Revenue cycle management is an ongoing process that requires consistent effort to be successful. Most people focus on billing when they think about the revenue cycle, but submitting claims is just a small step in the process. Managing the revenue cycle requires oversight of every step, identification of improvements, and implementation of solutions. Looking at the entire revenue cycle allows you to see all the steps simultaneously and how they affect one another.
This process, like most, starts with root cause analysis. Understanding the root cause of any situation helps manage it and can proactively prevent problems from developing. In your practice, getting to the cause of any problem will be helpful—whether it is employee related, a loss of a revenue stream, or an issue with your revenue cycle.
At CBS we utilize these steps to, as we like to call it, put the management in revenue cycle management.
Step 1: Identify the problem.
The process I’m sharing can be applied to any problem you identify, but for our examples I’ll use these common issues that can affect your revenue cycle:
- A decrease in your clean claim rate
- An increase in overall denials
- A slow in cash flow
- An increase in your accounts receivable aging
Step 2: Start gathering information related to the problem.
Why are you seeing a decrease in clean claims or an increase in overall denials, for example?
- Lack of documentation?
- Timely filing errors?
- Coding errors?
Step 3: Analyze the information that you have gathered.
Why are these errors happening?
Lack of documentation:
- Are there specific clinician’s claims that are getting denied?
- Is your staff properly educated on the specific requirements that are necessary to get the claim paid correctly?
- Is the documentation from the ordering physician corroborated by the practitioner’s documentation?
Timely filing errors:
- How many days from delivery does it take to bill claims?
- What are your carriers’ filing limits?
- How often are claims worked?
- Does the K-level meet LCD documentation requirements?
- Is the wrong modifier being used?
- Does the L-Code meet LCD documentation requirements?
Step 4: Manage the revenue cycle problem with corrective action.
Managing your revenue cycle is all about turning problems into successes. We do this by making the following improvements:
- Change your internal protocol to address the issues you identified. Utilize your work in progress to ensure the changes in protocol are being followed. Set rules within your patient management software system that will pop up as helpful reminders with each procedure code. For example, in an effective work-in-progress system, if you created a corrective action about documentation for a device that is frequently denied, it will not allow a claim to be moved to the next step without a compliant note from the practitioner.
- Ensure the corrective action is reasonable and that the team can comply with it.
- Educate the staff on the change in protocol.
- Follow up to ensure the correction is working.
How you manage your revenue cycle will determine how quickly or slowly your cashflow comes in and how financially healthy your practice is. Think of your practice like an oak tree and the revenue cycle like the roots. If the roots are healthy and strong, the tree will grow and be able to sustain any kind of storm. Neglect the health of the roots, and the tree won’t be able to reach its full potential.
Erin Cammarata is president and owner of CBS Medical Billing and Consulting. She can be contacted at [email protected].