October 1, 2007

Achieving Optimal Revenue in a Physician Practice
By Komal Choudhry
For The Record
Vol. 19 No. 20 P. 14

There’s not one standard method to improve revenue cycle management, and it’s not something healthcare organizations can do once and not think about again. It is a constant effort geared toward improvement. With that in mind, here are several areas to focus on so cash flow remains swift and current.

Patient Balances
The goal is to minimize these balances and maximize patient collections. Patient balances can quickly add up and, over time, become more difficult to collect. As soon as a balance is due, staff should try to collect it. The first bill should be sent out immediately, and the front desk should have access to patient balances so it can issue patient reminders. Patient bills should be mailed regularly, and decisions for which balances to send to collections should be made on a consistent basis. A practice should take a firm but fair approach to maximize collecting patient balances. Don’t be afraid to ask patients to pay—you have every right to collect a payment.

Include More Services
Be careful that the equipment is not pricier than the actual reimbursement. A simple analysis can be done by multiplying the reimbursement by the number of patients who will receive the service. Don’t rely solely on the vendor’s reimbursement numbers; be sure to check the reimbursement figures of several insurance plans as well.

Reimbursement also depends on the practice’s specialty. At the same time, adding tests can truly add to the bottom line. Also, be sure you understand how to code for the procedure to ensure proper payment and the shortest payment cycle.

Submit Claims on Time
This sounds simple, maybe even logical. Still, are your claims being submitted on a regular basis, or are some held back because of missing or incorrect information? Ensuring you have everything, from correct patient demographics and insurance information (including services performed outside the office) to referring physician information, will enable all claims to be regularly submitted and revenue to come in steadily.

Proper Documentation
Depending on your specialty and the claim specifics, the insurance company may request to see the documentation. Have documentation typed at the time of the encounter so that it’s available to submit immediately. Not doing so will cause a delay of at least two days.
Follow up With Insurance Plans

Behind submitting clean claims, this is the second most important billing task. If follow-up is ignored, healthcare organizations won’t know the status of unpaid claims. Also, make sure phone calls are being made to determine the status of denials and unacknowledged claims. It’s time-consuming, but it’s necessary to ensure that the organization is maximizing its revenue.

Equipment Consolidation
Think about the equipment in your office. For example, do you have five different brands of fax machines? That means five different toners and understanding how five different machines operate. Are you even using all of them? Consolidating and streamlining by using the same fax machine manufacturer will help save money. The same goes for printers and copiers.

In-house billing
How much time are billers spending on data entry? Could an investment in technology allow them to spend more time following up on claims and collecting patient balances? Whether you need to improve workflow or implement a practice management system, cutting data entry time is a must.

By writing neatly, physicians will eliminate the need for billers to question their diagnosis codes. This saves time and possible lost revenue if the diagnosis in question is never clarified. Outsourcing billing can help free staff to perform other tasks related to patients and the practice while still being cost-effective.

Are You Billing for All Services?
Many providers are not billing for services they perform and in some cases are losing tens of thousands of dollars per year. If you are a surgeon, do you have a certified coder reviewing your operative notes and making certain you are billing optimally? Or have you been billing for the same procedures for the past 10 years?

You also may be billing incorrectly. Have someone occasionally review your coding to make sure you are coding all you can and are up-to-date with code changes. Maintain knowledge about codes, coding, and medical necessity instead of relying completely on your billers. Doing so creates a smoother flow in billing.

Education
Make sure staff is knowledgeable about insurance issues and the basics that influence billing. The front desk should be able to understand how to read insurance cards—at minimum—and accurately enter patient information. Checking insurance eligibility, which can help prevent denials, has become easier thanks to the Internet and better customer service from insurance plans.

There are several factors that influence an organization’s revenue cycle. To see an improvement and a steady flow of income, permanent changes must be monitored on a regular basis. Inherently simple measures can yield great results. Providers have to work at it on a daily basis, but nothing short of that will get you the desired results—an improved revenue cycle.

— Komal Choudhry is an executive for DocComply, a company that provides an integrated electronic medical record/practice management solution to physicians, and a freelance medical writer.