Jessica Nantz, president and founder of Outpatient Healthcare Strategies, discusses 12 strategies to improve reimbursement processes in your surgery center.
1. Monitor your revenue cycle processes. A profitable surgery center depends in part on a functional revenue cycle, Ms. Nantz says. Since the revenue cycle has many moving parts, every part has to be working properly in order to achieve maximum reimbursement. "Once the case is actually completed and the op note is dictated, the revenue cycle kicks in," she says. "It goes from transcription to coding to charge entry to billing to posting, and you need to monitor every one of those processes."
She says monitoring revenue cycle processes includes the following tasks:
• Ensure transcription is completed in 24 hours. Look at your transcription processes to determine whether you have a "problem physician" who isn't turning in his or her dictation on time. If you have a consistently late physician, sit down and explain the importance of timely transcription for timely payment.
• Ensure coding is completed in 48 hours. "Coding is the first step to bringing the cash in," Ms. Nantz says. Audit your coders on a regular basis to make sure coding is completed within 48 hours of the procedure. You should also conduct semi-regular aduits to ensure coding accuracy, which can be performed by an outside consultant. Ms. Nantz says you should also have a backup plan if your regular coder is out, which may mean cross-training other members of the business office team to understand coding basics.
• Ensure billing is sent in 72 hours. Billing should be sent out within 72 hours of the procedure to ensure timely reimbursement, Ms. Nantz says.
• Receive updates on OTC and A/R collections. You should have a good idea of your month-to-date OTC and A/R collections, Ms. Nantz says. You should also understand which areas your ASC has the most trouble collecting from. Are you struggling to collect from patients because your collector only calls in the morning, when patients are at work? Are you receiving denials from payors because of coding issues? Knowing your problem areas will help you target specific employees and processes for improvement.
2. Ensure collection goals are met. Make sure your staff members know your collection goals on a daily basis, Ms. Nantz says. For example, you might set an over-the-counter collection goal of $6,000. This means that you have totaled each patient's expected co-pay and co-insurance and added the totals together for the day. Once receipts come in at the end of the day, you can compare the total collected to your collection goal. "If you set a goal of $6,000 and collected $3,000, why were you at 50 percent?" Ms. Nantz says. "What happened, and what issues are you having?" She says it's important to make sure goals are met for both over-the-counter collections and A/R.
• Review A/R accounts with your business manager. On a regular basis, review you’re A/R accounts with your business manager and determine which "buckets" are doing well and which have problems. For example, you may have a lot of claims in your "over 120 days" bucket, meaning you're still waiting for payment 120 days later. If those claims are from payors that take a long time to reimburse you — such as workers' comp — this may not be a problem.
• Discuss reasons for claim denials. Talk to your business manager about the reason for claim denials, Ms. Nantz says. She recommends performing a quality improvement study around your percentage of claim denials. Once you understand how many claims are denied, you can dig deeper to determine the cause. "Is there a certain payor that always returns claims for a certain reason? Is there an employee who's transposing incorrect data? Is there something that's not attached?" Ms. Nantz says. She says if you outsource any of your revenue cycle processes, you should still be having this conversation with your revenue cycle company.
3. Track your implant reimbursement. Implant reimbursement is essential to profiting from your cases — especially orthopedic cases, which carry high implant costs. Ms. Nantz recommends tracking implant reimbursement to determine how much your payors are reimbursing you for your implants. "Some people have implants at cost, and some people have them at cost plus — the point is, how do you know what implant revenue is coming back if you're not tracking that?" she says.
She says you should keep a spreadsheet that details how payors pay for implants, because the methodology will probably differ from payor to payor. For example, some payors pay the ASC per implant, whereas others just lump the payment into the total reimbursement for the case. You need to analyze your implant reimbursement separately from total case reimbursement to make sure you're receiving enough money for your high-dollar items.
4. Monitor your payor contracts. Every administrator should understand reimbursement for their top CPT codes by specialty and payor, in order to predict the center's profitability, Ms. Nantz says.
• Review payor mix monthly by contract and by physician. Look at the rates you're receiving from your payors on a monthly basis, Ms. Nantz says. "You should look at the rates you're being paid by contract and by physician," she says. "That predicts your net revenue — in a month, there's a huge difference in net revenue depending on whether you're reimbursed at $400 or $600 for GI cases, or $2,000 or $3,000 for shoulder cases."
• Review top 12 payor contracts (one per month). Review one payor contract a month to determine whether the payor is reimbursing your center in a timely fashion, and whether you could stand to re-negotiate the contract for a payment increase. For example, if the cost of your supplies has gone up in the past year, you will see upon reviewing the contract that your payor no longer reimburses an adequate amount to cover your costs.
Related Articles on Coding, Billing and Collections:
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New Jersey ASC Association Opposes Bill to Expand State Anti-Fraud Legislation
1. Monitor your revenue cycle processes. A profitable surgery center depends in part on a functional revenue cycle, Ms. Nantz says. Since the revenue cycle has many moving parts, every part has to be working properly in order to achieve maximum reimbursement. "Once the case is actually completed and the op note is dictated, the revenue cycle kicks in," she says. "It goes from transcription to coding to charge entry to billing to posting, and you need to monitor every one of those processes."
She says monitoring revenue cycle processes includes the following tasks:
• Ensure transcription is completed in 24 hours. Look at your transcription processes to determine whether you have a "problem physician" who isn't turning in his or her dictation on time. If you have a consistently late physician, sit down and explain the importance of timely transcription for timely payment.
• Ensure coding is completed in 48 hours. "Coding is the first step to bringing the cash in," Ms. Nantz says. Audit your coders on a regular basis to make sure coding is completed within 48 hours of the procedure. You should also conduct semi-regular aduits to ensure coding accuracy, which can be performed by an outside consultant. Ms. Nantz says you should also have a backup plan if your regular coder is out, which may mean cross-training other members of the business office team to understand coding basics.
• Ensure billing is sent in 72 hours. Billing should be sent out within 72 hours of the procedure to ensure timely reimbursement, Ms. Nantz says.
• Receive updates on OTC and A/R collections. You should have a good idea of your month-to-date OTC and A/R collections, Ms. Nantz says. You should also understand which areas your ASC has the most trouble collecting from. Are you struggling to collect from patients because your collector only calls in the morning, when patients are at work? Are you receiving denials from payors because of coding issues? Knowing your problem areas will help you target specific employees and processes for improvement.
2. Ensure collection goals are met. Make sure your staff members know your collection goals on a daily basis, Ms. Nantz says. For example, you might set an over-the-counter collection goal of $6,000. This means that you have totaled each patient's expected co-pay and co-insurance and added the totals together for the day. Once receipts come in at the end of the day, you can compare the total collected to your collection goal. "If you set a goal of $6,000 and collected $3,000, why were you at 50 percent?" Ms. Nantz says. "What happened, and what issues are you having?" She says it's important to make sure goals are met for both over-the-counter collections and A/R.
• Review A/R accounts with your business manager. On a regular basis, review you’re A/R accounts with your business manager and determine which "buckets" are doing well and which have problems. For example, you may have a lot of claims in your "over 120 days" bucket, meaning you're still waiting for payment 120 days later. If those claims are from payors that take a long time to reimburse you — such as workers' comp — this may not be a problem.
• Discuss reasons for claim denials. Talk to your business manager about the reason for claim denials, Ms. Nantz says. She recommends performing a quality improvement study around your percentage of claim denials. Once you understand how many claims are denied, you can dig deeper to determine the cause. "Is there a certain payor that always returns claims for a certain reason? Is there an employee who's transposing incorrect data? Is there something that's not attached?" Ms. Nantz says. She says if you outsource any of your revenue cycle processes, you should still be having this conversation with your revenue cycle company.
3. Track your implant reimbursement. Implant reimbursement is essential to profiting from your cases — especially orthopedic cases, which carry high implant costs. Ms. Nantz recommends tracking implant reimbursement to determine how much your payors are reimbursing you for your implants. "Some people have implants at cost, and some people have them at cost plus — the point is, how do you know what implant revenue is coming back if you're not tracking that?" she says.
She says you should keep a spreadsheet that details how payors pay for implants, because the methodology will probably differ from payor to payor. For example, some payors pay the ASC per implant, whereas others just lump the payment into the total reimbursement for the case. You need to analyze your implant reimbursement separately from total case reimbursement to make sure you're receiving enough money for your high-dollar items.
4. Monitor your payor contracts. Every administrator should understand reimbursement for their top CPT codes by specialty and payor, in order to predict the center's profitability, Ms. Nantz says.
• Review payor mix monthly by contract and by physician. Look at the rates you're receiving from your payors on a monthly basis, Ms. Nantz says. "You should look at the rates you're being paid by contract and by physician," she says. "That predicts your net revenue — in a month, there's a huge difference in net revenue depending on whether you're reimbursed at $400 or $600 for GI cases, or $2,000 or $3,000 for shoulder cases."
• Review top 12 payor contracts (one per month). Review one payor contract a month to determine whether the payor is reimbursing your center in a timely fashion, and whether you could stand to re-negotiate the contract for a payment increase. For example, if the cost of your supplies has gone up in the past year, you will see upon reviewing the contract that your payor no longer reimburses an adequate amount to cover your costs.
Related Articles on Coding, Billing and Collections:
Medicare Physicians Still Code Manually, Despite Availability of EHR
5 Core Concepts for a Great Billing & Collections Business
New Jersey ASC Association Opposes Bill to Expand State Anti-Fraud Legislation