Effective Revenue Cycles Are No Accident Physician Leadership Institute March 7,2015 Jerrie K. Weith, MBA, FHFMA, CMPE, CMOM
Learning Objectives Characteristics of Best Performers Efficient Encounters = Revenue Cycle Success Measuring Revenue Cycle Performance Physicians Role in Revenue Cycle Excellence
Effective Revenue Cycles Are No Accident Characteristics of Best Performers Investment and re-investment in technology The right staff Payer relationships Effective processes
Characteristics of Best Performers Technology Systems HIE
Characteristics of Best Performers Technology EHR/PMS communicate Updated regularly Continued education
Characteristics of Best Performers Staff Right fit Productivity Re-invest Weekly meetings The Why factor
Characteristics of Best Performers The lowest level of performance by any employee, allowed to continue without corrective action, becomes the highest level of performance that can be required of any other employee in a similar position with the employer. Reference: Rosemarie Nelson MGMA Healthcare Consultant The ROI of IT: Best Billing Practices
Characteristics of Best Performers Payers Set-up Rules Options Changes Reference: AMA 2012 National Health Insurer Report Card http://www.ama-assn.org/ama/pub/physician-resources/practice-managementcenter/health-insurer-payer-relations/payer-specific-information.page?
Characteristics of Best Performers Process Does it make sense? Uniform Set expectations Does the process help you meet them?
EFFICIENT ENCOUNTERS = REVENUE CYCLE SUCCESS
Efficient Encounters = Revenue Cycle Success Efficient encounters Scheduling Eligibility & benefits verification TOS Claims generation Payment processes Account resolution Collection process
Efficient Encounters = Revenue Cycle Success Patient demographics Capture the right information Account review Work #, cell phone, email Insurance details Patient expectations Train your patients to be good patients We expect payment at the time of service. Guarantor details Ms. Smith, I see you have a past due amount of $50.00. How would you like to take care of that Employer today? We information accept Visa, MasterCard, or do you have an FSA?
Efficient Encounters = Revenue Cycle Success Is it worth it? Automate Centralize Payer websites Choose your criteria: Services Payers Everything Use the information obtained! 3 days in advance
Efficient Encounters = Revenue Cycle Success Eligibility & benefits verification 51% providers knew what patient owed at TOS 78% patients knew what they owed at TOS It costs between $0.05 and $0.74 to check eligibility How much will your practice benefit to know what your patient owes at the TOS?
Efficient Encounters = Revenue Cycle Success Eligibility & benefits verification Faster payments Quicker to collect at TOS than through statement cycle Increase patient satisfaction No one likes a financial surprise after the visit! Increased efficiency Automate through clearinghouse and PMS
Efficient Encounters = Revenue Cycle Success Compare coverage to expected treatment & fee schedule Contact patient patient counseling Set alerts in system & schedule Collect at TOS
Efficient Encounters = Revenue Cycle Success TOS Confirm information Collect at check-in Collect at check-out How would you like to pay today? We accept Visa, MasterCard, cash and checks.
Efficient Encounters = Revenue Cycle Success Reference: InstaMed Trends in Healthcare Payments Annual Report: 2012
Efficient Encounters = Revenue Cycle Success TOS Complete record 24 hours Computer Assisted Coding (CAC) Interface charges
Efficient Encounters = Revenue Cycle Success Claim generation Charge lag 24 hours (48 hours out of office services) Claim scrubbing Edits Correction Do you update your claim edits on a regular basis?
Efficient Encounters = Revenue Cycle Success Utilize a clearinghouse 997 claim rejection report Submit charges within 24-48 hours 277u claim status report Initial follow-up 24 hours Level 1 rejections
Efficient Encounters = Revenue Cycle Success Payment and Adjustment Processing EFT and ERA! Contractual Non-contractual Post all zero pays Utilize system automation Reconciliation
Efficient Encounters = Revenue Cycle Success Patient Balance Processing Electronic statements Save providers up to 42% compared to paper Make it convenient Only 4% of patients receive medical bills via email Estimated $300 billion will be spent by consumers online in 2016 62% consumers use online bill pay Shorten the cycle Day 0 Day 30 Collection letter Day 60 Day 75 turnover Reference: InstaMed Trends in Healthcare Payments Annual Report: 2012 Reference: Gartner Group, HFMA, and HH&N Research
Efficient Encounters = Revenue Cycle Success Account resolution Automate when possible 277/997 reports 24 hours after submission 14-21 days clearinghouse 31+ days direct to payers Universal note area Appropriate reports Review notes & tasks Payer High $$$ Down DOS Group by Patient
Efficient Encounters = Revenue Cycle Success Should it be written off? Contractual versus non-contractual adjustment If Is so, a correction & resubmit! needed? Collect data, follow Should payer it process, be involve appealed? patient & track status
Efficient Encounters = Revenue Cycle Success Collection process Automate process Monitor results Write-off at turnover Use specific codes Create reports by code
Efficient Encounters = Revenue Cycle Success Where do you go from here? Decide what is right for your practice! Investigate your options Automate when possible Centralize processes Stay up-to-date on new options Partner with your clearinghouse Think outside the box Keep an open mind Reference: http://caqh.org/eft_enrollment.php
MEASURING REVENUE CYCLE PERFORMANCE
Effective Revenue Cycles Are No Accident Measuring Revenue Cycle Performance What s important? Reporting Analysis Tracking and acting
Measuring Revenue Cycle Performance What is important? Collections Cash in the door Encounter rates or FFS Capitation/PMPM Production Units to produce the cash
Measuring Revenue Cycle Performance What is important? Collections! A/R Charges, payments, & adjustments Provider Practice Days outstanding Payer mix Collections per RVU Service line Provider
Measuring Revenue Cycle Performance What is important? Collections Payments Third party Underpayments Denials and rejections Patient TOS collections Commitment to payment plans
Measuring Revenue Cycle Performance What is important? Collections Credit balances Patient Third party Bad debt % bad debt to total revenue Collection agency recovery
Measuring Revenue Cycle Performance What is important? Production! CPT/RVU production Location Provider Case mix Location Provider
Measuring Revenue Cycle Performance
Measuring Revenue Cycle Performance Reporting and analysis Audience Content Presentation method Frequency
Measuring Revenue Cycle Performance Reporting and analysis Audience - Providers Short & sweet Personalized Audience - Executive Broader content Presentation method Narrative Columnar Graphical
Measuring Revenue Cycle Performance Reporting and analysis Daily Denials and rejections TOS collections Appointments with no charges EFT/ERA reconciliations Weekly Third party underpayments TOS collections
Measuring Revenue Cycle Performance Reporting and analysis Monthly Charges/payments/adjustments CPT/RVU utilization Denials and rejections summary Bad debt Credit balances Patient underpayments
Measuring Revenue Cycle Performance Reporting and analysis Quarterly Capitation plan performance Payer mix Charges Payments Annually Fee schedule assessment Capitation plan performance Budgeted revenue vs. actual revenue Budget production vs. actual production
Measuring Revenue Cycle Performance Tracking and acting KPI Data point or criteria Benchmark Type of KPI Data point to measure results against Internal or external
Measuring Revenue Cycle Performance Tracking and acting Why use KPI s? Measure what s important Identify trends Compare progress to expectations Incentivize desired behaviors
Measuring Revenue Cycle Performance Tracking and acting Which KPIs do you use? % Co-pays collected vs. total possible co-pays Charge lags Office visits Off-site services % clean claims Unbilled charges Staff production Non-contractual write-offs Payer mix
Measuring Revenue Cycle Performance Tracking and acting How do you use KPI s? Dashboard Snapshot summary of key results» Internal benchmarks Historical» External benchmarks Marketplace Industry
Measuring Revenue Cycle Performance Tracking and acting Dashboard Decide what s most important Identify the data point to measure Identify the benchmark for comparison Design dashboard to meet your practice s needs Populate dashboard Act on variances to the benchmark
Measuring Revenue Cycle Performance Key Indicators Indicator Calculation Significance Frequency Trend Gross Days Receivable Outstanding (DRO) Gross Calculation Ratio Net Collection Ratio % Insurance A/R 90+ Days Total A/R divided by Average Daily Charge Total YTD Payments divided by Total YTD Charges Total YTD Payments divided by Total YTD Charges less YTD Contractual Adjustments Insurance A/R greater than 90 days divided by Total Insurance A/R Indicates how long it takes to convert a claim into cash. Monthly Should be downward trend- Less than 30 Indicates proportion of charges that are converted to cash. Monthly Should be upward trend. Indicates effectiveness of collection efforts on potential dollars, including point of service payments. Monthly Low proportion indicates that accounts are collected effectively. Monthly Should be upward trend. 96% or greater. Should be downward trend- Less than 10%
Measuring Revenue Cycle Performance
Measuring Revenue Cycle Performance $140,000.00 Month Charges Adjustments Payments Feb-12 $ 52,055.00 $31,614.00 $47,339.00 Mar-12 $ 86,907.00 $37,568.00 $48,464.00 Apr-12 $105,678.00 $39,273.00 $54,717.00 May-12 $ 98,696.00 $46,484.00 $60,494.00 Jun-12 $ 96,436.00 $36,220.00 $47,903.00 Jul-12 $ 98,920.00 $51,498.00 $68,210.00 Aug-12 $ 99,147.00 $38,574.00 $53,583.00 Sep-12 $114,955.00 $31,091.00 $46,277.00 Oct-12 $120,458.00 $63,241.00 $78,275.00 Nov-12 $ 85,598.00 $41,123.00 $55,719.00 Dec-12 $ 99,943.00 $47,073.00 $60,816.00 Jan-13 $117,800.00 $47,919.00 $64,025.00 Feb-13 $ 84,708.00 $35,377.00 $47,559.00 $120,000.00 $100,000.00 $80,000.00 $60,000.00 $40,000.00 $20,000.00 $- Analyze charges, adjustments & payments monthly. Correlate with practice/provider production. Charges Adjustments Payments
Measuring Revenue Cycle Performance Start here tracking results Date of Claim submission to Payer Adjudication Date of Payer Adjudication to Patient Statement/Denial Worked and resubmitted DOS to date of documentation (DOD) Date of Charge Entry to Claim Submission Total Lag Time from DOS to Fully Adjudicated Date of Documentation to date of coding (if not utilizing CAC) Date of Coding to Date of Charge Entry
Physicians Role in Revenue Cycle Excellence Where Do You Fit In?
Effective Revenue Cycles Are No Accident What Does an Effective Revenue Cycle Mean? Communication Efficient processes Effective procedures Optimal systems utilization Effective use of resources Attentive management
Effective Revenue Cycles Are No Accident Maximum return on investment in accounts receivables. More Revenue. More Quickly!
Anders Health Care Services Anders Health Care Services optimizes staff, resources and revenue for hospitals and physicians by offering solutions and direction to complex practice management issues. We provide an integrated approach from the financial, operational, compliance and strategic perspectives.
Anders Health Care Services Jerrie K. Weith, MBA, FHFMA, CMPE, CMOM 314-655-5558 jweith@anderscpa.com