8. When to Outsource Revenue Cycle Operations - Turchi. When to Outsource...is a Certified...
Transcript of 8. When to Outsource Revenue Cycle Operations - Turchi. When to Outsource...is a Certified...
4/4/2019
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Presented by Paola Turchi, MSHCA, CHFP, CPC
When to Outsource Revenue Cycle Operations
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About Paola Turchi, MSHCA, CHFP, CPC
Paola has a degree in Business Administration and Master’s in Healthcare Administration, with more than 15 years of experience in Revenue Cycle. She is a Certified Professional Coder through the AAPC, a Certified Healthcare Financial Professional through HFMA and is currently pursuing a board certification through the American College of Medical Practice Executives at MGMA. During her tenure at Allscripts, Paola has provided consulting services to over 250 practices ranging from one-doctor specialty practices to large 1200 physicians IDNs. 2017
Revenue Cycle Company of the Year Frost & Sullivan
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1. Evaluate revenue cycle management workflow processes and identify key opportunities
2. Review key performance indicators and compare the organization against industry benchmarks
3. Identify the best revenue cycle management partner and maintain a successful and profitable relationship
Learning Objectives
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How to Best Perform an Internal Revenue Cycle Assessment?
Initial Discovery
Workflow
Observations
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Initial Discovery – Engage the Management Team
Describe the process end to end. What are the goals and objectives of the process?
What measures are used to manage the process? Weekly, monthly measures? Trends?
How are these measures used by management? Staff meetings? 1:1s? Communicated to the team?
What are the Key Performance Indicators?
What pains does the process cause? What do people want or desire from the process?
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Initial Discovery – Engage the Staff Members
How does the process start?
What event triggers the process to start?
How does the process get from point A to point B?
How do you know when one part is done?
Where do you spend most of your time, and why?
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Initial Discovery – Engage the Staff Members
Where in the process do you repeat work? How often, and why?
What parts of the process do you deem unnecessary, and why?
When pressed for time, what steps in the process do you skip or work around?
What pains does the process cause? What do people want or desire from the process?
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Scheduling
Demographic Accuracy
Scheduling Template Utilization
Insurance Verification
Outstanding Balance Notification
Pre-Visit
Appointment Reminders
Eligibility & Benefit Verification
Prior-Authorization Management
Mobile Check-In & Collections
Front Desk
Demographic Verification
Real Time Eligibility Verification
Insurance and ID Scanning
TOS Collections
Credit Card On File
Front End Workflow Observations
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Coding
Accurate Documentation
Audit & Compliance
Coding Lag
Training & Feedback
Charge Capture
Hospital Services
Satellite Locations
In-Office Services
Charge Reconciliation
Charge Entry
Charge Interfaces
Automated Edits
Claim Scrubbing
Automated Queues
Coding & Charge Posting Workflow Observations
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Insurance & Patient Billing
Timely Submission
Claim Reconciliation
Claim Scrubbing
Automated Queues
Payment Posting
ERA vs Manual
$0.00 EOB Posting
Auto-Adjustments
Underpayments
Refunds
Automated Queues
Proactive vs Reactive
AP Integration
Credit Card Refunds
Billing & Payment Posting Workflow Observations
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Self Pay Follow Up
Process Automation
Credit Card On-File
Automated Monthly Deductions
Collection Agency
Insurance Follow Up
Automated Queues
Timely Follow up
Insurance Expertise
Specialty Expertise
Denial Management
Denial Rate Trending
Denial Reasons
Automated Alerts
Automated Queues
Follow Up & Denial Mgmt. Workflow Observations
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• Practice Productivity (Location, Specialty, Provider, RVU)
• Staff Productivity (Volume & Quality)
• Insurance Productivity (Contract Adherence, Denial Trending, Days in AR, Aging AR)
• Industry Benchmarking (HFMA, Professional Associations, MGMA)
• Actionable Reporting and Alerts
• Access to Dashboards (Location, Specialty, Provider, Insurance)
• Minimal Data Manipulation
Reporting Capabilities Assessment
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Workflow Observation Tips
Watch users in action
Practice your poker face
Make the users feel comfortable
Prompt users to show you what they are explaining
Show them a few tricks to improve their processes
Don’t change daily workflows during this time
Acknowledge their concerns
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How to Measure the Success of Your Revenue Cycle Operations?
Operational Metrics
AR Metrics
Staffing Metrics
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Indicator Calculation Target
Pre-Registration Rate # Patient Encounters / # Scheduled Patients >95%
Insurance Verification Rate # Verified Encounters / # Scheduled Patients >95%
Service Authorization Rate # Authorized Encounters / # Patients Requiring Authorization >95%
Front Desk Denial Rate # Front Desk Denials / # Total Denials (Registration/Eligibility/Authorization) <2%
Appointment Confirmation Rate # Appointments Confirmed/ # Total Appointments >95%
Time of Service Collection Rate TOS Collections / Total Patient Responsibility to Collect>98 % (Office)
>80% (Balance)
Insurance Card Capture Rate # Total Captured Cards / # Total Insured Patients Seen >98%
Operational Metrics
Front Desk
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Coding, Charge Entry and Billing
Operational Metrics
Indicator Calculation Target
Average Day Lag (Charges) # Lag Days / # Total Claims (Coding / Posting / Billing)<24 Hours (Office)
<72 Hours (Off-Site)
Missing Charge Rate # Missing Encounters / # Total Encounters 0%
Clean Claim Ratio # Failed Claims / # Total Submitted Claims >98%
Claims Pending on Edit # Pended Claims / # Total Claims (Held Claims) <1%
Coding Denial Rate # Coding Denials/ # Total Denials <2%
Charge Entry Denial Rate # Charge Entry Denials / # Total Denials <2%
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Payment Entry and Follow Up
Operational Metrics
Indicator Calculation Target
Average Day Lag (Payments) # Lag Days / # Total Paid Claims (Payment Entry) <24 Hours
Payment Entry Error Rate # Payment Entry Errors/ # Total Posted Entries <2%
Timely Account Follow Up(Next Follow Up Date – Initial Follow Up Date) # Days / # Total Worked Outstanding Claims
<30 Days
Timely Denial Management (Submission Date – Posting Date) # Days / # Total Denials <7 Days
Untimely Denial Follow Up Rate # Untimely Denial Follow Up Denials/ # Total Denials <0%
Patient Inquiry Response Rate # Hours to Respond / # Patient Inquiries <24 Hours
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Indicator Calculation Target
Days in A/R Net (Gross) AR / Average Daily Net (Gross) Charges (Revenue) <35 Days
Gross Collection Rate Payments / Charges (Revenue) *Fee Schedule Mark Up
Net Collection Rate Payments - Refunds/ Charges (Revenue) - Adjustments >92%
AR Over 120 Billed AR Over 120 / Total Billed AR <5%
Payer Mix Charges (Revenue) & Payment Distribution Monitor
Overall Denial Rate (1st Pass) # Claims Denied / # Claims Billed <5%
Appeal Efficiency Rate # Claims Paid After Appeal / # Claims Appealed >75%
Bad Debt as a % of Charges Bad Debt / Gross Charges (Revenue) <1.75%
Credit Balance % Total Credit Balances / Total Billed AR <2%
Accounts Receivable Metrics
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REWORK COSTS AN AVERAGE OF $25.00 PER
CLAIM
25% OF DENIALS ARE NEVER RECOVERED
SUCCESS RATES VARY FROM 55% TO 98%
Understanding the Costs of Denials
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Function Sample Production Measures
Appointment SchedulingWith No Financial Clearance 11-18 Appointments HourWith Financial Clearance 7-11 Appointments/HourSurgery Scheduling 3-4 Appointments/Hour
Insurance Verification 15 Visits/Hour
Benefits Verification 13 Visits/Hour
Referrals 8-13 Authorizations/Hour
Financial Clearance 9-11 Verifications/Hour
Check In With Data Verification & Cashiering 11-14/Hour
Check Out With Scheduling & Cashiering 8-12/Hour
Staffing Metrics – Front Office
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Function Sample Production Measures
CodingE/M Coding 15-20/HourProcedure Coding 6-12/Hour
Charge Entry55-75 Service Lines/Hour20 Charge Corrections/Hour
Claims Edits 20 Claims/Hour
Payment Entry150 Manual Lines/Hour20 Electronic-Posted Rejections Resolved/Hour
Credit Balances 10 Credit Balances Resolved/Hour
Self Pay Follow Up 10-13 Accounts Worked/Hour
Correspondence 13-15 Worked Accounts/Hour
Insurance Follow-Up 7-10 Worked Accounts/Hour
Staffing Metrics – Back Office
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Avoid the “Jack of all Trades” model
Clearly set expectations and monitor productivity to increase accountability
Be extra selectively when hiring new staff members (50% salary cost to replace an employee)
Implement a culture of continuous process improvement
Update training materials to reflect process changes
Celebrate all the WINs
Staffing Considerations
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Partnering with a Reputable Revenue Cycle Company
When to Partner with
a Revenue Cycle
Company?
How to Partner with
a Revenue Cycle
Company?
Maintaining a
Successful Partnership
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When to Partner with a Revenue Cycle Company?Can you track whether your providers are coding accurately?
Are you receiving full reimbursement for services?
Do you have access to rejected claim volumes, reasons, and benchmarks?
Do you have analytics that provide helpful insight into payments, A/R, RVUS, and staff productivity?
Are you confident that your current system is prepared to manage increasing self-pay balances as patient responsibility continues to increase?
Are you prepared to manage changing reimbursement models?
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When to Partner with a Revenue Cycle Company?Do you have lots of manual processes to support your operations?
Is your billing department understaffed?
Is it difficult to retain and/or recruit skilled resources?
Is your AR over 90 days out of control?
Are your days in AR over 60 days?
Are you transferring a lot of patient balances over to the collection agency or adjusting them off as bad debt?
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Top 8 Reasons Why Organizations Partner with a Revenue Cycle Management Company
Reduce Disruption from Industry Changes
Reduce Overhead Costs
Value-Added Strategic Partner with Subject Matter Expertise
Enhanced Business Intelligence
Access to State of the Art Technology
Improve Practice Profitability
Ability to Scale at a Faster Pace
Ability to Concentrate on Delivering Healthcare Services
Increase Patient Satisfaction
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Conduct an operational and
financial assessment and identify opportunities
Contact at least 3 Revenue Cycle Management Companies
Evaluate all services offerings - Make sure you are appropriately comparing different
offerings
Align your needs with the services offerings
Complete a return on investment
Obtain references
How to Partner with a Revenue Cycle Company?Pre-Planning Phase
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Proven resultsUtilize the latest and greatest technology
Follow HIPPA compliant processes
Provide actionable analytics
Are experts in your state and specialty
Have a governance structure in place to appropriately manage your account
How to Partner with a Revenue Cycle Company?Selection Phase
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How to Partner with a Revenue Cycle Company?
Make sure you are appropriately comparing different offerings
Outsource services range from 4% to 13% of net collections
Consider documenting turn around expectations (i.e. billing and posting lags)
Keep an eye on the term of the contract – Lock your % of collections
Clearly understand the termination clauses
Negotiation Phase
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Managing the Change
01Setting Expectations
02Managing the Legacy AR
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How to Partner with a Revenue Cycle Company?Implementation Phase
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Assign a Project Sponsor
Hold your Partner Accountable BUT Own Your Project
Start Building the Partnership – This Project Needs to be a Win-Win for ALL
Be Transparent with the Staff – You Will Need Their Support to be Successful
Managing the Change
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Ramping Up - Setting the “ Right” Expectations
0 -30 Days• 80% Legacy
AR
31 – 60 Days• 70 %
Legacy AR
61 to 90 Days• 40 %
Legacy AR
91 to 120 days• 15 %
Legacy AR
Over 120 Days• <1%
Legacy AR
*Considerations:Payer MixResource Availability
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Managing the Legacy Accounts Receivable
Using Current Resources
• Stay Bonuses• Financial
Targets• Outplacement
Services
Using Temps
• Interviews• Training• Current Labor
Pool
Using 3rd
Party
• Ambulatory vs Acute
• Per Employee Fee vs % of Collections
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Building a Successful Partnership
Define and document policies, procedures, work standards, and business rules
Have a clear understanding of the roles and responsibilities between the two parties
Set measurable milestones and deliverables to meet the strategic and operational goals of the organization
Schedule regular check points to ensure all goals are being met
Develop action plans to address challenges
Nurture a transparent partnership to gain win-win results
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Summary of Recommendations
• Complete an operational assessment, benchmarking your organization’s key performance indicators against industry standards
• Identify opportunities for improvement
• Establish, if not already in place, a continuous process improvement team
• Develop an implementation plan and identify additional key performance indicators if needed
• Make sure that all new processes are patient friendly
• Automate and centralize as many processes as possible to lead a reduction in costs and improved efficiencies
• Don’t go at it alone
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Questions?
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About Revenue Cycle Services
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Thank You
Paola Turchi, MSHCA, CHFP, CPC
949.547.8940 | C
[email protected] | www.allscripts.com
Allscripts Revenue Cycle Management Services
2017 Revenue Cycle Company of the Year Frost & Sullivan