Every practice’s management is the same. It starts when a sets an appointment, and it ends when the practice receives . Managing your sounds simple enough, but the reality is there are lots of opportunities along the way where simple mistakes can cost your practice money.
For over 20 years ARIA Health Services has been offering services to our customers. Along the way, we’ve picked up a trick or two for establishing RCM best practices. Here are a few best practices to consider when looking to improve your operations.
Prevent Physician Enrollment Issues
Credentialing and enrollment are critical components of . Yet, most practices dismiss these as unimportant. Lapsed credentials or failing to enroll new providers in a timely manner can mean lost , delayed payments, out-of-network services, and denials. It’s important that you consider credentialing and enrollment as part of your big picture and dedicate time and resources to managing this important task.
Mitigate and Manage Denials
Claims denials are a common reason why many practices do not have a . Denials occur for many reasons including a coding error, duplicate claims, lack of information, timely filing issue, eligibility, and more.
Because claims may be denied for a variety of reasons, it is crucial that your practice closely monitor the claims process. Understanding the status of each claim as well as identifying why your claims are denied can help your staff recognize patterns and learn how to prevent mistakes in the future.
Manage Your Accounts Receivable Balances
Knowing your percent of Accounts Receivable (AR) over 90 days is a good indicator of your practice’s ability to collect timely payments. The more AR you are able to keep under 90 days old, the better your cash flow and the healthier your revenue cycle management. Factors that can influence timely include your mix, staff efficiency in addressing denied or aged claims, and the ability to collect payments.
MGMA recommends practices have no more than 12-14% of their AR in the over 90-day segment. High or rising percentages of AR over 90 is a strong indication your practice has a has a denials and follow up problem. Analyze your rejected claims, denials, and contract compliance weekly. Look for trends or patterns that can be adjusted and avoided in the future.
Know Your Days Outstanding
Days outstanding refers to the average number of days it takes your practice to collect payments due. The lower the number, the faster your practice is obtaining . Days outstanding should stay below 50 days at minimum. However, 30 to 40 days is preferable. Depending on the specialty, high performing practices should aim for under 30 days.
Verifying eligibility is an indispensable process when it comes to patients, getting paid by insurance providers, and the overall of practices’ cycle.
With the rise in high-deductible and cost-sharing insurance plans, more and more patients are required to make payments at the time of service, though many patients are unaware of that fact. By using —particularly when done in advance—you can mitigate this problem, allowing you to give patients important information about the costs of their appointments before they come in.
The best time to collect balances is during the check-in or check-out process when the is in front of you and can pay immediately. Studies show that the chance of collecting from a drops almost 20% as soon as the leaves the office and continues to drop with each passing day.
Track Financial Performance
A happy (and financially stable) practice is a practice that maximizes and maintains consistent By analyzing on a regular basis, you’ll gain a deeper understanding of your practice financials, but most importantly, it will help you determine if and where you might be experiencing (KPIs) leaks. . To do that, you must effectively manage your finances.
Some KPIs your practice should consider tracking include:
- Net Collection Rate – In simple terms, your net collection rate tells you what you collect for every dollar billed. It provides insight into how much of your is lost due to factors such as uncollectable debt, delays in claim filing, and other non-contractual adjustments.
- Accounts Receivable Analysis – Calculate your percentage of AR over 90 days. Use your practice system to analyze the AR buckets. This will help you determine if it’s a problem, an insurance problem, or both.
- Days Outstanding – Take a deep-dive into days outstanding. This data determines the velocity of your payments.
- Charge Posting and Lag Analysis – Track this to see how long it takes your to enter a charge and then how long it takes your biller to submit that claim to the insurance carrier.
For those at which you look every month, the most important question to ask is, “How has this changed since last month?” In addition to running your reports, make sure you are using the data they contain to identify problem areas and then develop plans for improvement. The earlier you can spot negative trends, the easier it will be to course correct.
Whether you do your own and collections or use an outside service, using these best practices can help your practice increase , decrease account receivables, reduce expenses, streamline , and most importantly, improve control of your business.
For a full list of our Top Ten , watch our on-demand webinar below. Best Practices