Today’s healthcare environment presents many unique challenges that can get in the way of independent practices’ ability to remain profitable without making sacrifices to care quality or work/life balance. Billing tops the list as one of the most time-consuming and complex tasks your practice needs to manage.
A 2018 report by the National Health Insurer reported the average practice loses 5 to 12% of revenue due to errors. Some of the major reasons behind these losses are the lack of proper training for employees, constant regulatory changes, and technological advances requiring heavy investments. All of this takes a toll on your practice.
An effective revenue cycle management service can address these issues, reduce the burden on your practice, and optimize your revenue. For that reason, revenue cycle management services provided by a trusted partner like eMDs have increased dramatically in popularity.
Here are 5 reasons you may want to consider a revenue cycle management partner for your practice.
Your Staff Works Too Much
Providing high quality care during regular office hours is tough enough. Doing so while trying to keep abreast of all the back-office work to keep your cash flowing is, these days, nearly impossible. If you have billers, office managers, and/or providers that are staying at their desks for hours after the doors close, or are bringing crates of claim forms home with them when they leave, it may be a sign that your office could benefit from partnering with an RCM services provider.
By utilizing RCM services, much of that back-office busywork keeping your staff from leaving the office can be offloaded to experts who can address it while you go home to dinner with your families.
Your Cash Comes in Too Slowly
Whether it comes from patients paying their outstanding balances or insurance companies reimbursing you for your services, your office is paid for its services most of the time well after those services are rendered (and well after the costs for providing those services are incurred). Therefore, getting paid back quickly is extremely important to remaining profitable.
Look at your Accounts Receivable (AR) to get an idea of just how quickly you are being paid. How much of your AR is less than 30 days old? How much is over 90 days old? RCM services exist to accelerate those payments and minimize the length of time your AR stays AR before it becomes cash in your pocket.
Your Rejections and Denials Are Too High
Claim rejections and denials speak to a great many issues that may be present in your practice. For one, rejected or denied claims are not paid. This quite frankly means that they are money left on the table. Second, rejections and denials could speak to a lack of staff expertise or a need for staff training. Finally, rejections and denials require time to correct and resubmit – the more you have, the more time your practice spends correcting them.
The good news in this case is that RCM services can help with all these potential problems. If your rejection and/or denial rates are high, the experts providing your RCM service can maximize claim accuracy and, thus, minimize your rejection and denial numbers. Further, as discussed above, they can collect your money quickly as well as work those claims that are rejected on your behalf, taking the time burden off your practice’s plate.
You Should Be Monitoring Financial Performance, But Aren’t
Without measurement you can’t improve. There are several industry benchmarks your practice should be looking at to help you determine the financial “health” of your practice.
For example, you want to understand your Accounts Receivable. Your AR represents how quickly your practice is paid for the services it provides. Look at your AR balances for all payers as well as your outstanding patient balances, and how these trend month-over-month. An upward trending patient AR balance could speak to the need to improve patient collections efforts. Also, pay careful attention to your AR Aging. What percentage of your AR is less than 30 days old? Greater than 90? Older AR is harder to collect, and a rising trend in 90+ day old AR speaks to problems in your practice’s collections efforts. MGMA recommends your 90+ day old AR to be less than 14% of your total AR. Is your practice meeting that benchmark?
A good RCM partner will be backed by a strong analytics platform that can analyze your practice data and benchmark it against the previous month’s performance as well as industry standards. These insights should come with actionable advice on how to make improvements for better results during the next review.
You are Having Difficulty Managing the Nuances of Medical Billing
Medical billing grows more complex every year, and unless you have a regulatory and payment expert in house, you are probably struggling to keep up with all the changes in the rules and requirements. The truth is you didn’t enter medicine for the joy of managing your AR or denied claims.
An RCM Service allows you to get back to the joy of practicing medicine. The Revenue Cycle Management team that is assigned to your practice is a team of experts whose sole job is managing billing operations. This team of regulatory and payment experts work your billing cycle from claims generation, to payment posting, to insurance collections, plus much more.
RCM Services Don’t Mean You Lose Control
When practices think of RCM services, it is often equated with the term “outsourcing.” Outsourcing carries some fear for many independent practices. It implies a loss of control or autonomy. But, with a good RCM partner that’s not the case. At eMDS we view our RCM services as a partnership. Our team is here to lift the operational burden off your practice while working in lock step with your team to improve revenue performance and overall practice performance. We believe in full transparency using open systems that give you access to detailed reporting. You remain in full control of your business.
RCM services are on the rise in healthcare right now, and for good reason. By adopting RCM services from a reputable organization, you can improve your bottom line while also streamlining productivity in your office. If you take a look at your staff productivity, payment velocity, and rejection rates, KPIs, and skill set, you may determine that RCM is right for you.