Managing AR to Keep the Cash Flowing in Ambulatory Care Settings Waystar, Inc. All Rights Reserved.

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1 Managing AR to Keep the Cash Flowing in Ambulatory Care Settings 2018 Waystar, Inc. All Rights Reserved.

2 Our Client Focus The combination of Navicure and ZirMed uniquely positions Waystar to simplify and unify the healthcare revenue cycle with innovative technology that allows clients to collect more with less cost and less stress, so they can focus on their goals, patients, and communities. + = 2

3 PRESENTER: Lisa Waterfield Enterprise Revenue Cycle Consultant ZirMed

4 Agenda AR Challenges AR KPIs Dealing with AR Pain Points How to deal with declining patient payments How to step up the attack on claim denials What to do about AR process inefficiencies Solutions for AR Challenges 4

5 AR Challenges

6 AR Challenges Top Ways Providers Lose AR Days Inaccurate demographic/ registration information Insurance verification and denials Small balances and outsourced accounts Upfront collections SOURCE: Top Ways Hospitals Lose Accounts Receivable, top-ways-hospitals-lose-accounts-receivable.html 6

7 Challenges Facing Revcycle Leaders Most pressing RCM issues CFOs Revcycle Leaders Collections 35% 11% Patient Pay (HDHP, increase in patient portion) 19% 27% ICD 10 compliance 18% 18% Several concerns are AR focused Denials 13% 15% SOURCE: Revenue Cycle Challenges and Recommendations for 2017, by Jonathan Wiik, HFMA, February

8 Do You Have AR Challenges? Here are some of the main symptoms: High AR Days Low Clean Claim Rate High Denials and Low Denial Overturn Rate 8

9 Top AR KPIs 9

10 Measure Your Performance with AR KPIs Metric Calculation Best Practice Days outstanding Total outstanding AR / charges taken from last 90 days <30 days 1 Claim denial rate Percent of claims denied by payers <5% 1 Claim submission speed # of days before claim sent to payer 95% within five days of procedure/encounter 2 Clean claim rate % of claims sent without edits 98% 1 Net collection rate Total payments / total charges (less bad debt and refunds) >97% 1 SOURCE: 1 5 RCM benchmarks for ASCs to know and improve upon, Brian Zimmerman, Becker s ASC Review, Nov 2, Benchmarking to improve ASC Outcomes, Becker s ASC Review, Oct 21, 2015

11 Attacking AR Vulnerabilities Patient Payments 11

12 Patient Payment AR Vulnerabilities Just 34% of patients can pay the full amount owed 1 80% of newly insured patients are considered high risk to pay 2 Over 50% of bills go unpaid 3; Only 15% of bills sent to collections are recovered 4 SOURCE: 1 10 things to know about healthcare collections & patient financial responsibility, Becker s Hospital CFO Report, March 08, Do high deductibles mean high risk for physicians? by Donna Marbury, Medical Economics, December 10, Tackling the growing self-pay revenue problem, 5 steps to get cash from your self-pay portfolio, by Shawn Yates, Becker s Hospital CFO Report, July 19, Perspective on Patient Payments, by James Margolis and Christina Pope, MGMA, April 2010

13 Patient Responsibility Rising Patients as Payers Rise in HDHPs and Premiums HDHPs grew 50% between 2011 and Employer plan deductibles increased 50% between 2009 and Medical bills are the biggest cause of bankruptcies 3 Patient Financial Obligations Patients are underinsured misunderstanding financial obligations, insurance, HDHPs 60% of patients don t know how much they will owe before they receive care 4 SOURCE: 1 CDC: Americans with High Deductible Health Plans Skyrocket since ACA, by Michael Wyland, June 9, Employer health plan deductibles see big 5-year jump, by Jayne O Donnell, USA Today, September 10, This is the No. 1 reason Americans file for bankruptcy by Maurie Backman, The Motley Fool, USA Today, May 5, The Perfect Plan for Prompt and Painless Patient Payments, by Tim Ledbetter, HIMSS16 Conference, March 2,

14 Best Practices for Collecting from Patients Ensure accurate benefits eligibility Offer credible estimates Ensure secure payment processing at POS Provide advanced collections and payment processing automation Present patientinitiated payment plan capabilities Offer consumerfriendly, intelligent billing and statements 14

15 Ensure Accurate Benefits Eligibility Automate benefit verification Reduce time staff spends verifying benefits Increase cash from payments collected up front Make payment arrangements prior to rendering services Prevent denials 15

16 Offer Credible Estimates Improve Patient Satisfaction by Assisting Patients in Understanding What They Will Owe Estimate patient responsibility before rendering services Accuracy is key to a good estimate. Use your historic payment and remittance data Provide printed estimate for patients Collect payment for the full estimated amount or set up a payment plan More than one-third of privately insured individuals received an unexpected hospital bill within the past two years, and in excess of 33 percent did nothing to resolve it* * 3 Steps to balance collections and patient satisfaction, Becker s Hospital CFO, June

17 Ensure Secure Payment Processing at Point of Service Ensure protection against the liability shift Credit card payments expanded to 85% Ensure you are protected against the liability shift EMV chip card enabled readers add additional protection 80% INCREASE The 80% increase in data breach hacks in 2015 makes it clear that hackers are targeting healthcare with large-scale attacks affecting one in three Americans. - Nat Kausik, CEO, Bitglass 17

18 Provide Advanced Collections & Payment Processing Automation Maximize Staff Productivity Mobile-optimized enable patients to pay from anywhere at anytime Reduce manual tasks by reducing the paper: electronic statements, online pay Immediate actionable bills prompt quicker bill pay by consumers Mobile phones are also changing the way consumers make payments 22% of all mobile phone owners reported having made a mobile payment and this number continues to increase. * * Board of Governors of the Federal Reserve System 18

19 Present Patient-Initiated Payment Plans Reduce the Cost-to-Collect Allow patients to make online payment arrangements without staff intervention Rules engine to guide minimum installment amounts & maximum payback terms Real-time patient balance without requiring username/password Reason for Non-Payment * 37% Lack of Financing 19% Just received my statement 19% Other 17% Forgot/confused about what is owed 8% Healthcare is a right, won t pay *McKinsey, Revisiting Healthcare payments 19

20 Offer Consumer-Friendly, Intelligent Billing & Statements Improve Patient Satisfaction & Increase Likelihood of Payment Drive all post-activity with easy-to-read statements that motivate payment behavior Enhance patient understanding of owed expenses through intentional callouts Unread statements should be dropped to paper to ensure they aren t ignored 75% 75% of patient bad debt is attributed to patients who want to pay but have unanswered billing questions * * APTA Podcast, Nancy White 20

21 Find Hidden Coverage for Self-pay Patients Find hidden coverage for self-pay patients to collect the revenue owed to you IDENTIFY hidden coverage CONFIRM coverage is active DELIVER results to collect revenue Business Intelligence Engine processes requests against Best in KLAS technology platform to identify hidden coverage. Robust repository contains data across the continuum of healthcare equating to billions of transactions that are leveraged for identifying hidden coverage. Proprietary algorithms identify coverage on all patient accounts with pre-identified payers confirming active coverage exists. The advanced payer logic leverages over 1,200 payer connections resulting in a superior hit rate. Actionable results delivered to client, clearly articulating active and inactive coverage for all patients provided. Efficiently collect owed revenue by taking action with information delivered in flexible formats. 21

22 Attacking AR Vulnerabilities Claims Processing

23 Claim Denials Denial AR Vulnerabilities 12% 65% Payers initially deny 12% of the top CPT codes 1 Two-thirds of denials could be appealed or recovered, but 65% are never worked 1 Process eats up $118 per claim in time and labor 1 1 Denial rework costs providers roughly $118 per claim: 4 takeaways by Kelly Gooch, June 26,

24 Best Practices for Attacking AR Claim Vulnerabilities Submit Cleaner Claims with a Powerful Rules Engine Automate Claim Status Monitoring Ensure Comprehensive Denial and Appeal Management 24

25 Submit Cleaner Claims with a Powerful Rules Engine Claims Management solutions provide pre-written rules and edits that can process cleaner claims, reduce AR days and help you get paid faster Increase the percentage of claims approved on the first pass Leverage pre-written rules and edits that process cleaner claims and reduce AR days so you get paid faster Along with your claims management vendor, strive for 98+% clean claims rate 10 s of Millions of Rules Derivations Custom Rules Written by ZirMed Teams Embedded Claims Scrubber That Prevents Denials Before Claims are Sent to Payers 25

26 Automate Claims Status Checking Reduce Manual Processes and Free Up Staff Get early insight into the status of your claims Reduce manual intervention, time and resources Work only the accounts that need attention Focus on interventions that yield actionable results 26

27 Denials Are Created Across Your Revenue Cycle Front-Office Billing Office Pre-visit Patient Intake Care Clinical Doc Concurrent Review Coding Charge Capture Billing & Claims Submission Checking Eligibility Verifying Benefits Obtaining Pre-Authorization Checking Medical Necessity Obtaining Referral Obtaining ABN Confirming Registration Accuracy Matching Orders to Services Performed Confirming Medical Necessity Obtaining Authorization Appropriate Level of Care Services Properly Documented Diagnostic and Procedure Coding Reflects Documented Services Appropriate Use of Modifiers Bundling of Services Adherence to MUEs Medical Unlikely Edits Proper Billing Form Correct Type of Bill Complete Provider Information Within Timely Filing By creating awareness and changing behavior across your revenue cycle, you can spend less resources managing your denials on the back-end 27

28 Save Time Working each Denial and Appeal No organization can afford to ignore denials 28

29 Save Up to 50 Minutes for each Denial and Appeal No organization can afford to ignore denials 29

30 Attacking AR Vulnerabilities Process Inefficiencies

31 Revcycle Inefficiencies: Risk of Remaining Status Quo of the US healthcare dollars in 2022 are projected to be wasted due to 30% inefficient payment processing 1 $9.4B projected annual savings when best practice of ERA & EFT transactions exist across provider networks 2 Preventable Productivity Loss Increase in Audit Risk Error Prone Manual Efforts Risk in Increasing AR Reassociation, scanning, & finding of missing deposits & remits can take hours Deciphering workable vs. informational denials is time intensive Error prone reconciliation leads to inaccurate AR & increases risk for audits Risk of inaccurately depicting cash flow by posting receivables prior to cash received Manual posting has high administrative costs with large risk of inaccuracies Manual efforts in working denials & managing missing information increases risk for errors & AR days Posting delays cause bottleneck in AR realization Delays in reconciling postpone secondary billing, patient collections, denials, & underpayment analysis SOURCE: 1 The McKinsey Quarterly (June 2007) CAQH Index

32 Best Practices for Attacking AR Inefficiencies Automate bank reconciliation to post payments more quickly Automate processing paper checks from payers 32

33 A Better Payer Payments Process Gain Clear Insight Into Your Cash Flow AUTOMATE to route the right data to the right place PRIORITIZE exceptions to maximize productivity DELIVER results to optimize and confirm revenue By maximizing automation: Remits are split appropriately All paper is converted Remit/deposit matches are aligned Focus on unmatched deposits first Reduce manual bottlenecks Decrease complexities in AR accuracy Increase and streamline cash flow Deliver reporting for root cause identification, productivity insight, and actionable follow-up Provide single repository of payer payment information 33

34 Solutions to Reduce AR Across the Revenue Cycle

35 ZirMed s End-to-End Revenue Cycle Management Solution Built for healthcare and delivered in the cloud Claims Management 24/7 Real-Time Processing Intuitive UI / Workflow A/R Management Data at the Core Revenue Integrity Predictive Analytics Seamless Integrations Patient Responsibility Eligibility and Coverage Detection Contract and Risk Modeling Technological Foundation Multi-Tenant Massive Scale / Redundancy Agile Development Rapid Code Deployment

36 What Becomes Possible Maximize patient collections, accelerate claims processing and reduce process inefficiencies Accelerate payment and decrease denials by submitting cleaner claims Optimize staff productivity by automating claims status checking Improve patient experience by providing easy-to-ready statements Automate bank reconciliation and post payments faster Reduce collection costs by allowing patients to pay in multiple ways Ensure cash flow by enabling auto-payment set-up while reducing manual intervention Save time working and appealing denials Accelerate cash by identifying active coverage faster and collect owed revenue 36

37 Q&A and Resources For more information, contact: ZirMed (855) Thank you.

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