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Revenue Management &
Collections
Prepared and Presented by
Linda Hagen and Mae Regalado

Overview
Presentation Outline
1.
2.
3.
4.
5.
6.

Overview
The Patient Flow Process
Revenue Cycle Management
Best Practices in Revenue Management
Fast Facts about Collections
Questions and Answers
Overview
• Revenue Cycle Management is the allinclusive process of creating, submitting,
analyzing, and paying for health care - a
very broad set of administrative services
• Harvard Medical School and Public
Citizen estimated in 2003 that 31% of our
total health care costs result from these
activities
Overview
• The revenue cycle starts when the patient calls your
office for an appointment and your staff captures the
patient's name, phone number, and their insurance
eligibility and coverage information.
• The cycle ends when the balance on their account is
zero.
• The cycle is best supported by effective information
systems
• Electronic billing is a mainstay among third party
payers, managed care, and Medicaid
• The need for electronic billing will only grow
The Patient Flow Process
• It all starts
when the
patient obtains
services from a
healthcare
provider
Revenue Management & Patient
Flow

• Revenue management works hand in hand with the
patient flow process (from scheduling and registration
through treatment, discharge and collection)
• The majority of revenue management issues start
early when the provider is collecting and verifying
patient information needed to ensure submission of a
clean claim and receipt of full payment.
• Rather than address problems retrospectively,
providers are urged to focus their efforts on front-end
processes that help ensure the problems do not arise
in the first place.
The Revenue Cycle
Best Practices Appointment Scheduling
• Schedule the appointment within time
desired by patient
• Reduce no-shows and inform patient
to bring insurance card and copayment
• Language Counts
Best Practices Appointment Scheduling
Improve Communication With Patients
Situation

What NOT To Say

What To Say

Confirming an
appointment:

Let me know if you can’t make it.

We’re expecting you. We’ve
dedicated this appointment to you.
Rationale: Strong words reinforce
the patient’s obligation.

Message: We know you might
not make it, and that’s okay.

Booking an
appointment:

I’m squeezing you in.
Message: You’ll never be
missed if you don’t show up, and
you can expect to wait when you
get here.

I have an opening for you at 2:00
pm
Rationale: We have time for you
and want to see you.

Call the
no-show
appointment:

I’m calling to reschedule the
appointment you missed.
Message: Missed appointments
are not your responsibility.

We’re concerned that you missed
an appointment. It’s important that
you come in.
Rationale: Emphatic, but
empathetic.
Appointment Scheduling Process
•
•
•
•
•

Pre-registration
Begin the revenue cycle
Eligibility verification of insurance
Authorization
Financial obligation policy
Best PracticesPatient Registration
• Ensure authorization is received
• Conduct eligibility verification
• Gather all demographics including
any secondary insurance
• Initial review of financial requirements
• Co-pay collection for all appropriate
patients
Best PracticesPatient Assessment/Encounter
• Reasonable and timely access to
care and services
• Complete clinical services
• Services are informative and effective
• Thorough and accurate clinical
documentation for correct billing
Best PracticesDocumentation & Coding
• Provider documents services
• Services coded:
– CPT codes
– HCPCS codes
– Modifiers
– ICD-9

• Stay on top of Coding Changes
Best PracticesDocumentation & Coding
• Documentation complete and signed
by provider
• Codes accurately reflect patient
service(s)
• Coding reviewed to ensure it reflects
documentation
Best PracticesCharge Processing
• Data Entry and Coders enter data into Billing
System
• Fee entered automatically or manually
• Billing Manager or automated claim software
scrubs entries for correctness
• Problems sent to department work file for
processing
• Reconciliation performed to ensure all entries
received and entered into practice management
billing system
Best PracticesCharge Processing
• Accuracy of service and charge
• Appropriate edits in place to scrub
data
• Charges entered timely for prompt
payment
Best PracticesClaim Submission
• Claims edited to ensure completeness and
correctness
• Accurate claims sent daily to health plans
• Claims flow electronic and paper
• Increase % of electronic claims
• Keep average cost per claim better than
benchmark
• Get statements out to patients for self-pay
balances every week within the current billing
cycle (30 days)
Best PracticesPayment Processing
• Electronically or manually post remittances from
payers and patients
– Co-pays and plan payments
– Denials or rejections
– Adjustments

• Reconciliation of charges, payments and
adjustments
• All payments and denials processed within 24
hours of receipt
• Process all refunds in a timely manner
Best PracticesResubmission, Secondary Billing and
Appeals
• Typical Issues and Problems:
–
–
–
–
–

Invalid registration
Medical documentation required
Correct coding and/or charge corrections
Missing referral/pre-authorizations
Secondary claims and patient statement produced

• Assess denial patterns and trends
• Quantify the financial impact of denials
Best PracticesResubmission, Secondary Billing and
Appeals
• All invoices requiring an appeal processed are
completed within one week of receiving
rejection
• Process all responses from clinical departments
within one day of receiving information
• All secondary claims submitted within a week of
receiving primary payment
Best PracticesA/R Follow-up
• Process all denials within a one week of
receipt of reject.
• Follow-up on all outstanding requests with
clinical departments within one week of
initial request.
• Follow-up on all “no response” claim
invoices within 45 days of claim
submission.
Collections
1. At time of service
2. Following adjudication of claims
3. After repeated attempts to collect
Pre-Service Cash Collections
• Accept the philosophy and the fact that it’s ok to collect
cash from your patients. The economically-distressed can
be put on a sliding scale. Collect something.
• Clearly post a message in your lobby and elsewhere setting
the expectation that co-pay is due at the time of service,
prior to seeing the clinician. Most commercial contracts
require that you collect co-insurance.
• Train staff in collecting cash. Assertive language is key.
• Establish a cash management policy and procedure with
checks and balances
• Establish target performance indicators
• Measure progress and performance
• Hold everyone accountable including clinicians who can be
instrumental in this process
Post-Claims Cash Collections
• Clearly post a message in your lobby and elsewhere setting
the expectation that you will make every effort to collect
payment from third-parties but that the client is ultimately
responsible for payment
• Review Remittance Advice and denials with patient, helping
them understand how it is that the third-party will not be
paying and how it is that they are now responsible
• Consider sliding scales and payment plans
• Hold everyone accountable including clinicians who can be
instrumental in this process
• Remember that failure to collect co-insurance is often
deemed breach of contract with payers unless you are an
out-of-network provider
Facts About Collections
when all else fails
Tips about using collection agencies:
• Only 5 percent of accounts over 90 days past
due will ever pay voluntarily
• It is estimated that accounts that are:
- 90 days past due are 90 percent collectible
- 180 days past due are 67 percent collectible
- 1 year old are 40 percent collectible
Facts About Collections
Why patient collections matter:
• Rapid growth in consumer-directed health plans mean
you will be faced with the need to collect on
deductibles to a far greater extent
• Annual growth in bad debt write-offs due to consumerdirected plans means you could be providing more
free services than ever
• Health Care Reform will eventually shift 60% or more
of the current Substance Abuse Treatment Block
Grant recipients into Health Insurance Exchanges and
Medicaid managed care plans where collection of coinsurance is a fact of life that drops straight to your
bottom-line
Thank You! Questions?

888-898-3280
www.ahpnet.com

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BEST PRACTICES IN REVENUE MANAGEMENT

  • 1. Revenue Management & Collections Prepared and Presented by Linda Hagen and Mae Regalado Overview
  • 2. Presentation Outline 1. 2. 3. 4. 5. 6. Overview The Patient Flow Process Revenue Cycle Management Best Practices in Revenue Management Fast Facts about Collections Questions and Answers
  • 3. Overview • Revenue Cycle Management is the allinclusive process of creating, submitting, analyzing, and paying for health care - a very broad set of administrative services • Harvard Medical School and Public Citizen estimated in 2003 that 31% of our total health care costs result from these activities
  • 4. Overview • The revenue cycle starts when the patient calls your office for an appointment and your staff captures the patient's name, phone number, and their insurance eligibility and coverage information. • The cycle ends when the balance on their account is zero. • The cycle is best supported by effective information systems • Electronic billing is a mainstay among third party payers, managed care, and Medicaid • The need for electronic billing will only grow
  • 5. The Patient Flow Process • It all starts when the patient obtains services from a healthcare provider
  • 6. Revenue Management & Patient Flow • Revenue management works hand in hand with the patient flow process (from scheduling and registration through treatment, discharge and collection) • The majority of revenue management issues start early when the provider is collecting and verifying patient information needed to ensure submission of a clean claim and receipt of full payment. • Rather than address problems retrospectively, providers are urged to focus their efforts on front-end processes that help ensure the problems do not arise in the first place.
  • 8. Best Practices Appointment Scheduling • Schedule the appointment within time desired by patient • Reduce no-shows and inform patient to bring insurance card and copayment • Language Counts
  • 9. Best Practices Appointment Scheduling Improve Communication With Patients Situation What NOT To Say What To Say Confirming an appointment: Let me know if you can’t make it. We’re expecting you. We’ve dedicated this appointment to you. Rationale: Strong words reinforce the patient’s obligation. Message: We know you might not make it, and that’s okay. Booking an appointment: I’m squeezing you in. Message: You’ll never be missed if you don’t show up, and you can expect to wait when you get here. I have an opening for you at 2:00 pm Rationale: We have time for you and want to see you. Call the no-show appointment: I’m calling to reschedule the appointment you missed. Message: Missed appointments are not your responsibility. We’re concerned that you missed an appointment. It’s important that you come in. Rationale: Emphatic, but empathetic.
  • 10. Appointment Scheduling Process • • • • • Pre-registration Begin the revenue cycle Eligibility verification of insurance Authorization Financial obligation policy
  • 11. Best PracticesPatient Registration • Ensure authorization is received • Conduct eligibility verification • Gather all demographics including any secondary insurance • Initial review of financial requirements • Co-pay collection for all appropriate patients
  • 12. Best PracticesPatient Assessment/Encounter • Reasonable and timely access to care and services • Complete clinical services • Services are informative and effective • Thorough and accurate clinical documentation for correct billing
  • 13. Best PracticesDocumentation & Coding • Provider documents services • Services coded: – CPT codes – HCPCS codes – Modifiers – ICD-9 • Stay on top of Coding Changes
  • 14. Best PracticesDocumentation & Coding • Documentation complete and signed by provider • Codes accurately reflect patient service(s) • Coding reviewed to ensure it reflects documentation
  • 15. Best PracticesCharge Processing • Data Entry and Coders enter data into Billing System • Fee entered automatically or manually • Billing Manager or automated claim software scrubs entries for correctness • Problems sent to department work file for processing • Reconciliation performed to ensure all entries received and entered into practice management billing system
  • 16. Best PracticesCharge Processing • Accuracy of service and charge • Appropriate edits in place to scrub data • Charges entered timely for prompt payment
  • 17. Best PracticesClaim Submission • Claims edited to ensure completeness and correctness • Accurate claims sent daily to health plans • Claims flow electronic and paper • Increase % of electronic claims • Keep average cost per claim better than benchmark • Get statements out to patients for self-pay balances every week within the current billing cycle (30 days)
  • 18. Best PracticesPayment Processing • Electronically or manually post remittances from payers and patients – Co-pays and plan payments – Denials or rejections – Adjustments • Reconciliation of charges, payments and adjustments • All payments and denials processed within 24 hours of receipt • Process all refunds in a timely manner
  • 19. Best PracticesResubmission, Secondary Billing and Appeals • Typical Issues and Problems: – – – – – Invalid registration Medical documentation required Correct coding and/or charge corrections Missing referral/pre-authorizations Secondary claims and patient statement produced • Assess denial patterns and trends • Quantify the financial impact of denials
  • 20. Best PracticesResubmission, Secondary Billing and Appeals • All invoices requiring an appeal processed are completed within one week of receiving rejection • Process all responses from clinical departments within one day of receiving information • All secondary claims submitted within a week of receiving primary payment
  • 21. Best PracticesA/R Follow-up • Process all denials within a one week of receipt of reject. • Follow-up on all outstanding requests with clinical departments within one week of initial request. • Follow-up on all “no response” claim invoices within 45 days of claim submission.
  • 22. Collections 1. At time of service 2. Following adjudication of claims 3. After repeated attempts to collect
  • 23. Pre-Service Cash Collections • Accept the philosophy and the fact that it’s ok to collect cash from your patients. The economically-distressed can be put on a sliding scale. Collect something. • Clearly post a message in your lobby and elsewhere setting the expectation that co-pay is due at the time of service, prior to seeing the clinician. Most commercial contracts require that you collect co-insurance. • Train staff in collecting cash. Assertive language is key. • Establish a cash management policy and procedure with checks and balances • Establish target performance indicators • Measure progress and performance • Hold everyone accountable including clinicians who can be instrumental in this process
  • 24. Post-Claims Cash Collections • Clearly post a message in your lobby and elsewhere setting the expectation that you will make every effort to collect payment from third-parties but that the client is ultimately responsible for payment • Review Remittance Advice and denials with patient, helping them understand how it is that the third-party will not be paying and how it is that they are now responsible • Consider sliding scales and payment plans • Hold everyone accountable including clinicians who can be instrumental in this process • Remember that failure to collect co-insurance is often deemed breach of contract with payers unless you are an out-of-network provider
  • 25. Facts About Collections when all else fails Tips about using collection agencies: • Only 5 percent of accounts over 90 days past due will ever pay voluntarily • It is estimated that accounts that are: - 90 days past due are 90 percent collectible - 180 days past due are 67 percent collectible - 1 year old are 40 percent collectible
  • 26. Facts About Collections Why patient collections matter: • Rapid growth in consumer-directed health plans mean you will be faced with the need to collect on deductibles to a far greater extent • Annual growth in bad debt write-offs due to consumerdirected plans means you could be providing more free services than ever • Health Care Reform will eventually shift 60% or more of the current Substance Abuse Treatment Block Grant recipients into Health Insurance Exchanges and Medicaid managed care plans where collection of coinsurance is a fact of life that drops straight to your bottom-line

Editor's Notes

  1. In the past, healthcare centers/hospitals tended to focus their efforts at the end of this process — on billing and collection.
  2. The Revenue Cycle begins at the making of an appointment goes until the encounter is zero. At each point of contact with patient or an encounter a breakdown could happen.