5 Secrets Hiding in Your Hospital’s Revenue Cycle Metrics
Hospitals have a million things on their plate. They are the makers or breakers of their patients’ health. However, amid all their core responsibilities, revenue cycle can often get disrupted. It is very important for healthcare businesses to define key performance metrics to ensure they meet their financial objectives, year on year. Allowing your revenue cycle systems to go haywire is the quickest way to upset your cash balance.
But defining KPIs alone does not keep your revenues secure. Believe it or not, despite the effectiveness of monitoring KPIs, there are some metrics that can affect your financial performance by hiding the snags. Sometimes some issues may not be obvious and get overlooked in the intricate process of revenue cycle management. However, there are certain indicators that, if looked closely, can reveal valuable information about how to reduce cost,
expedite payment process and increase overall revenue.
Let’s have a close look at those secret ingredients that are hiding in your revenue cycle metrics-
1. Clean Claims Rate:
Did you know that below average clean claims rate can indicate more serious fundamental problems? Not getting paid within the first submission is a sign of poor filing practice and a sloppy claims process. This issue can be resolved by establishing a dedicated team that can investigate the reasons for denial, address those issues and correct them to prevent the claims from being delayed. At the same time, your employees need to be trained on new billing changes and latest medical processes to ensure that the protocols are being followed every single time. As of now, hospitals get 75-85% clean claims on an average, which is not bad, but still below model number. The goal should be to reach 90% claims rate to remain profitable.
Since healthcare is a highly personalized service, it is hard to keep this patient satisfaction survey, as mandated by Centers for Medicare and Medicaid services, objective. The studies reveal that most patients often complain about the quality of customer service, rather than clinical care itself. If you look deeply into study analysis, it is easy to tell that improving patient experience alone can contribute significantly to financial success. You can start by training your front office staff, improve bedside services, follow tighter scheduling and billing processes, among other things.
Sometimes there are accounts where the billing is on hold for some reason. Needless to say, for the payments to come in, bills must go out! A defect in this process will naturally affect the cash flow of your business. Don’t overlook DNFB as pesky backlogs. They may be signifying a more serious problem. High DFNB rates indicate inefficiency in the system. The biggest reason for human errors in billing can be attributed to medical records exchanging multiple hands. It is important to design a process that reduces human intervention by creating records electronically. They should also seamlessly transition from one function to another without requiring human involvement. The only way to keep billing process flawless is by allowing unbroken movement of patient data across all platforms.
4. Net Collection Percentage:
This performance indicator exposes the amount of revenue that has been lost to bills that remain uncollected due to variety of reasons. It could be anything from underpaid claims to payment processing error, bad debt, inaccurate filing, etc. If your Net Collection Percentage is dangerously low, then it may suggest a need for upgrading your technology and improving your tools to make the billing practice more efficient. At the same time, your employees should have the training and understanding of your processes, so that they can counsel the patients about their financial responsibility.
5. Account Receivables Due more than 90 Days:
Claims that are over 90 days is bad for the cash flow. If you have a high number of the claims crossing this bracket, it may suggest that your claim submission is not happening within stipulated time, the submitted claims are inaccurate or some information is missing from the documentation. Hence it is recommended to start working on the account receivables after 30 days, instead of waiting for 90 days. It would be a good idea to have a follow-up system that will automatically highlight the accounts that have not been paid for 30 days. This practice will help reduce the payment delays.
Make sure that you keep an eye on the secrete indicators that indicate the bigger issues in your revenue cycle. In case you are having any issues with this regards, don’t hesitate to contact us. We are a premium offshore revenue cycle management company that has been in the industry for over a decade and has perfected the art of using these indicators to flag issues and revamp your revenue cycle.