Medical firms duke it out in bankruptcy dispute

Hendersonville company blames billing service for receivables crunch

Email | Print By Walker Duncan

A Hendersonville neurological services firm has filed for bankruptcy while pointing a finger at its former billing company.

Recent court filings show Nursing Visioned Medical Services filing for Chapter 11 protection on March to shield itself from its creditors blaming Gallatin-based Medical Billing Partners for a drop in reimbursements.

Eight-year-old NVMS offers surgery monitoring services and blood component therapies. Robert Gonzales, the MGLaw attorney representing the company, says its senior secured lender, First Tennessee Bank, began “exercising its rights” last year as reimbursements were falling.

In court filings, NVMS claims “poor billing practices” on the part of MBP led to a 40 percent drop in NVMS’ reimbursement rate. In a filing of its own, MBP counters that little changed year over year in terms of collections.

According to MBP’s records, NVMS received about $5.6 million in collections for claims managed by MBP in 2006 and roughly $5.5 million in 2007. The slight decline, MBP goes on to claim, was due to the loss of a physician service provider and reduced billing on the part of NVMS.

To get a handle on its receivables – and with the encouragement of First Tennessee, which recently featured NVMS in a newsletter – the Hendersonville company filed for protection. The problem now, the filings claim, is that it’s unable to track down and collect its receivables because MBP has held the billing data ‘hostage.’

NVMS, which last month parted ways with MBP, claims the data MBP is holding could equate to hundreds of thousands of reimbursement dollars. It adds that the issue is complicated by the time limit – usually 90 to 180 days – set by insurers for considering claims.

In fact, the dispute is not over the release of the information, but over its format. Chris Kerney of Hale Dewey Knight, who is representing MBP, said releasing the data as it’s currently stored in MBP’s system would reveal proprietary information.

That argument didn’t sway Judge Marian Harrison, who last week ruled in favor of NVMS’ motion to require MBP officials to be deposed by Gonzales and his team and ordered MBP to hand over the electronic billing information no later than March 20.

NVMS’ filings also list its 20 largest unsecured claims, which add up to more than $2 million. Among the creditors is MBP, which is owed a little more than $100,000.