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5 ways to improve your revenue cycle and limit denials

Sep 22, 2020

Hospitals are rethinking their revenue cycle management.

From patient access, to accuracy of clinical documentation and coding, to proper reimbursement, hospitals understand that nothing represented on the UB-04 claim form is generated in the business office. They know it all emanates along the continuum prior to bill creation.

The impetus for change is often an increase in bad debt and/or AR days. CEOs are focused on trying to capture every dollar for services rendered. However, their challenge is to ensure there is positive revenue and quality outcomes with charge integrity and HIM activities.

Reimbursement challenges threaten the cash flow of many healthcare organizations as they deal with denials. Payers are increasingly using pre-payment review vendors, who will challenge single-line items to prevent paying.

So, what can your healthcare organization do to improve your revenue cycle and help prevent denials? We’ve put together five tips:

1. Put together a revenue cycle committee

Creating a revenue cycle committee can help your organization better think about your revenue cycle as a continuum. The committee’s main function should be to identify the places along that continuum where things are going wrong and then determine how to correct course. Ultimately, you want to become a learning organization that can identify and solve gaps in your revenue cycle and continually improve.

For example, by drilling down into the processes along the continuum, your revenue cycle committee may find that patient eligibility is being checked the day of service instead of during scheduling, and that’s causing a lot of denials downstream. You can then enact a change in process to check eligibility during scheduling.

2. Expand your revenue cycle committee’s membership

Many healthcare organizations that already have revenue cycle committees have made the mistake of not expanding membership to clinical personnel. When you expand membership to more people involved along the full revenue cycle continuum, you find out more and more why denials occur. You discover people are making mistakes entering patient info, putting the wrong insurance into the system, selecting the wrong payer, entering charges incorrectly and not providing sufficient documentation.

By having case management/utilization review nurses on your committee, they can look at denials for level of care, identify what’s gone wrong and then change their processes or help physicians change their processes to prevent these types of denials.

They can also be trained on helping write appeals to payers. Your business office is very effective at appealing the technical details, but when it comes to things like level of care, they’re a little more out of their depth. Nurses can become a big asset in this area.

3. Perform a revenue cycle claims tracing analysis

Getting a mid-cycle view of your revenue cycle can help mitigate denials, which is why we recommend performing a revenue cycle claims tracing analysis.

By using registration information, claims data, clinical documentation, EOB/remittance advice information and patient account data, you can trace from the initial patient contact through complete reconciliation of the patient’s account. You can then gain information about lag times, missed charges/codes, documentation issues or deficiencies, revenue code/CPT/HCPCS code mismatch, chargemaster and/or pricing errors, reimbursement issues, and efficiency of the billing and collections process.

When we perform revenue cycle claims tracing analyses for our clients, we often find things like

  • Clinical documentation was generic/copy-pasted, and medical necessity for the service was unclear
  • Charges were missed, including for high-cost items
  • Diagnosis coding did not accurately portray the documented severity of the problem
  • Unpaid claims were simply being refiled monthly
  • Reimbursement was 100% of the fee for common CPT codes, suggesting lower-than-typical fees

As you can see, the analysis can prove pretty valuable in identifying changes to make.

4. Streamline point of service (POS) collection

We already touched on some of the front-end changes you can make to help mitigate denials and rework on the backend. Things like checking eligibility during scheduling, identifying the right payer and entering the correct insurance information can all help reduce rework. Changing and streamlining processes — and implementing training on the new processes — can help reduce mistakes made.

We also recommend you streamline your POS collection. Get copays prior to the service being delivered, or collect the payment before the patient leaves. This can do quite a lot in helping improve your revenue cycle.

5. Set goals and monitor KPIs

When we perform revenue cycle assessments, we always ask billers, collectors, cash posters and other back-office personnel whether they have productivity goals.

The fact is, employees who have set goals are more motivated to achieve those goals. And it also helps for them to know how much revenue they are expected to bring in. Without set expectations, you can have billers at wildly different levels of productivity. One may be dropping 200 claims a day, while the other is dropping 30.

Another big benefit is keeping financials up to date. If your cash posters are a week behind in posting, you can’t close your month-end, and you can’t get financial data to the people who rely on it to make business decisions. Creating goals and tracking progress can help you make decisions on whether you’re properly staffed and whether processes need to be changed or streamlined to help your cash posters stay up to date.

Wipfli can help with your revenue cycle management

Whether you could benefit from advice in putting together a revenue cycle committee, having an experienced third-party perform a revenue cycle claims tracing analysis, or implementing revenue cycle best practices, Wipfli can help. Click here to learn more about our revenue cycle services, or continue reading on:

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Author(s)

Mary Lopez, RN, MSN
Director
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