How to Prevent Loss of Cash Flow in Your Practice - Part III


Click here for Part IISuggested Strategies for Bolstering Your Practice's Financial Health

Review cycle times for claims submission and reimbursementMost practice management systems maintain information on date of entry, date of service, and date of submission. Use this data to better understand whether you are managing claims efficiently (How much time lapses between date of entry and date of submission? Should you process claims more frequently?) or your providers are submitting charges in a timely fashion.

Reviewing collection performance indicators

On a monthly basis you should be examining:

• How often is self-pay cash collected?

• What percentage of co-pays are collected in the office at time of service

• Analyze cllection activity — What accounts are turned over? What is written off?

On a quarterly basis, examine:

• From where your self-pay referrals are coming

• Credit and small balance reports

• Cost-based optimization audits — Who performs what activities? How many activities are they performing and at what frequency?

Manage claims for coding errors daily

Proactive dialogue leads to fixes on front-end problems, rather than reactivity that leads to dealing with the same problems over and over

Review your level of automation

Automation improves cash management by providing faster, more accurate generation of payment data. Faster payment processing means your staff can get to denial and exception management sooner and helps eliminate the distraction of routine data entry duties.

Further, automation produces data which allows you to enhance your business intelligence efforts, which in turn will lead to increases in profitability. Better performers bill 95% of their claims electronically. The average practice sits around 93%.

Front and back end best practices

Ensure efficiencies by instituting and/or standardizing processes for back-end tasks.

• What is your process for handling returned claims and statements? How are they tracked and resolved

• How are zero payments (deductibles) posted?

• How are denied claims posted and tracked?

• What is your process for handling underpayments?

• How are rejections tracked and resolved?

• What is your process for handling credit balances?

Do the same on the front end:

• Eliminate exposure to fraud through patient ID vailidation

• Always ensure eligibility verification and get service authorization

• Establish a patient propensity-to-pay scoring system in order to identify problem payers early

• Perform a proactive review of self-pay accounts for coverage

• Constantly monitor your contract reimbursement terms

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