Performance Improvement in the Business Office
Medical billing is complex. And with patients bearing more financial responsibility these days, there is increasing importance for the practice to get billing right the first time. Improving performance in the billing office is essential.
After reading this article you will be able to:
- Determine if business office staff are doing the right tasks
- Determine ways to use data to promote teamwork
- Establish processes that work to speed up cash flow
Medical billing is complex. And with patients bearing more financial responsibility these days, the onus is on your practice to get billing right the first time. If it's been a few years since you've evaluated your practice's revenue cycle, take a close look at it now. Conduct a top-to-bottom review of how information related to billing moves throughout the practice. You may find unnecessary or duplicated steps in a process. You may discover inefficient handoffs between various processes. You may even find entire processes to eliminate in favor of automated or outsourced solutions. Consider ways to measure staff productivity. With this knowledge, you'll be in better position to determine if you have the right amount of employees — and whether they are doing the right tasks.
Here's where to look:
Assess staffing levels. Physician productivity has a significant impact on how much billing support is needed. One full-time-equivalent (FTE) physician may produce 50 claims a day; another may average 15 claims a day. Use the ratio of 1 FTE billing staff person per 10,000 claims annually (including primary and secondary submissions, as well as rebills) to start right-sizing your business office. Use this ratio only for the staff who handle claims and payments, not those who enter charges. If you have people doing a bit of both, compute the percentage of their time spent just on billing and convert it to a percentage of FTE — for example, the person who keys charges in the mornings and performs billing in the afternoons would count as .50 FTE in this computation. The ratio should be positively influenced as your practice adopts more technology; that is, less employees are needed for a higher volume of claims. It is of note that a practice with challenging payers, such as worker's compensation or certain managed care companies, may need more staff to perform the same tasks as a practice that primarily processes Medicare claims. If it’s impossible to perform this calculation, fall back on the industry average of 0.50 FTE staff per physician.
Use data to encourage teamwork. Teamwork requires constant attention. Many factors influence a business office's performance: technology, experience, payer mix, number of payers, physician specialty, and so on. Use data to identify opportunities for improvement. The explanations given on payer rejections can point to specific areas where improvement is needed, such as encouraging the front office to do a better job of gathering patient demographics or checking insurance eligibility. Measure the amount of timely filing denials but also look into the causes; you want to learn what's behind excessive lag times between the date of service and the date the charge is entered, for example. It may be that physician documentation is running weeks behind, or that no one accounted for the fact that your coder went on leave.
Establish processes that work. Sit down for a few minutes with each employee in the business office and review in detail what they do — every task. Look for duplication of work. Scrutinize procedures that don't make sense, such as producing duplicative paperwork, as well as processes that could be done automatically instead of manually. Determine solutions that payers or vendors can offer, such as electronic remittance, automated eligibility verification, charge scrubbing, and so on. Whatever you can do to improve processes not only speeds up cash flow, it also frees up your business office employees to work on other matters that require more effort, such as researching denials or pursuing the collection of aging balances.
Involve everyone in the cycle. If your practice considers collections the sole responsibility of the business office then you're probably leaving money on the table — and a lot of money at that. Everyone in the practice must be aware of how their actions influence the entire billing process. If you can break down what percentage of denials is caused by mistakes at the front office, be sure to share this information with those employees. Go a step further and involve them in seeking solutions to persistent problems, such as spotty time of service collections. Most importantly, don't allow squabbles and finger pointing between front office and business office personnel to supersede the larger goal of improving how your revenue cycle functions.
Whether it is tightening your collections cycle or working denials more diligently, the challenge is to determine the optimum resources of staff and technology you must to devote to billing. While many medical practices may determine that they are under- or overstaffed in their business office; most are, in fact, mis-staffed. In other words, people may not be doing the right tasks. Take a close look at your billing operation and look for ways to encourage better performance.
Pearl: Performance in the PM
Before money is lost due to overwhelmed or uneducated billing office employees, integrate employee performance measurement technology into your practice management (PM) system. Most PM systems track data by employee, including volume of accounts worked, and the time between initial entry and follow up. Your employees may not always willingly hand it over, but it’s certainly worth knowing how to access these data.
Pearl: Payment Processing
Posting payments is a time-consuming process. Moreover, it must be done with complete accuracy; a single keystroke mistake results in time-consuming work later. Most third-party payers are now offering electronic remittance and funds transfer instead. The funds are automatically deposited to your bank account, and an electronic interface allows the payments to be automatically posted directly to your billing system. Patient checks can also be converted into an electronic transaction; check with your bank to determine whether they offer this service. Instead of keying, use the opportunity to turn the attention of your business office associates to working denials, submitting appeals, and pursuing collections.
Pearl: Financial Clearance
In order to understand what to collect from the patient, it's essential to perform a financial clearance before the visit. This process consists of three functions: insurance coverage (a basic and essential clearance); benefits eligibility (necessary if there is a question regarding the patient's insurance eligibility for the services to be provided); and unmet deductible. Ideally, the process is automated and performed close to the time of the visit, while still allowing at least a day in between to contact the patient if there is a problem with coverage, or benefits.
Pearl: Patients as Payment Partners
Medical groups bill on behalf of their patients, as a courtesy. When something goes wrong with that process, ask them to help. If the payer denies a claim for information needed from a patient, contact the patient immediately. (Information-based denials are something you also should address in your payer contracts; e.g. allow the payer's beneficiaries 30 days to respond to the payer's request; if they don't, you can transfer financial responsibility to the beneficiary.) Patients should be copied on appeal letters to payers. It may prompt them to pick up the phone and call the payer. Of course, send statements to patients when bills are their financial responsibility, and hold them accountable for payment.