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RCM: Maintaining your financial health

 

Revenue Cycle Management (RCM) has always been a pertinent focus for medical practices. It is important to make sure that proactive measures are being made on a regular basis to remain compliant and also maintain a viable revenue stream. Identifying Key Performance Indicators (KPIs) and tracking these goal metrics on a monthly basis is a great foundation for RCM. Certain metrics such as accounts receivable (AR) greater than 90 days, net collection rate, and days in AR should be viewed as the Leading Performance Indicators (LPIs) and should be monitored more frequently than monthly to catch any issues before a decline in revenue occurs. Understanding how the metrics fall in line with MGMA benchmarks will be an easy way to identify key areas for improvement as well as areas of success.

In addition to tracking goal metrics, it is important to remember the major impacts of the revenue cycle such as the insurance payer mix, the internal processes for charge posting, the structure of the practice and type of care provided by the physician(s), as well as the Information Technology infrastructure that supports the practice. Throughout the RCM process there are several setbacks that can delay or potentially eliminate the chance for payment. Monitoring the front and back office operations, point of service collections, charge posting and coding accuracies, and the accounts receivables are all great areas to have measurable metrics on to maintain financial health. For example, the illustration below outlines the estimated costs for having to rework a denied claim, which is $15/claim. These costs include all employee research and correspondence related to the claim as well as the steps taken to get the claim resubmitted. Each time a claim has to be reworked, profit margins are decreased, making it very important to have clean claims on the front end. 

 

As a reminder, WebsterRogers is equipped to help you with all of the areas of opportunity outlined in this article. We are here for you! 

If you have questions or need help with revenue cycle management, please contact Jaime Brabb at (843) 577-5843 or jbrabb@websterrogers.com.

 
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Nelda Fields | Debra Turner
Nelda Fields | Debra Turner
Healthcare Services Group | Partners
(843) 577-5843
healthcare@websterrogers.com
40 Calhoun Street, Suite 320
Charleston, SC 29401
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