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Efficient billing and collections is critical to the success and profitability of your center, and any efforts you make to improve efficiency can help you better capture money you earn and avoid your leaving money on the table. To help with your efforts, we give you 10 benchmarks to target for your operations and then offer 10 best practices to make meeting these benchmarks a reality.
Benchmarks
Use the following 10 benchmarks as good targets to consider for your ASC.
1. Days in A/R — Fewer than 45 for ASCs with a combination of paper and electronic billing; 20 to 35 days for centers conducting mostly electronic billing, which includes submitting electronic patient statements, suggests Vickie Sanders, vice president of business office services for Nueterra Healthcare.
2. Insurance verification — Within three to five days before date of service, suggests Alexandra Reyes, RN, administrator for Treasure Coast Center for Surgery in Stuart, Fla.
“You don’t always get an authorization at the moment when you make that call,” she says. “But as soon as insurance verification is completed, you need to turn around and call patients to notify them of their responsibilities, at least three to five days prior to their date of service. It’s only fair to make them aware of what their deductible or co-pay will be to avoid any problems on the day of surgery.”
3. Transcription — Within 24 hours or less after the the procedure is performed, if not before, suggests Ms. Sanders.
4. Coding — Completed within 48 hours or less. “The claim should also go out the door the same day the case is coded and charged,” says Ms. Sanders.
5. Claims billed out — Within 24 to 72 hours from date of service, suggests Ms. Sanders, with the higher-end target to account for possible delays caused by issues such as time needed to resolve any discrepancies concerning procedure information or slow dictation from surgeons, but 72 hours should be the exception and not the rule. You may want to consider a more aggressive benchmark — with the understanding that occasional issues will hold up the process — and target to have claims sent out within 24 hours, as is the benchmark for Treasure Coast Center for Surgery.
6. Claims follow-up — Within 28 days for those that remain unpaid, says Ms. Reyes. “All claims need to be touched, again, at least every 28 days until the claim is resolved,” she says.
For centers filing mostly electronic claims, you may want to keep that benchmark lower.
“We’re always looking to see if (our centers) are following up on their accounts in a timely manner,” says Ms. Sanders. “If they know they’re getting paid every ten days from a payor, then they should have a 15-day review if they haven’t received payment.”
7. Denial rate — 1 to 2 percent, suggest Ms. Sanders. “Tracking the reason you are not getting paid the first time a claim is billed is very important,” she says. “You need to identify the reason for denial and fix whatever the problem might be so that future claims will be paid the first time you bill, which will reduce the expense associated with claim filing and give you access to your cash that can be used for other expenses.”
8. Accounts per collector — Ms. Sanders suggests that a new center staff one collector per 350 to 400 cases performed per month. When reviewing your outstanding A/R, you should have one collector assigned per every 800 accounts, with the business office manager monitoring the collection activity closely to ensure accounts are being worked at a minimum of every 15 to 30 days, she suggests.
“We look at the number of accounts our centers have outstanding in their receivables,” she says. If the center has been open for awhile and there are 2,400 outstanding accounts, and a collector can only follow up on about 800 accounts per month or 40 accounts per day you would need three collectors to work through the entire receivable in one month.
9. Cash collections as a percent of net revenue — At a minimum, the collection goal should be 100 percent of your monthly average net revenue for the preceding three months, suggests Ms. Sanders.
“We track and trend this goal monthly, and if we are short in our overall collections for the month, the collection shortfall is added into the next month’s collection goal,” she says. “By adding back in the cash shortfall from the prior month to our current month’s collection goal, we anticipate at the end of the year we will have reached 100 percent cash to net revenue for that year.”
10. Aged A/R greater than 60 days and aged A/R greater than 120 days — Less than 25 percent of your A/R in the 60-day bucket and less than 10 percent in the 120-day bucket, suggest Ms. Sanders.
“We monitor our A/R closely, watching what percentage of A/R rolls into all buckets but specifically these buckets,” she says. “If the A/R starts to climb in these two buckets, a manager will review in detail what might be causing the increase in AR. The manager may add additional resources if necessary or identify that there are one or two accounts that are causing the problem and escalate the work effort to get these accounts paid. Monitoring your A/R buckets is critical in keeping your AR clean and not letting it get out of control.”
Best practices
Here are 10 best practices you can use to help meet your benchmarks and improve your overall efficiency.
1. Post your targets.
A terrific motivator for staff members is to put their goals on display and reward them when meet or beating the targets.
“Our business office manager posts goals and targets for the employees in his office,” says Ms. Reyes. “He does a monthly cash collections goal; front-end collections goal (percentage) and business office goals. It gives the employees the motivation to strive and to do better. If the staff meets the goal, I reward the center and we’ll go out to lunch. The entire center feels like they accomplished something.”
2. Post your figures.
A different approach you can take is to display the actual figures associated with your day’s work.
“We track our reimbursement on a dry-erase board in the business office area so each day we see how many cases we’ve performed, how much in collections was received and how many days out we are,” which is recalculated every day, says Di Sweet, administrator for the Brookside Surgery Center in Battle Creek, Mich. “My surgeon owners like to go by and say ‘wow, we’ve collected that much so far’ or ‘we’re that many days out, what’s going on?’ It’s a right in-your-face indication of your business.”
3. Conduct a “core audit.”
If a high percentage of your A/R is falling in the 90-day and over range, consider performing what Ms. Sanders calls a “core audit,“ which is a comprehensive review of what your revenue cycle, starting from beginning of the billing and collections process (scheduling) to the end (completing the medical record).
“We look at everything,” she says. “We make sure they are verifying insurance benefits timely and that they are tracking what has and has not been verified. We want our business office managers to know whether or not their business office staff actually called to get verification of benefits so that nothing falls through the cracks. We make sure that they’ve done their own precertification and not let the physician’s office do their precertification for them
“And even if the doctor’s office is getting the precertifications, the center is required to call the insurance company to confirm that the precertification covers the facility as well as the physician to avoid any potential pre-certification denials,” she says. “Also, as part of our core audit, we complete a chart review, which is based on 10 percent of the center’s monthly volume. We look to ensure that the chart is in complete order from gathering demographic information to ensuring we have adequate follow up documented to ensure timely payment.”
4. Instruct coders to code everything.
Under the new ASC payment system, ASCs must now deal with quarterly changes for reimbursement of drugs and ancillary services with Medicare. With such frequent updates, it can be easy to miss new opportunities to capture reimbursement.
To help ensure reimbursement isn’t left on the table, consider instructing your coders to code out everything in the operative note, as is the practice of the coders instructed by Serbin Surgery Center Billing, says Dawn Gray, CPC, CCP, its director of operations.
“Then the codes are put (through) CCI edits to ensure there are no bundling issues,” says Ms. Gray. “They (go) through what is and is not billable. This way they cannot miss any codes that may have been added to the approved list.”
5. Pay close attention to secondary payors.
For those cases which you are filing claims with secondary payors, it is important that your business office staff pays close attention to secondary payors’ rules and understands what they will pay you for or you could miss out on reimbursement opportunities.
This may become particularly important if the primary payor will not cover implants but the secondary payor will, says Ms. Sweet. If this opportunity presents itself, encourage your biller to take a little more time to work with the secondary payor even before sending out the claim for the primary payor. This will help ensure your biller understands what it is your organization needs to do to receive complete payment from the secondary payor. You may need to attach the primary payor’s explanation of benefits to the claim you file with the secondary payor to prove what procedures and implants the primary payor covered and what it did not.
While such caution may mean that claims take a little longer to go out the door, if the benefits mean that you capture a few thousand more dollars, the delay will justify itself.
6. Identify barriers preventing efficient physician dictation.
A common issue that can hold up the billing process is slow physician dictation. If this is the case, you should work to identify the cause and see what you can do to assist the physician in completing dictation in a more-timely manner, says Ms. Sanders.
For example, if your center is running three ORs at the same time and have cases stacked one after another and there are only one or two phones available in the sterile corridor for all of your surgeons to use, you may want to look into adding a new phone line or two to ensure all physicians performing procedures will definitely have the use of a phone when they want it, says Ms. Sanders.
“Or if the physician is immediately leaving the ASC (after surgery) to go to the hospital, look at what you can do to help him make sure he gets his dictation done at the office that evening or from home,” she says. Make it easy for the physician to dictate. Use a service that allows them to dictate from anywhere whether it is from the ASC, their office or home.
“Just try to determine what the reason is why the physician wouldn’t be dictating immediately after the case” and see if there’s a way to remedy the situation, she says. Your physician will likely appreciate the effort to make their dictations more convenient and your center will benefit from timelier dictations.
7. Be careful not to blindly rely on the clearinghouse’s messages.
The relationship between your software (and its vendor), your clearinghouse and the payors is a constant challenge, says Ms. Gray, with frequent finger-pointing and passing blame. Your software vendor and clearinghouse should have a good working relationship. The billing software should have batch reports that easily match uploaded batches in the clearinghouse reporting system.
“There are numerous reasons given for claims going into the black hole and you have to stay on top of the process,” she says. “Don’t assume that just because it is billed and shows ‘accepted’ by the payor with your clearinghouse that this means it is processing. Payors do not have standardized acceptance reports; every report looks different and often times doesn’t explain rejections. Have you ever seen the ‘loops and segments’ setup portion of electronic billing? If one small thing changes in the way the ASC submits the claim or the way the payor receives it, the claim seems to fall through the cracks during claim submission.”
Make sure that any change is communicated to the clearinghouse so they can properly set up and process the claims. By having this position — and dedicating a full-time staff member who does nothing but work as the liaison between the ASC software, clearinghouse and payors — Ms. Gray says the X12 conversion the software had to go through in order to prepare for the mandatory use of the NPI numbers went much more smoothly.
“Our biggest challenge here was the payors not being ready, and by having this position, we immediately knew if a payor wasn’t ready and handled the claim accordingly,” she says.
8. Hold collectors accountable.
With your collectors juggling many accounts, it can be easy for mistakes to occur. While the occasional error may not significantly harm your ASC, if it happens repeatedly and is not detected for a significant amount of time, the impact could be tremendous. Besides some of the methods intended to catch problems already described, consider ways to hold your staff members accountable and carefully monitor their work, suggests Ms. Reyes.
“The collections process should be very structured and you have to assign accountability to the individual that’s doing it,” she says. “You’re doing checks and balances; you’re making sure that person is actually doing what they’re supposed to be doing. We monitor (our collector) on a daily basis.
You look at the schedule and depending on what cases you have, what your payors are, you’ll know how you should be doing. For example, for Medicare patients, there’s no co-pay. If you see that you have a whole day of Medicare cases, you know not to expect anything in your money box.”
At the end of each day, either the business office manager or a billing staff member comes to the Treasure Coast Center for Surgery and takes the money box to the business office and reviews what was collected during the day, Ms. Reyes says. Through this process, any mistakes are caught and fixed sooner, and are less likely to be repeated the following day.
9. Try to get paid for high-ticket disposables.
Missed opportunities to receive reimbursement for your implants or disposables could mean losing hundreds to thousands of dollars, which is why you want to have a strong process in place to capture implant charges.
“If you don’t have a tight communication between your materials manager, the business office manager and the billing person, a lot of times you can lose money,” says Ms. Reyes. “It’s just the matter of putting a process together and making sure everyone is well-versed in it. Here we do high volume of ophthalmology and orthopedics, both which require high-ticket implants. As soon as we see that we have used an implant, the materials manager passes on a form — (describing) the implant that was used for the particular patient, for the particular case — to the business office manager and to the billing person so they know to bill for that implant right away.”
Ms. Reyes suggests implementing such a process even for those high-ticket disposables which you do not expect reimbursement. Her staff is instructed to try bill for any disposable costing more than $100.
“There’s only a handful of payors that will cover disposables and most of them won’t even look at it if it’s under about $100,” she says. “So anything that’s over $100, when in doubt, put it on. It can’t hurt. The worst that happens is they’ll save they won’t cover it, but at least you try.”
There are instances where payors will reimburse for the disposable and then you have captured potentially lost dollars with an easy process. Such a process will help that you do not miss opportunities because of recent changes in a payor’s policy, and it is also helpful to capture reimbursement when adding new procedures and specialties for which you are just learning payors’ rules.
“We’re looking to add GYN, which often uses expensive ($1,000-plus) disposables,” Ms. Reyes says. “Having the process in place already will help capture some of these dollars.”
10. Cut down time spent on appeals by documenting payor rules.
Payors may seem like they have their own “top secret” CCI edits because they are not wiling to share their rules or your questions about policies go unanswered or are answered incompletely. If you do not have a clear understanding of a payor’s rules, this can lead to significant — and potentially fruitless — time spent appealing rejected claims. Since the payors won’t always help you out, you need to help yourself.
“The best way we cut down on endless appeals was we spent time documenting the bundling code pairs and going through the appeal process for additional reimbursement,” says Ms. Gray. “In doing this, we were able to identify which codes will always deny when billed together regardless of modifier usage for a separately billable procedure. On those codes, we created a policy that when those code pairs were billed to that payor and denied, no further appeals would be done.”
Contact Rob Kurtz at
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