With the introduction of EMR and advanced practice management software, the general belief is that the standards of billing and collection will be like never before, and that every claim should be billed out accurately and collected upon in a timely manner. Unfortunately, according to industry sources, independent medical practices are still leaving as much as 30% of potential revenue on the table due to the inefficiencies in their billing & collection process. This occurs because the rejection and denial rate is still too high, and almost 50% of denials never get re-worked, resulting in 5-7% loss of potential revenue. When you have too many denials, your revenue can pretty easily get locked in the Accounts Receivable, which can have serious impact on your cash flow.
With the cost of running a medical practice constantly going up and the continuous trend of shrinking reimbursements, it has become impossible for any practice to afford leaving money on the table. If you are a practice owner or administrator, and you suspect your practice is doing this, you should enact a comprehensive review of your billing and coding. Typically, this analysis can cost you anywhere between $2000-3000, but this one-time payment is worth it in the long run because you are likely losing an equivalent amount of money on a monthly basis already. At Cosentus, we are always finding ways to give back to the community, so we offer a free comprehensive analysis of your billing and coding.
We not only answer all your questions about your billing and coding, but at the end of the analysis, give you a road map for increasing your revenue. Again, this is a free service with zero obligations! For more information, you can visit our website or simply click the link below to receive your analysis in less than 60 seconds.
Cosentus is a leading provider of optimized medical billing services. We are one of the only true multi-specialty medical billing companies right now. No matter what your area of expertise is, we can service ASC, Anesthesia, Orthopedics, sports medicine & pain management, women’s health, neurology, radiology (including interventional radiology), cardiology, and more with equal efficiency. We have been serving our clients for 19 years now and take lots of pride in transforming their revenue cycles inside-out and providing a much-needed boost to their cashflow.
If you still handle your own billing or outsource to an unconventional type of medical billing company, we have put together a list of 4 of the best practices you can implement to optimize your medical billing and significantly improve your practice’s cash flow.
Perfect Synergy Between Front-end and Back-end Operations
Healthcare revenue cycle can be split into front-end and back-end operations. The greater the synergy between these two, the more seamless your billing and collections will be. Front-end operations generally refer to the smart scheduling of patients, registering new patients, taking authorization, checking eligibility, and collecting other important information, while the back-end operations refers to optimally coding the services rendered, sending claims out, working rejections, tracking claims, working denials, and more. Both are generally worked by separate sets of people, however each individual involved needs to have a solid understanding of the entire process for them to be able to gather and process information most effectively.
Breaking the barrier by cross training employees is a smart way to streamline your revenue cycle. If you outsource to a medical billing company, you can also ask your billing vendor to assist in organizing your front-end operations. You should have a clearly defined workflow for the front desk. Make sure that you are collecting prior balances before giving new service to the patient. Periodic retraining of the front desk employees is highly suggested. It is important that these employees are well versed in your scheduling and EMR systems, as they are the ones who also trigger your billing process.
A loose front desk operation can result in losing patients & revenue, and increased debt & cost of collections. Fine tune your front desk operations to increase your additional revenue by 5-15%.
Track Revenue Cycle Management
You can’t manage what you haven’t measured. Data should drive a revenue cycle, and healthcare is no different. Data can not only clearly point out bottlenecks in accurate and timely reimbursement, but it can also show you the financial wellbeing of your practice and what to expect in the future.
Tracking revenue cycles through key performance indicators has become quintessential for a medical practice. If you outsource your billing, your billing service should be able to track these parameters for you and provide you with a user-friendly dashboard. It is quite obvious why your billing service may not want to share this information with you or put together a dashboard.
We believe tracking the following parameters are absolutely necessary for any practice to maintain a profitable revenue cycle:
- Days in Accounts Receivable – This indicates how long it typically takes you to be reimbursed. A higher number of days in accounts receivable results in a messier cashflow. The number of preferred days in AR will vary depending on your area of medical expertise, however this number should always stay within 50 days, with the ideal number being between 28-35 days.
- Clean Claims Submission – With the technology available today, your clean claims submission should be over 98%. If it is not, it is probably best to ask questions.
- Claims Denial Rate- This is tracked to measure how effective your coding & billing processes are. Your denial rates should be under 6%. That said, in our experience, about 65% of the practices have 14% or more denials, with some having over 25% claim denials. This is why you should outsource your billing to a service like Cosentus– we consistently keep your denial under 6%, ensuring your cashflow is always profitable.
- Denials Write-Off Percentage – According to industry sources, 50% of all denials are never worked and eventually a vast percentage of these are written off. This is your money– you have worked hard to deliver patient care, so the write off should be minimal and only occur when necessary. That said, not all denials can be disputed, so you need a well-defined dispute strategy. For more information on an effective denial management strategy and how to implement preventive denial management, read our blog:
- Cost to Collect- The more efficient your front-end and back-end billing process is, the lesser your cost to collect will be. Therefore, if your cost to collect is higher than expected, you need to fine tune the processes involved.
Prevent Charge Leakage
Missing out on charges is the last thing you want. It can cost you revenue and eat into your profit margins.
Often times the reason for charge leakage is incomplete documentation. Make sure that you take time to fully document each service provided. The most commonly missed charges are X-rays, interpretations, labs, DME, Gait training, and injections. These are all payable services and each time you fail to document one of them, you are leaving money on the table.
It is also critical that you billing service has a strong charge reconciliation process in place to ensure that every charge is being billed out. Similarly, it is equally important to pay attention to how the additional services (apart from E&M) are being paid by the payers. Some payers pay so minimally for medicines that you may actually be paying more to procure the medicines than what is being reimbursed to you. Periodically reviewing your charges for payments is highly advisable. Your billing service should be able to provide you with this analysis and relevant reporting.
Or, speak to Cosentus. We understand your needs!
Patient Financial Responsibility
Insurance plans with high out-of-pockets for the patients are becoming increasingly popular. In exchange for a low premium, patients assume greater financial responsibility for their healthcare bills.
This trend of patients shouldering more healthcare costs has made it imperative for medical practices to manage patient financial responsibility better. Surveys show that in 2017, nearly 62 percent of patients with bills under $500 did not clear their dues. Unfortunately, the number of patients who do not pay their bills is currently on the rise.
Late payments and unpaid bills directly affect the revenue cycle of a medical practice. Not only is payment not received, but staff must spend valuable time and resources on following up with patients in an effort to collect overdue payments.
To address patient financial responsibility, you can implement the following strategies in your revenue cycle:
- Offer multiple payment options at point-of-service and pre-service stages
- Offer financial estimates at the pre-service stage
The ability to offer pre-service price estimates is key, experts say. Surveys show that patients are more likely to meet their healthcare financial obligations if they receive a cost estimate upfront. Software tools are available for medical practices to prepare these cost estimates. These tools rely on historical data to create an estimate of allowable expenses for a specific procedure by a specific payer.
To boost point-of-service collection from patients, medical practices should enforce a policy of credit card information on file. This policy has shown dramatic results, with some organizations seeing a nearly 30 percent drop in accounts receivable within six months of implementation.
Owning and running a medical practice is hectic on its own, and managing a profitable healthcare revenue cycle on top of that can be a lot to ask for. You need a reliable billing partner to consistently help you maintain a profitable cash-flow. Cosentus is one of the only Medical Billing Companies that offers performance guarantee in service level agreements. You don’t deserve just another "out of box" billing company, you deserve something better!
Choose Cosentus. See the change, feel the difference!