Healthcare providers develop scorecards and produce numerous reports on accounts receivable (AR), but often fail to provide actionable conclusions. This negligence creates a strong resistance to the implementation of performance improvements and may hinder efforts to reduce the aging balance.
To help revenue cycle leaders shorten their reporting efforts and ultimately collect more funds, here are five questions they should ask their AR worklist to determine opportunities for performance improvement.
1. Does my work list accurately reflect the risks of my account?
The job list usually uses age, balance, payer, and sometimes rejection status to determine the priority of the job. In the simplest method, processing the highest amount of claims first usually results in multiple contacts with newly billed claims, and too little effort is spent on other balances.
An ideal, risk-based approach divides claims into risk categories, prioritizing age and balance. The highest and oldest claims are given priority first, and as the age and balance fall, the priority gradually decreases.The result should be like this [Click image to enlarge]:
Only 2% of the transaction volume covered 38% of the balance, while only 24% of the transaction volume covered 91% of the balance.
2. How often do I process my difficult claims to AR employees?
When selecting claims for the next job, workers tend to prioritize complex claims, which usually also have high balances. You can choose simple statements that are easy to collect, rather than complex statements that require more effort. Difficult claims may be ignored in favor of simple claims, which can improve productivity measures but may not significantly improve financial results. We recently worked with a health system with a balance of US$27 million, which has not been moved for 60 days or more! The right work queue tool will provide reports on contact time and frequency, but management should also measure the results and reward people who collect more. The combination of technology and supervision will ensure that old, high-value claims are processed regularly, leading to healthier AR.
3. Does my employee have access to claims within 30 days?
The ability to identify when a claim has been touched can also help determine when to deal with a claim that shouldn’t be dealt with. Unless there is a fundamental failure in the billing process, the risk of not receiving a single large claim is less than the risk of overtime for a small claim. Medical insurance claims may not be of concern until they are at least 21 days after the bill, and most commercial claims take 30-45 days. Before these time limits, any employee’s time spent checking claims could be wasted.
4. Is there a black hole in my work queue?
The only thing worse than filing a claim too early is not filing a claim at all. When AR system users leave the organization or change responsibilities, most of their work lists may be reassigned, but if one (or more) is omitted, a small part of AR may still not work. These statements are active and require attention, but will never be presented to users. Doesn’t work, they eventually time out.
The most effective workflow tools provide claims reports that are not assigned to any list, but regular manual reconciliations between the work list and detailed old spreadsheets can provide positive evidence that no accounts are in decline.
5. Which claims are touched most often?
The ideal situation is to pay the claim without intervention, but if the payer refuses to appeal, the number of contacts may increase rapidly. For complex claims, staff may need 20 or more contacts to resolve the claim.
When a single user fails to process a claim multiple times, a large number of touches may indicate a problem. The staff did not do a good job in handling claims, or they didn’t know what to do at all.
Any claims with more than five follow-up contacts are candidates for further review, and any claims with more than 10 times are worthy of management’s attention. A good workflow tool will provide reports and insights about these groups of people, which allows the formal process of reviewing claims through a certain number of contacts to determine training needs.
Although these queries do not replace powerful and conventional dashboards or other reporting mechanisms, asking these questions can help identify parts of AR that are not properly resolved. By understanding these deficiencies and taking action to resolve them, you can collect more dollars, reduce your aging balance and enjoy healthier AR.
Photo: ipopba, Getty Images
