Professional medical billing services are becoming more proficient at gathering a lot of data as healthcare professionals. But how can that data be used with the right benchmarks, metrics, and best practices to improve Revenue Cycle Management (RCM). This blog will discuss proven methods to keep your AR department on the right track. It includes data management, managing aged accounts, and reducing bad debt.
Medical Billing Services
Data Analytics Drives Decisions
Medical practices are asking their staff, including accounting and billing personnel, to work remotely with mixed results. Although AR is not a new problem for doctors and other organizations alike, the COVID-19 pandemic highlighted the flaws in the system.
Providers have greater access to advanced data than ever before in order to make administrative and medical decisions. The best data can be meaningless without context references. You can use benchmarks to help you determine the financial health of your company. This will allow your organization to:
- Prepare for possible disruptions and contingencies, as was the case with the pandemic.
- Make better medical and administrative decisions by leveraging the data available
- Prioritize areas that offer maximum collections and minimize revenue loss
- Five Key Metrics to Consider when Assessing the Financial Health Of A Medical Practice
These proven tips can reduce AR pileups, increase slow revenues, and boost your RCM by complete medical billing services.
Days Discharged that Haven’t Been billed (DNFB).
“Discharged not Final Billed” is a metric that helps to identify problems in the receivables cycle. Mismanagement of DNFB could lead to an increase in AR and disruptions to cash flow. Most practices aim to keep DNFB within best practice guidelines, which is between 3 and 5 days. If it is occurring for more than 5 days per week, this could be a sign that your system has issues, such as billing and coding.
- The number of net days in AR is probably the most important indicator of an organization’s financial well-being. Monitoring the average time it takes to collect payments due to rendered services should be done monthly. A range of 35-40 days is acceptable, which indicates an efficient collection process. Monitor your AR closely for financial class issues such as self-pay and MVA. This should help you to identify the problem areas.
Percentage of Aged Ar Out of Total AR
Healthcare organizations typically monitor AR in 30-day increments. 90 days is the best-practice benchmark for collectability. Anything below that amount has a high chance of being paid, and anything above that number, will not be paid at all. If your patient mix is more complicated with a higher denial percentage, then no more than 25% should be in AR.
As accounts approach the 90-day mark, coordinate collection efforts. Also, remember that denials are a significant reason for aging AR.
Refers to unrecoverable patient debt. It indicates an organization’s ability to collect accounts and find payer sources for those who are unable to pay their bills. Learn to identify and target problem areas by financial category in order to reduce bad debt.
Patients and providers can benefit from having on-site patient advocates. They will help determine whether they are eligible for Medicaid or any other assistance. Recent surveys revealed that 40% of those receiving assistance said they wouldn’t have found it without help. This highlights the importance of patient advocacy to assist those in need.
Another 12% said they tried to get help to enroll but couldn’t find it. This highlights the need for healthcare organizations to recognize unmet financial requirements and increase patient engagement in order to reduce bad debt.
- Payout depends on the efforts of your department to coordinate claim follow-up and progress in the billing cycle. You should not leave claims unadjudicated for more than 30 days. This will result in a loss of 5% of your total claims. This is a key performance indicator that can help you collect payments and reduce aged AR.
A Medical Billing Service can help you reduce denials, payment delays, and mounting AR. We will need to change the way we do business and medicine in the aftermath of a pandemic. We have the technology and the will to adapt to new RCM policies. A partnership with a respected medical billing and practice management firm, such as M-Scribe Technologies will allow your AR department to reduce the coding/billing workload and ensure that all claims are accurate and clean.
Your revenue collection rates will be higher if your RCM is trusted to a professional in the medical practice management field. M-Scribe has assisted thousands of organizations and practices of all sizes and specialties to manage their billing, collections, and other practice management needs.