Author: Harper Dion
Posted Date: June 6, 2023
Agencies of all sizes are liable to face risk due to under-optimized operations. In the world of post-acute care, a common issue that staggers an agency’s profits and progress arises within the revenue cycle, specifically mistakes within Revenue Cycle Management (RCM). Revenue Cycle Management is used by care providers across the country to track patient revenue from beginning to end. Overall, healthcare RCM is the process responsible for payment following quality care. This essential process sounds straightforward enough, however there are many hidden nuances within the cycle that commonly receive sub-optimal attention, ultimately leading to staggered profits, slowed progress, and lack of agency compliance. Luckily, actions exist to optimize these processes to, upgrade RCM practices and improve the satisfaction of the entire agency.
It is important for agencies to ensure their bases are covered through an extensive pre-claim review. A pre-claim review is essentially preliminary protection through charting, documentation, and best practices by nursing staff. Compliance must occur before care begins. It is the first step in RCM. An extensive pre-claim review process happens at the patient level; the care practitioners filling out charts must ensure data is collected and documented with utmost confidence, complying with regulations and rulings. This necessary action ensures all billed services are essentially immune to audits after they have entered the revenue cycle. Following an extensive and compliant pre-claim review, the focus shifts towards optimizing every level of the revenue cycle to reach its full potential of RCM excellence.
The backbone of the RCM process exists within billing, the phase where agencies collect payment for services provided. In a post-acute context, payment is received from large payor entities such as Medicare. To optimize the billing process, it is important for agencies to satisfy payor requirements. This can involve knowing specific criteria, such as coverage policies and authorization requirements, and ensuring that all billing documentation meets these requirements. Failure to comply with payor requirements results in claim denials, delayed payments, and even potential legal issues. With a comprehensive understanding of specific payor requirements, the opportunity to further refine the billing process materializes through the following:
Agencies enter the collections phase following the billing process. This phase refers to collecting any outstanding payments from patients, insurance companies, or any other payor entity. To streamline this process, agencies must establish a strong follow-up strategy with payors. This begins with a robust contracting strategy to ensure mutual agreement over timeframe and collections is upheld. Following up on collections, due diligence to review outstanding balances will further polish this process. Creating standardized methods to review outstanding balances can help eliminate errors and increase profits. After a fully optimized collections process is in place, strong management is essential to maintain stability. This involves developing and implementing policies and procedures to streamline the collections process, tracking, metric analysis, and continuous improvement, ultimately maximizing revenue, and minimizing the risk of bad debt.
Erroneous documentation work leads to claims denial which invalidates the entire process leading up to submission. Denials occur when a payor entity rejects submitted claims due to a plethora of reasons including, but not limited to, missing or incorrect information, coding errors, and failed criteria. Reducing denials is an essential step to uphold healthy RCM practices and prevent unnecessary costs. A comprehensive action plan against denials is the best practice to eliminate this nuisance, and it begins with staff training and education. Ensuring an agency’s staff remains up to date with changing regulations and rulings will tighten documentation and increase compliance. From there, the implementation of a structured denial management program empowers management to quickly address the root causes of remaining denials, while establishing the framework for a denial-free RCM process.
Increasing Reimbursement – Renegotiating Rates
Once the revenue cycle runs smoothly, agencies can shift focus to refining and perfecting the process. During this refinery period, the opportunity to renegotiate payor rates and increase reimbursements presents itself. Agencies with a fully compliant revenue cycle should prioritize intensive data collection on the full range of provided services. Leveraging this data to gain a comprehensive overview of operations, an outline of costs and dollar allocation acts as a bargaining chip to renegotiate rates. This opportunity empowers agencies to take the final step, maximizing profits and positive payor relations, while overhauling agency satisfaction and productivity.
The MHA Difference
Revenue Cycle Management is a complex process, from pre-claim review through collections and reimbursement; there exists countless opportunities for improvement and streamlining. “Agencies in today’s fast-moving environment need to think broadly about their revenue cycle. We see successful organizations examining all obstacles to growth within the branch, enabling a robust intake, and ensuring efficient claims processes,” said Director of Finance and RCM Consulting at MHA, Eddie Vetter. This process is multifaceted and difficult, but MHA is here to help agencies maximize their success. Our suite of RCM services provides a comprehensive start point to identify areas of contention while formulating data-backed plans for improvement. From there, our team implements changes and best practices, training your staff to reach new heights in RCM excellence. If you’re interested in learning more about best practices in RCM or would like to schedule an assessment visit www.maxwellhca.com or contact us at [email protected].