Accelerating your revenue cycle webinar series Draft 2 _ 072013

Accelerating your Revenue Cycle:From Patient Encounter Through Account Resolution

Chastity D. Werner, RHIT, CMPE, NCP

NextGen Educational SeriesJuly 22, 2014

Learning Objectives

Characteristics of Best Performers

Efficient Encounters = Revenue Cycle Success

Measuring Revenue Cycle Performance

Identifying Your Opportunities

Accelerating your Revenue Cycle:

Characteristics of Best Performers• Technology• Staff• Payers• Process

From Patient Encounter Through Account Resolution


Technology• Systems

Interface when possible Efficient templates


Technology• HIE


Technology• EHR/PMS communicate• Upgraded regularly• Continued education• Embrace new opportunities

Schedulers

Efficient, strong phone & customer service skills, understands billing process, well trained in patient collections and payer policies and procedures.


Staff• Right fit• Productivity• Weekly meetings

Front desk

Smiles, friendly, efficient, multi-tasking abilities, high energy, strong communication skills, organized, well trained in patient collections.

Set expectations:

They represent your officePatients are firstTeam environmentBilling issues affect all departments

Reasons for underproduction

Do not know what to do

Do not know how to do it

Do not know why they are doing it

My way is better

Something else is more important

I must be doing it, you left me alone

I am rewarded for not doing it

Weekly meetingCharges/payments

Payer updates/changes

Patient issues

Upcoming events

Training

Areas of concern

End it on a positive note!

Always follow-up on questions/concerns

Time to huddle….let’s go team!


Staff• Team player• Reinvest• The “Why” factor

THE

“WHY” FACTOR


“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.”

Mini-Max Principal

Reference: Rosemarie Nelson MGMA Healthcare ConsultantThe ROI of IT: Best Billing Practices


Payers• Credentialing• Payment rules• Appeal process• Stay up-to-date

http://www.ama-assn.org/ama/pub/physician-resources/practice-management-center/health-insurer-payer-relations/payer-specific-information.page?

http://www.ama-assn.org/ama/pub/physician-resources/practice-management-center/health-insurer-payer-relations/payer-specific-information.page

http://www.ama-assn.org/ama/pub/physician-resources/practice-management-center/health-insurer-payer-relations/payer-specific-information.page


Payers• Pre-auth/Pre-cert rules• Contracted fee schedules• Electronic options• User names & passwords

Reference: AMA 2012 National Health Insurer Report Card


Process• Does it make sense?• Uniform• Set expectations• Policies & procedures

Standardized Update regularly

EFFICIENT ENCOUNTERS = REVENUE CYCLE SUCCESS

Accelerating your Revenue Cycle:

Efficient encounters• Scheduling• Eligibility & benefits verification• TOS• Claims generation• Payment processes• Account resolution• Collection process



SchedulingCapture the right information

Account review

Patient expectations

Patient demographics

Work #, cell phone, email

Guarantor details

Employer information

Insurance details

“Ms. Smith,I see you have a past due amount of

$50.00. How would you like to take care of that today? We accept Visa,

MasterCard, or do you have an FSA?”“We expect payment at the

time of service. ”

Sources: (left) Kaiser Family Foundation/Health Research and Educational Trust, Employer Health Benefits Annual Surveys, 1999–2012; (right) authors’ estimates based on CPS ASEC 2001–12, Kaiser/HRET 2001–12, CMS OACT 2012–21.

Projected average family premium as a percentage of median family

income, 2013–2021

Cumulative changes in insurance premiums and workers’ earnings,

1999–2012%%

180%

47%

38%

Projected

172%


Eligibility & Benefits


Eligibility & Benefits

Percentage of Covered Workers Enrolled in a Plan with a General Annual Deductible of $1,000 or More for Single Coverage

Note: These estimates include workers enrolled in HDHP/SO and other plan types. Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 2006-2010.

“National health expenditures are expected to increase from $2.9 trillion to $5.5 trillion. Business and households are projected to pay half of total nation health care costs in 2023, while the federal government will pay 32% and state and local governments will pay 18%.

Confronting Costs: Stabilizing U.S. Health Spending While Moving Toward High Performance Health Care System. 2012


Reference: InstaMed Trends in Healthcare Payments Annual Report: 2012

% of providers who knew

patient responsibility at

the TOS

% of patients who knew their

financial responsibility

It costs between $0.05-$0.74 to check

eligibility

How much will it save you to know what your

patient owes at the TOS?

Eligibility & BenefitsVerification


Reference: http://www.aetna.com/provider/medical/service_med/electronic_med/edi_calculator/EDI_Savings_Calc.html

Eligibility & benefits verification• Increase time with patients• Faster payments• Increased efficiency


Eligibility & Benefits Verification

Automate

Centralize

Payer websites

Is it worth it? Choose your criteria:ServicesPayers

Everything

Use the information obtained!

3 days in advance


Compare coverage toexpected treatment & fee schedule

Contact patient– patient counseling

Set alerts in system & schedule

Collect at TOS

Eligibility & Benefits Verification


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.”


“If patient payments are not managed correctly, they can cost three to five times more to collect than payer payments due to paper-based, manual processes.

These costs are further escalated by rising patient bad debt, which was estimated to have been more than $65 billion in 2010.”

High deductible health plans have increased from1,000,000 to over 11,000,000 since 2005.

TOS Collection % for Providers

Reason the provider did not collect


TOS


TOS• Complete record 24 hours• Computer Assisted Coding (CAC)• Interface charges

Do your providers override the

suggested codes?


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?


Utilize a clearinghouse

Submit charges within 24-48

hours

Initial follow-up24 hours

Level 1 rejections

997 claim rejection report

277u claim status report


Payment Processing

Reconciliation

ERA/EFT

PPACA

Zero pays

Automate

46%51%

6% increase over 2 year period


Reason payer payments were not

received electronically


Reference: www.cms.gov/.../HIPAA-Administrative-Simplification/.../Deadlines-and...

Payment processing• PPACA

http://www.cms.gov/.../HIPAA-Administrative-Simplification/.../Deadlines-and









Reference: AMA 2012 National Health Insurer Report Card

Payment Processing

96 – Non-covered charge(s). At least one Remark Code must be provided.

Claim Adjustment Reason Codes

(CARC)

Claim adjustment reason codes communicate an adjustment, meaning that they must communicate why a claim or service line was paid differently than it was billed. If there is no adjustment to a claim/line, then there is no adjustment reason code.

16 – Claim/service lacks information which is needed for adjudication. At least one Remark Code must be provided.

www.wpc-edi.com/reference/codelists/healthcare/

204 – The service/equipment/drug is not covered under the patient’s current plan.

http://www.wpc-edi.com/reference/codelists/healthcare/


Reference: AMA 2012 National Health Insurer Report Card www.wpc-edi.com/reference/codelists/healthcare/

Remittance Advice Remark Codes (RARC)

Remittance Advice Remark Codes (RARCs) are used to provide additional explanation for an adjustment already described by a CARC or to convey information about remittance processing. Each RARC identifies a specific message as shown in the RARC List. There are two types of RARCs- majority are supplemental to the CARC codes, but some are for information purposes only.

N130 – Consult plan benefit documents or guidelines for information about restrictions for this service.

N179 – Additional information has been requested from the member. The charges will be reconsidered upon receipt of that information.

Payment ProcessingN386 – The decision was based on a National Coverage Determination (NCD). An NCD provides a coverage determination as to whether a particular item or service is covered. A copy of this policy is available at www.cms.gov/mcd/search.asp. if you do not have web access, you may contact the contractor to request a copy of the NCD.

http://www.wpc-edi.com/reference/codelists/healthcare/

http://www.cms.gov/mcd/search.asp


Payment Processing• Contractual • Non-contractual• Post all zero pays• Utilize system automation• Reconciliation


Payment processing• Reconciliation Process:

1) Separate deposits 2) One batch per deposit (i.e. ERA/EFT) 3) Uniform batch description

» (i.e. $34,584.03 Anthem 5/6/2013) 4) Match to bank deposits to system

» Download each into Excel format» Data sort by dollar amount» Utilize other data to compare if needed


Patient Statements• Electronic statements

Cost 58% less than paper

• Make it convenient• Two statements

Day 0 Day 30

• Collection letter Day 60• Day 75 turnover

E-statements save providers approximately 42% compared

to paper statements.

In paying their medical bills electronically

It is estimated that consumers in the U.S. will spend more than

$300 billion online in 2016.

Increased 7% from 2011-2012

% of patients receiving

medical bills via email

Reference: InstaMed Trends in Healthcare Payments Annual Report: 2012Reference: Gartner Group, HFMA, and HH&N Research


Account resolution• 24 hours after submission• Universal note area• 277/997 reports• Automate when possible• Appropriate reports• Review notes & tasks• 14-21 days clearinghouse• 31+ days payer website/phone

Payer

High $$$ Down

DOS

Group by Patient

Report Criteria

______________


Denied Claims

Submitted Claims=

Denial Rate


100 claims a day X 20 days a month

2,000 claims

20% denial rate

2,000 claims X 20% = 400 claims

33% of denials are never recovered

400 X 33% = 132

132 X $100.00 (average reimbursement) = $13,200 monthly

Source: The Physician Billing Process: 12 potholes to avoid in the road to getting paid, ed 2, Walker-Keegan, Woodcock, Larch.13

$158,400 Annually


Source: The Physician Billing Process: 12 potholes to avoid in the road to getting paid, ed 2, Walker-Keegan, Woodcock, Larch.13

$10.67 staff time

$ 1.50 supplies

$ 1.75 interest

$ 1.00 overhead_______________________

$14.92

$14.92x 400

$5,968Monthly

_______$5,968x 12

$71,616Annually

________

Cost of working denials


Denial Management

Should it be written off?

Contractual versus non-contractual

adjustment

Is a correction needed?

If so,correct & resubmit!

Should it be appealed?

Collect data, follow payer process,

involve patient & track status


Collection process• Automate process• Monitor results• Write-off at turnover

Write off utilizing specific code; create reports by specific code to track

agency results.

Advanced Staff Training

Eligibility

Cost Estimation

Counsel Patient

TOS Collection

Bad Debt Collection Process

Dismissal Process


Reference: http://caqh.org/eft_enrollment.phpCAQH Universal EFT Enrollment

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

Keep an open mind

Think outside the box

MEASURING REVENUE CYCLE PERFORMANCE

Measuring Revenue Cycle Performance• What is important?• Reporting and analysis• Tracking and acting



What is important?• Collections

Cash in the door

• Production Units to produce the cash


What is important? Collections!• A/R

Charges, payments, & adjustments– Provider– Practice

Days outstanding Payer mix Collections per RVU

– Service line– Provider


What is important? Collections• Payments

Third party– Underpayments– Denials and rejections

Patient– TOS collections– Commitment to payment plans


What is important? Collections• Credit balances

Patient Third party

• Bad debt % bad debt to total revenue Collection agency recovery


What is important? Production!• CPT/RVU production

Location Provider

• Case mix Location Provider


“You cannot manage what you do not

measure.”

“In Search of Excellence” Tom Peters


Reporting and analysis• Audience• Content• Presentation method• Frequency


Reporting and analysis• Audience - Providers

Short & sweet Personalized

• Audience - Executive Broader content

• Presentation method Narrative Columnar Graphical


Reporting and analysis• Daily

Denials and rejections TOS collections Appointments with no charges EFT/ERA reconciliations


Reporting and analysis• Weekly

Third party underpayments TOS collections


Reporting and analysis• Monthly

Charges/payments/adjustments CPT/RVU utilization Denials and rejections summary Bad debt Credit balances Patient underpayments


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


Tracking and acting• KPI

Data point or criteria

• Benchmark Type of KPI Data point to measure results against Internal or external


Tracking and acting• Why use KPI’s?

Measure what’s important Identify trends Compare progress to expectations Incentivize desired behaviors


Tracking and acting• KPIs

% Co-pays collected vs. total possible co-pays Charge lags

– Office visits– Off-site services

Budgeted charges % clean claims Unbilled charges Staff production standards Denials Payer mix


Tracking and acting• How do you use KPI’s?• Dashboard

Snapshot summary of key results– Internal benchmarks

» Historical– External benchmarks

» Marketplace» Industry


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


Key IndicatorsIndicator Calculation Significance Frequency Trend

Gross Days Receivable Outstanding (DRO)

Total A/R divided by Average Daily Charge

Indicates how long it takes to convert a claim into cash. Monthly

Should be downward trend- Less than 30

Gross Calculation Ratio

Total YTD Payments divided by Total YTD Charges

Indicates proportion of charges that are converted to cash. Monthly Should be upward trend.

Net Collection Ratio

Total YTD Payments divided by Total YTD Charges less YTD Contractual Adjustments

Indicates effectiveness of collection efforts on potential dollars, including point of service payments. Monthly

Should be upward trend. 96% or greater.

% Insurance A/R 90+ Days

Insurance A/R greater than 90 days divided by Total Insurance A/R

Low proportion indicates that accounts are collected effectively.

MonthlyShould be downward trend- Less than 10%

Identify KPIs and Benchmarks


Tracking and Acting


Month Charge Amount Adjustment Amount Payments

Jan-11 $ 47,163.00 $ 3,756.00 $ 8,545.00

Feb-11 $ 74,423.00 $ 18,543.00 $33,769.00

Mar-11 $ 88,231.00 $ 36,833.00 $56,173.00

Apr-11 $ 79,734.00 $ 35,148.00 $59,501.00

May-11 $ 80,554.00 $ 18,787.00 $43,334.00

Jun-11 $ 77,603.00 $ 30,781.00 $55,724.00

Jul-11 $ 83,068.00 $ 29,480.00 $59,983.00

Aug-11 $ 71,680.00 $ 18,202.00 $36,654.00

Sep-11 $ 91,644.00 $ 28,819.00 $55,324.00

Oct-11 $ 84,040.00 $ 29,118.00 $53,786.00

Nov-11 $ 68,435.00 $ 36,704.00 $54,793.00

Dec-11 $ 98,092.00 $ 29,624.00 $52,754.00

$40,544 $40,575 $40,603 $40,634 $40,664 $40,695 $40,725 $40,756 $40,787 $40,817 $40,848 $40,878

$- $50,000 $100,000 $150,000

Payments

Adjustment Amount

Charge Amount

Decrease in charges one month means decrease in

payments succeeding month!

Tracking and Acting

Analyze charges, adjustments & payments monthly. Correlate with practice/provider production.


Payment Analysis Payer Name Encounter Chg Amt Count Adj Amt Allowed Amount Fee Schedule Variance99204 Anthem Blue Choice PPO 15302 $225.00 1 -$105.00 -$120.00 $125.93 -$5.9399204 Anthem Blue Choice PPO 15536 $225.00 1 -$102.00 -$123.00 $125.93 -$2.9399204 Anthem Blue Choice PPO 16075 $225.00 1 -$102.00 -$123.00 $125.93 -$2.9399204 Anthem Blue Choice PPO 16077 $225.00 1 -$102.00 -$123.00 $125.93 -$2.9399204 Anthem Blue Choice PPO 16078 $225.00 1 -$102.00 -$123.00 $125.93 -$2.9399204 Anthem Blue Choice PPO 17630 $225.00 1 -$185.00 -$40.00 $125.93 -$85.9399204 Anthem Blue Choice PPO 17631 $225.00 1 -$185.00 -$40.00 $125.93 -$85.9399204 Anthem Blue Choice PPO 17721 $225.00 1 -$139.07 -$85.93 $125.93 -$40.0099204 Anthem Blue Choice PPO 17722 $225.00 1 -$139.07 -$85.93 $125.93 -$40.0099204 Anthem Blue Choice PPO 18002 $225.00 1 -$205.00 -$20.00 $125.93 -$105.9399204 Anthem Blue Choice PPO 18121 $225.00 1 -$100.42 -$124.58 $125.93 -$1.3599204 Anthem Blue Choice PPO 18179 $225.00 1 -$99.07 -$125.93 $125.93 $0.0099204 Anthem Blue Choice PPO 18203 $225.00 1 -$99.07 -$125.93 $125.93 $0.0099204 Anthem Blue Choice PPO 18363 $225.00 1 -$100.42 -$124.58 $125.93 -$1.3599204 Anthem Blue Choice PPO 18715 $225.00 1 -$99.07 -$125.93 $125.93 $0.0099204 Anthem Blue Choice PPO 18821 $225.00 1 -$99.07 -$125.93 $125.93 $0.0099204 Anthem Blue Choice PPO 18862 $225.00 1 -$139.07 -$85.93 $125.93 -$40.0099204 Anthem Blue Choice PPO 19051 $225.00 1 -$99.07 -$125.93 $125.93 $0.0099204 Anthem Blue Choice PPO 19605 $225.00 1 -$100.42 -$124.58 $125.93 -$1.3599204 Anthem Blue Choice PPO 19734 $225.00 1 -$99.07 -$125.93 $125.93 $0.0099204 Anthem Blue Choice PPO 19755 $225.00 1 -$99.07 -$125.93 $125.93 $0.0099204 Anthem Blue Choice PPO 19867 $225.00 1 -$99.07 -$125.93 $125.93 $0.0099204 Anthem Blue Choice PPO 20213 $225.00 1 -$99.07 -$125.93 $125.93 $0.00

•Run CPT report for date span, by appropriate payer, & including “Allowed Amount” •Export the file from PMS to Excel•Insert column with allowed amount if needed•Create conditional formula to identify variances

Compare “allowed amount” not paid

amount

DOS to date of documentation

(DOD)


Start heretracking results

IDENTIFYING YOUR OPPORTUNITIES

Identifying Your Opportunities• Assess the situation

Revenue cycle assessment System assessment

• Prioritize the opportunities• Develop plan for capitalizing• Implement plan• Monitor and track results



Revenue cycle assessment• Lost revenue• Staff productivity and quality• Provider documentation• Payer billing issues• Common denials• Missing links in process


Revenue cycle assessment• Select span of time

90, 120 or 180 days?

• Set expectations Charge lag time

– 24 hours Bill lag time

– 48 hours Claim note

– 30 days Work denial

– 24 hours Collection agency turnover

– 90 days from patient responsibility


Patient Name (L, F) Payer DOS Code(s) Charges DCE DCFDate Paid Paid Adj. Balance Activity Status Rating

1 2 3 4 5 6 7 8 9

10 11 12 13 14 15

TotalAverage

Legend:DCE - Date Charge EnteredDCF - Date Claim Filed

Tracking Results


System assessment EHR PMS Interfaces

• Set criteria

Accelerating your Revenue Cycle

What Does An Accelerated Revenue Cycle Mean?• Communication• Efficient processes• Effective procedures• Optimal systems utilization• Effective use of resources• Attentive management


Accelerating your Revenue Cycle

What Does An Accelerated Revenue Cycle Mean?

Maximum return on investment on accounts receivables.

More Revenue.

More Quickly!


Accelerating your Revenue CycleFrom Patient Encounter Through Account Resolution

www.anderscpa.com/webinar-series

September 18

Sustainable Compensation Models that Incentivize: Trends & Examples

November 6

Operational Effectiveness and Profitability: Identifying and Prioritizing Opportunities

December 4Keeping the Financial Pulse of Your Practice Healthy: Benchmarking and Trends

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.


Jerrie K. Weith, FHFMA, CMPE

314-655-5558

[email protected]

Chastity D. Werner, RHIT, CMPE, NCP

314-655-5561

[email protected]

mailto:[email protected]



Jessica Johnson [email protected]

Brian McCook [email protected]

John McGuire [email protected]

Brian Meyers [email protected]

314-655-5500

www.andershealthcare.com





http://www.amdhealthcare.com/

Documents

Accelerating your revenue cycle webinar series Draft 2 _ 072013