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Revolutionizing Revenue: Best Practices for Assertive Accounts Receivable Follow-Up

By Debra Stall

June 3, 2024

A streamlined revenue cycle that efficiently manages accounts receivable (A/R) not only ensures financial health but also enhances patient satisfaction. In our recent webinar, Revolutionizing Revenue: Best Practices for Assertive Accounts Receivable Follow-Up we partnered with Health Connect America to provide a deep dive into best practices for healthcare organizations to optimize their A/R processes and, by extension, transform their revenue strategies.

Proactive Denial Prevention and Management

Understanding the common reasons for denials and implementing a proactive approach can significantly reduce revenue leakage, minimizing losses and increasing revenue. This involves a comprehensive analysis of denial patterns, identifying the root causes to address them at the source, and implementing quality control measures.

Key areas of focus for preventing patient access-related denials include:

  • Integrity of pre-registration and registration data. Reducing missing information, incorrect member ID, provider or payer information
  • Orders, authorizations, and pre-certification. These denials can be reduced through order intake and securing authorization prior to the procedure.
  • Eligibility verification. Ensure all scheduled patients’ insurance is verified before the visit and non-scheduled appointments are verified prior to discharge.
  • Benefit plan coverage. Ensure the visit or procedure is verified at the time of insurance verification and confirm the patient’s benefits are not exhausted.
  • ABN/Medical Necessity. Ensure proper patient signatures are obtained and information is scanned at the patient account level.

An effective denial prevention and management program is multifaceted and should include establishing a governance program led by senior executive leadership and involving collaboration among key stakeholders from various departments including patient access, health information management, and billing. By defining clear roles and responsibilities within a denial prevention program, healthcare organizations can implement a comprehensive approach that ensures accountability and commitment across all levels, fostering a culture of continuous improvement and significantly reducing the likelihood of denied claims.

Tracking Metrics for Continuous Improvement

By closely monitoring and evaluating data and metrics, healthcare organizations can identify trends and patterns in revenue cycle performance to make informed decisions for ongoing improvement, ensure a more efficient resolution process, and enhance overall effectiveness. Analyzing key performance indicators (KPI) and data for root causes enables organizations to develop strategic solutions that effectively address issues at their source and prevent future issues.

Denial Metrics KPIs
Formulas
Initial denial rate
(as a % of volume and $'s)
  • Total initial denial claims/total claims submitted (volume)
  • Total initial denial claims gross charges/total claims submitted gross charges (dollars)
Primary denial rate Total number of zero remits posted in past 4 weeks/total number of remits for primary payers only in past 4 weeks*
Denial write-offs as a percent of net patient revenue Net $'s written off as denials/Average Monthly net patient revenue
Time from initial denial to appeal Count the number of days from date of initial denial remittance until appeal submission date
Time from initial denial to claim resolution Count the number of days from date of initial denial remittance until claim resolution
(zero balance with or without payment)
Percentage of initial denials overturned Initial denials overturned and paid/total initial denial dollars paid and adjusted
(gross charges)

*payments and zero paid, excluding duplicates (Source: HFMA Education)

Accounts Receivable Tips

  • Track the number and dollars for specific third-party payers, how late they are paying, and which payers are accurately reimbursing your organization.
  • Sort A/R aging – large to small balances, to provide quick analysis of unworked accounts.
  • Identify trends where outstanding balance is equal to health plan’s co-pay amounts – identifies lack of pre-service or time of service collection of copays.
  • Segment unworked vs. worked/paid accounts to accelerate cash.
  • Specialize workflow by payer.
  • Identify bulk trends to resolve large groups of accounts or appeals.
  • Measure "accounts resolved" instead of “accounts touched,” and establish resolution criteria in your workflow system.
  • Don’t work accounts one by one with no strategy.

Achieving Your Accounts Receivable Goals

Creating a culture of collaboration between internal teams and external vendors who are an extension of the team can foster a more cohesive approach to achieving A/R objectives. This not only improves communication and collective problem-solving but also leverages the strengths of all parties involved, leading to improved outcomes and a more streamlined A/R process.

Leveraging Workflow Methodology with Segmentation and Automation

Segmentation of A/R utilizing data ingestion is critical to an effective workflow. Data to evaluate and segment includes:

  • 837 claims
  • 835 remittances/denials
  • 277 claim status
  • Electronic Health Record (EHR) charges and adjustments
  • Financial class

With this model, staff work the ending account inventory that need resolution. Leveraging technology in the segmentation process and automating certain aspects can significantly increase efficiency and accuracy while reducing the time and resources spent on manual follow-ups. This technology-driven approach allows healthcare organizations to focus strategically on areas that require human expertise and intervention.

Revolutionizing revenue through assertive accounts receivable management is a comprehensive process requiring prevention strategies, strong leadership, collaborative partnerships, and data-driven decision-making. By focusing on denial prevention, embracing collaboration, and implementing strategic action plans, healthcare organizations can optimize their revenue cycles and achieve their financial goals.

For more insights, check out the webinar, Revolutionizing Revenue: Best Practices for Assertive Accounts Receivable Follow-Up for strategies that can transform the way healthcare organizations handle their revenue processes to improve financial stability and increase patient satisfaction.

Debra-Stall

Debra Stall, CRCR

Author

As Senior VP of A/R Service Line at AGS Health, Debra oversees strategic growth initiatives for the company’s Accounts Receivable Services division. Throughout her 30+ year career, she has helped numerous companies drive operational excellence through global outsourcing, strategic planning, and process improvements. Debra’s extensive experience in healthcare management has delivered transformational results for leading healthcare organizations, resulting in significant financial growth with best-in-class operational efficiency.

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