Plan Now and Save Yourself from Problems Later

Not long ago, a city in California felt so strongly, and negatively, about a particular addiction recovery provider that they banned the company from opening any type of facility in their city.  Though extreme, this is an example of what can happen when the addiction recovery business isn’t performing well. The balance between providing effective services while staying responsible as a business is paramount.

While no one is denying that there is an increasing demand for addiction recovery services and facilities, with the scrutiny the industry has experienced, the time has come for everyone in this business to rise above the challenges, hold ourselves to the highest standards, and operate in a manner that is ethically sound and financially responsible.

If you’re just getting into the industry as a business owner, whether starting new or leading an existing operation, now is a great time to consider how you will include such things as:

  • Verification of benefits
  • Authorizations
  • Billing functions
  • Collections
  • Denial management
  • EMR / Scheduling software
  • Reporting / analytics

Making these important decisions now will save you enormous headaches in the future as your business grows and the needs change.

In this blog post, we’ll focus on VOBs and Authorizations and how Inspira FInancial can help you with obtaining accurate information in a timely manner — critical to any recovery center.


Verification of Benefits (VOBs) and Authorizations


Accurate and timely VOBs and Authorizations are vital to a recovery facility. Nearly every center has a horror story of losing $20,000-$30,000 on a single client because the authorization process was not accurate or information was not received in time.

In one case, an adolescent was in treatment when the insurance terminated. The facility was not notified of the term for over one month. This resulted in over $20,000 in services rendered that could not be billed.

Loss of revenue in situations like this, especially when it occurs multiple times, can cripple an organization or cause it to close its doors.

Finding out which clients will pay you and how much they will pay is critical and shouldn’t be left to chance in the hope that it will all work out in the end.

Up-to-date information is a must for the financial health of your center.


The VOB Process


Quickly verifying the benefits for someone needing treatment can be crucial to that person getting the help they need.

In most circumstances, a person seeking treatment for themselves or a loved one contacts a treatment facility and speaks with an admissions staff member. They explain the situation and the staff member enters that information into the system that the billing company uses to verify the insurance benefits of the potential client.

At Inspira Financial, within one critical hour, we contact the insurance company, verify benefits, and communicate thoroughly with the facility. Though other companies may provide VOB services, and some within the one-hour timeframe, Inspira collects more than just rough coverage information. For instance, we not only collect deductible amounts for the year, we also capture the amount of benefits already utilized by the client.

Another piece of critical information we obtain is whether the insurance plan is employer-based or through the Affordable Care Act (ACA), since residential or detox clients may lose their ACA-based plan if they don’t stay current on payments.

We also check to see if the insurance policy is a “pay to patient” type of plan. Many recovery centers know that receiving payment that was sent directly to a client can add extra steps, staff hours, and could have a higher risk of non-pay.

This accurate, detailed data is extremely beneficial as the client is admitted and the process progresses to authorization for services and length of stay, preventing costly mistakes before the client is even through your doors.




Within one day, Inspira will collect the information needed for obtaining authorization for treatment from the insurance company:

  • An Inspira physician or highly trained staff member will talk directly with the insurance company to communicate the medical needs of the client. For our customers, this type of professional communication has allowed us to obtain 25% longer authorizations for the highest levels of care, allowing you to more effectively provide needed treatment for your clients
  • The level of care will be determined based on medical necessity. This could include detox, residential care, or partial hospitalization
  • The duration will be established and communicated

We cannot emphasize enough that the VOB and authorization processes must be fast and flawless for a recovery center to maintain financial health. This is where many centers go wrong and it can financially devastate your business. If authorizations are not obtained prior to treatment, most of the services rendered will be unbillable – a loss that usually cannot be negotiated away.


Avoid Having To Pay on Someone’s Behalf


If an insurer determines that an authorization wasn’t obtained properly, they can levy action against the center. Regulations may allow them to apply future payments to what they see as the “overage” or even demand a large payment be returned within a short amount of time. In one case, the insurance company demanded $185,000 repayment within 30 days. Again, this is a situation that can crush a facility financially.


Quickly Determine if a Client is Financially Risky for Your Center


With Inspira’s state-of-the-art system, customers can elect a custom feature that allows Inspira to determine a revenue prediction for a particular insurer or plan. Using a formula that calculates the number of days and level of care (or multiple levels of care) as well as expected payments, an expected total payout can be determined. Because different insurance companies have varied allowable expenses, this calculation is very useful for a center in determining expected revenue. The ability to quickly determine a client’s insurance benefit will allow you to make the best decisions for your center.

Processes such as VOBs and Authorizations are so critical to a recovery facility’s operation and, if not thoroughly planned and implemented, can create issues that will ripple through the entire organization.

Discover more about how Inspira Financial can help you succeed in business by checking out this blog post on how to replace your billing company the right way.