance podcast or if you’d like to be a guest, drop us a line at update@besler.com.
