Since the start of the Covid-19 pandemic, healthcare has experienced fundamental shifts in delivery capabilities and administrative support services. Revenue streams have been directly impacted by reduced or eliminated elective and non-emergency procedures. Additionally, revenue cycle managers had to quickly pivot to understand and support virtual and telemedicine billing guidelines that had either not been published or were changing by the minute, all while team members made an immediate shift to working remotely, many times without the infrastructure to support them.
At the height of the crisis, a staggering fifth of the world’s population has been under some form of lockdown. What is the best way to make sure that your now-remote medical billing staff is working as efficiently as possible? How do you ensure that productivity doesn’t slip? As countries reopen, and the demand for healthcare around the world increases, how will your revenue cycle model evolve?
We’re experts in medical billing processes and systems and want to share these important steps to help your team succeed. In this article, we’ll outline the steps you need to take for responding to this change, and the key metrics for measuring your billing staff!
Step 1: You need a plan
The first step in developing a solid plan for your medical billing and revenue cycle team is to accurately understand and report on your unpaid claim inventory. It’s not good enough to just know how many dollars you have unpaid on your A/R today. You need to understand the volume of claims (inventory) so that you can understand how many claims need to be worked each day/week/month, and to effectively divide and allocate that work to your team members. Having a clear picture of your unpaid claim inventory alongside the unpaid dollars associated with that inventory will allow you to assess available cash in your existing accounts receivable that can be collected to compensate for a downswing and visit volume on the front end due to the cancellation of elective procedures or visits.
Step 2: Prioritize High Yield Claims
Once you’ve identified and inventoried your unpaid claim balances, the next critical step is to prioritize high-yield claims. It’s important to work on claims that can be paid immediately. There may be larger projects (e.g. credentialing or other known issues) that you cannot resolve during this time, so focusing on claims that are immediately collectible should be your priority. Conversely, if you are seeing a large downswing in new charges, now may be the time to get those projects cleaned up. Anything you can do to offset a downturn in charges will help.
Step 3: Allocate the work to your team and track progress
Once you’ve identified, analyzed, and prioritized your claim inventory, you can begin to allocate the work to your team. If your team is working manually or from spreadsheets, this can be extremely tedious. As with any plan, tracking team productivity and setting daily/weekly/monthly goals ensures that the plan is getting successfully executed. Tracking user activities can help you understand daily and weekly trends, and when your team members operate at peak performance. It can also help you identify where there is tension or slack in the team. If you need to reallocate work, this data can be vital.
It’s not enough to have your medical billers just banging on keyboards and resubmitting claims. Team members need to be effective in getting claims paid. Implement solutions that allow you to track outcomes and review actions together. Create new methods of employee engagement by having team members train and help each other. At RevenueHealth, our software-enabled solutions can help you track biller touch and resolution rates so that you know that staff productivity
Worklist Age: This metric tells you how long a claim has been sitting on someone’s list to be worked. For the most part, billers should have a resolution for every claim in less than 14 days. A two-week average allows time for your billers to factor in the more difficult claims that need to be escalated or require input from front-end resources. Reporting also needs to help you isolate problem claims without an immediate resolution available (i.e. Provider Credentialing or Payer Issues) so as not to inflate those numbers.
Touch Rate: Touch Rate measures how many actions were taken on a claim before it was resolved (we’ll define that in a bit). Optimally, every biller’s touch rate should be 1.0 (one action taken by one person to resolve the claim). Each action, transfer, or escalation represents a touch and with each touch, the cost to your billing team goes up. MGMA studies have shown that on average, it costs $25 to resolve a denied claim. If all claims were touched only once and resolved, it’s more likely that cost would be in the $8-$10 range. The higher your touch rate, the more it is costing you to get your claims paid.
Claim Resolution Rate: A resolved claim does not need any further action to collect payment or be adjusted. Understanding the percentage of unique claims that each biller has worked to “resolution” helps you understand the quality of actions your team is taking. Claim Resolution Rate differs from Touch Rate in that it measures the percentage of unique claims (vs. actions alone) that have been worked for resolution and therefore a higher percentage is better. Optimally you want team members with a low touch rate and high resolution rate.
Rebound Rate: Another factor in the resolution rate is the percentage of unique claims that a biller “resolves” that do not get paid or adjusted. A biller can keep their productivity rates high by resubmitting claims and if those claims are never paid or adjusted, they are just spinning their wheels and running up costs in the meantime. Optimally, rebound rates should not exceed 2-3%, and when you see those instances, they need to be reviewed with the team member to understand what’s causing the rebound.
Paid Claim Rate: At the end of the day, managers need to know that their billers are getting their claims paid. Cash collections are the one measure that everyone cares about, all the way up to the top of the organization. The Paid Claim Rate measures the total number of resolved claims that resolved for payment (Unique Paid Claims / Unique Resolved Claims). It’s very easy to clean up old balances with transfers, adjustments, and write-offs. Make sure you know that claims are getting resolved for a payment. The higher the Paid Claim Rate, the better!
In a perfect world, your billers would only ever touch the claim once and it would get paid. We all know the reality is that 3rd party insurance billing is far from a perfect world. A/R management can be tricky with a diverse payer landscape and seemingly constant change. Even when manual processes are effective, they can be slow and inefficient, and far too often result in claims that age out, produce unnecessary denials, and call for workarounds that cost precious hours that could be spent growing your organization. But change can be intimidating — not least because you don’t know whether new processes will be sustainable. How do you know if the latest, greatest idea will pay off? Will employees be able to clearly understand how to implement new and better practices? And will it make a long-term difference?
Practices that succeed in transforming their A/R management processes consistently see higher cash collections. Those that don’t, continue to find themselves buried under mounds of paper, spreadsheets, and unfiled claims. The pathway to success lies in your data. Using intelligent automation to clearly identify unpaid claim inventory, distribute it to your team, and measure their success can give give the visibility and time to focus on the most critical areas of your revenue cycle.
Our software-enabled services are built by billers for billers, drawing on deep experience with the challenges that your practices face. We design solutions to address issues specific to your business, continually identifying opportunities, presenting technology-enabled personalized service that is tailored to your business, and seamlessly integrating it into your existing operations and technologies.