No medical facility wants to lose money, and to maintain your funds, you need proper revenue cycle management. Unfortunately, some facilities don’t even know anything is wrong with their revenue cycle until they’re losing money. Fortunately, there are indicators that will let you know if your cycle is in need of adjusting. Here are signs of a failing revenue cycle.
Rising Account Receivables
If your revenue cycle has problems, this will usually be the first indicator. You need to be given current AR reports when each month is over, and these reports should be broken down both by ageing buckets and by payer.
Keep a close eye on your over 90 and 120-day buckets, seeing if either of them increases as time goes on. When you put these buckets together, they should never exceed 10-14 percent. It’s possible for payer trends to affect these numbers, at least for a short period of time, and in these situations, if you track data from the previous 3-4 months, you should have no trouble telling if ageing has gone up, dowm, or stayed steady.
During a 12-week interval, AR should be stable and going down, towards the 10 percent mark. If AR has started ageing to around 20 percent or greater, that’s when it’s time to bring in help from a billing company to address the AR issue.
Revenue Leakage
Perhaps your medical facility has given your patient the care they need, but the facility didn’t document all of the charges. This can easily cause revenue loss for your facility, and on top of that, claim denials are more likely.
You need to be sure that your billing company is billing for whatever services you give to your patients. There should be no missing charges, and if there are, you need to address them with your billing company. While there could be a miscommunication regarding which services are payable, you and your billing service should try to keep those miscommunications to a minimum.
Not Getting Claims Submitted Electronically
It’s typically not a good sign if your billing company isn’t submitting a lot of electronic claims. Using the most current billing technology is important because it allows for quick reimbursement.
Don’t be afraid to ask your billing company for their EDI portal’s numbers. This will tell you roughly how many claims get submitted digitally. You should also ask for how often first pass acceptance happens for your claims. First pass acceptance should never go below 97 percent. If it does, it likely means claims aren’t scrubbed before they get submitted.
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