Is Your Practice Suffering From The #1 Cause Of Revenue Loss?
Pain is usually the first indicator that something is wrong. Identifying the cause of pain is the first step in diagnosis and treatment. Diagnosis is essential for developing a plan to relieve pain and cure the problem.
The medical practice can be viewed as a living organism of sorts comprised of human and technological components capable of experiencing differing levels of pain with multiple causes. Understanding the type, severity, and duration of the pain enables the practice to develop a treatment plan and provide the best “cure”.
The pain assessment questions used in patient care are quite helpful in diagnosing and treating practice management “pain”:
Where does it hurt?
When did the pain start? Was it a sudden onset or was it gradual?
How severe is the pain?
How many “systems” are affected?
Let’s look at some potential causes and best treatment options for the most common practice management concerns:
Staff acquisition, retention, and training
Hiring, training, and retaining quality staff is a pain point suffered by nearly every industry. The healthcare practice is not immune. Scheduling, benefits verification, and patient registration are step one in the billing process. If not done accurately, revenue will suffer. Simple process improvement and solid staff training has proven to reduce patient registration errors by 95% which has a corresponding improvement effect on claims payment.
Coding and documentation training
Accurate and complete clinical documentation and proper coding are step two in the billing process. Coding errors are one of the top reasons for claims rejections. Coding must accurately translates the clinical record into the alpha-numerical codes that are necessary for claims processing. Documentation must support medical necessity. We teach our provider teams to code correctly and produce accurate documentation to back it up. Clinical documentation improvement and accurate coding reduces claims rejections and protects the practice in the event of an audit. Claims rejection for coding errors can drop by 80% in the first 30 days when providers learn correct coding and documentation practices.
Provider contracting, credentialling, and managed care contract analysis
Claims rejections can occur when a provider is not contracted and credentialed or when the practice management system contains provider file or insurance file errors. Managed care contracts should be analyzed to determine if the contract is profitable or needs to be renegotiated. The cost of providing care has increased significantly in the past year. Contract analysis gives the practice the data to determine which contracts are worth continuing, which should be renegotiated, and if any should be terminated. Practices that review and analyze current contracts experience a 6-8% increase in revenue over 6 months.
All healthcare practices experience claims rejections and denials for a variety of reasons. Many are directly related to billing process efficiencies (or inefficiencies). Others can be associated with coding and documentation errors. Regardless of the reason, all denials and rejections are fixable and most are avoidable. A strong, well trained, efficiently managed administrative team is a critical element in mitigating and managing denials and rejections. Most practices run at about 5%-8% rejection rate. We strongly recommend that this be kept at 1%-2% to minimize the negative effect on revenue.
Denied claims can nearly be eliminated when all other essential elements are working efficiently. This is where many of our practices start as they recognize the negative effects denials and rejections have on the bottom line. Our denials management team works closely with the staff to develop process improvements and reduce denials bringing the rejection rates down to an acceptable rate of 1%-2%. Of course, our goals is always a 0% rejection rate.
If you are experiencing administrative “pain” associated with running your practice, give Pharus Practice Management Group a call. One of our experienced team members is ready to assess your pain and put you on a path to full recovery. Initial consultations are always free!
Main Office: (772) 924-2445