4 tips to improve revenue cycle now

At Becker's Hospital Review's 4th Annual Health IT + Revenue Cycle conference in Chicago, three healthcare industry experts offered tips for hospital and health systems seeking to reduce claim denials, improve the patient financial experience and overcome other revenue cycle challenges.

Here are the four tips:

1. Establish a denial prevention program, not a denial management program. Insurance claim denials delay payments and can confuse and frustrate patients. They ultimately negatively affect patient financial satisfaction and prevent the revenue cycle from running efficiently. While many hospitals turn to denial management programs, they should instead be trying to establish a denial prevention program, said Patrick Murphy, vice president of business services for TruBridge, a revenue cycle management solution provider.

"Ultimately you shouldn't have a denial management program. Any errors should be stopped before they go out the door, before they are submitted. This means working with payers and provider representatives and collaborating to work through denials on the front end."

2. Create a strategic plan for RCM. Many hospitals and health systems establish strategic plans for capital budgets, physician recruitment and construction. However, not many health systems create these plans or complete an assessment for the revenue cycle. But these plans are important to understand areas that need improvement and areas the hospital already does well, Mr. Murphy said.

3. Co-sourcing beats outsourcing. Do not be afraid of partnering with someone who can offer a solution to a problem in the revenue cycle. The key word is partnering, explained Kristine Monus, administrative director of finance, physician and continuum of care revenue cycle at Toledo, Ohio-based ProMedica.

At Toledo, Ohio-based ProMedica, the revenue cycle team had to partner with a sourcing vendor because they had a lot of turnover and not enough staff members to accomplish all revenue cycle duties on their own.

"We used the term co-sourcing instead of outsourcing," Ms. Monus said. "It was more palpable to our staff, and it explains what it really is — a partnership where everyone has skin in the game. It is another partner. Using the term co-sourcing helped our staff understand that."

4. Engage the payers. Payers want to auto-adjudicate. However, this strictly manual process is not letting either side win because there is a lack of transparency, said Thomas Boehning, CEO of Optum360. Payers and providers fight over the same claims — with hundreds of clinicians on both sides reviewing claims daily.  The problem is that there isn't a lot transparency in the middle, with each side having their own set of rules. By engaging payers, both sides can attempt to eliminate the administrative costs of fighting over a claim.  

"If we can find a common way [with the payer] to agree to deliver more transparency in the middle. The problem is solved, and you take out so much of the friction in the industry," Mr. Boehning said.

Mr. Murphy suggested obtaining a copy of the payer-provider contract, with all of its "guts." Often, providers use contracts that say refer to the billing policy manual. The problem is that providers change these billing policies often.

"Make them show you the contract. The full contract," Mr. Murphy said.

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Fitch: Nonprofit hospital balance sheet metrics improve, operating margins don't

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