ASC revenue cycle key performance indicators to monitor (Part II)

Monitoring revenue cycle key performance indicators (KPIs) is an essential process for improving ASC business office productivity. But monitoring alone will not achieve the positive changes necessary to effectively grow the bottom line.

The first article in this two-part series identified ASC revenue cycle KPIs worth tracking while explaining the importance of monitoring these KPIs, sharing target benchmarks, and noting warning signs that may indicate a suffering KPI. This second part dives further down into these KPIs. For some, we note common problems associated with a poorly performing KPI and describe solutions to help overcome such obstacles to success. For others, we provide guidance for effectively analyzing trends.

Days to Bill/Charge Lag

Common problems:

• High provider dictation days. The goal should be same-day dictation.
• Providers not responding to coding queries or amending operative notes upon request.
• Missing documentation (e.g., pathology report, history and physical, implant log, invoice).
• Billing team issues (e.g., lack of resources, poor time management, workflow inefficiencies, insufficient knowledge of rules and processes).


• Require providers to dictate on the same day of the surgery. Implement a policy that penalizes providers who do not dictate in a timely manner.
• Establish an efficient process for business office staff to submit requests (e.g., coding questions, report amendments) to providers and receive timely responses.
• Closely track any missing documentation to ensure timely responses to payer requests. Note: Do not hold up billing for implant pricing if the implant is not covered by the payer.
• Address billing team deficiencies immediately. Improve the likelihood of identifying issues by monitoring team productivity, days to bill, clean claim submission percentage, tracking of held cases, and charge entry accuracy.

Days to Pay

Common problems:

• Billing delays.
• Charge entry or demographic entry errors that trigger rejections or denials.
• Paper claim submission.
• Failure to follow up on initial claim submission in a timely manner.


• Review the insurance and insurance identification entered in the demographic screen prior to claim submission to verify accurate entry.
• Perform quality assurance (QA) review of charges prior to claim submission.
• If a payer requires paper claim submission via USPS mail, follow up with the payer within 14 days to confirm the claim was received and is on file. Problems with paper claims submissions can contribute significantly to an increase in the metric.
• Follow up on all claims within 21 days of submission to ensure the claim was received and is in processing. This will also help identify denials sooner.

Specialty Volume Trending

Common problems: Negative case volume is typically attributed to poor scheduling, cancellations, and/or declining referrals.

Solutions: Trend volume monthly. This will help identify whether a top-paying specialty(s) has declined in volume. If such a decline is occurring, initiate a discussion with providers and business office leaders to determine the cause(s) of the volume decrease.

Payer Volume Trending

Common problems: Negative case volume is typically attributed to poor scheduling, cancellations, and/or declining referrals.

Solutions: Trend volume monthly. This will help identify whether a top-paying payer(s) has declined in volume. If such a decline is occurring, initiate a discussion with business office leaders to determine the cause(s) of the volume decrease. Pay close attention to cancellations and their reasons.

Accounts Receivable (AR) > 90

Common problems:

• Initial follow-up not occurring in a timely manner.
• Required invoices not submitted in a timely manner.
• Claim submission errors.
• Denials and appeals not addressed in a timely manner.
• Patient balances not worked diligently.
• Balance not resolved or dropped to the secondary insurance/patient after payment posting.


• Work all claims within 21 days of claim submission to ensure they are received and in process. Confirm that the payer requires no additional information.
• If the case includes a covered implant(s) but the invoice is not available upon claim submission, track and submit the invoice as soon as it is available.
• Perform QA review of all charges prior to claim submission to avoid errors that may delay payment and age the account.
• Identify all denials in a timely manner and address them within 48 hours of receipt. Submit appeals within 48 hours of receiving a low or incorrect payment.
• Treat patient balance AR as important as insurance AR. Work patient balances consistently. Implement a process to refer patients to collections when patients are unresponsive to outreach efforts and statements.
• Once paid by the primary payer, immediately drop the balance to the secondary insurance or patient.

Days in AR (i.e., Days Sales Outstanding)

Common problems:

• High percentage of litigation cases, workers' compensation cases, and/or out-of-network cases.
• AR not worked effectively or in a timely manner.
• Secondary insurances and/or patient balances not resolved in a timely manner.
• Appeals or denials not addressed in a timely manner.
• Problems associated with high AR greater than 90.


• Monitor days in AR by financial class to better determine offenders.
• Create reasonable benchmarks for each payer type. If even a slight increase occurs, there are likely recurring issues.
• Review cases under the offending financial class to better identify the reason(s) for the increase. Reviewing days in AR by financial class can help isolate the offenders without specific types of cases skewing the numbers.
• Complete an audit of the AR to further determine reasons why a specific financial class has a higher days in AR. Focus on the problems listed above.

Days to Dictate

Common problems:

• Provider failing to perform timely dictation.
• Provider failing to review and sign off on operative notes in a timely manner.


• Establish a dictation standard for each provider to follow. Rule of thumb: Dictate on the same day of the surgery.
• Create incentives and consequences for timely and untimely dictation.

Denial Rate

Common problems:

• Claim submission errors.
• Failure to submit documentation required by the payer (e.g., invoices, medical records).
• Billing for procedures not covered per local coverage determinations (LCD) (i.e., medical necessity) requirements.
• Front office issues, including failure to secure procedure authorization and incorrect verification of benefits and coverage specific to the scheduled procedure.


• Perform QA review on claims prior to submission to help ensure accuracy.
• Ensure the charge entry team understands the specific contracts and payer rules on required documentation for full payment of the claim. Submit documents up front.
• Coding and billing teams should understand when a code will not be payable. If the coding or billing team identifies a code that will not be payable, the business office should be notified immediately. If there is a non-payable code issued, conduct a code review with all medical records to determine whether there is an alternative, payable, and compliant code. If no such alternate code exists, the provider should review the case, along with the local coverage determination requirements, to determine whether an amended report is justified.
• Many front office issues can inflate the denial rate. Authorization is commonly associated with denials. Denials related to authorization can occur if the insurance representative fails to provide the correct information, the insurance verifier is not asking the correct questions, or the scheduled procedure code differs from what was performed. If the code changed and authorization was required, address it immediately. Some payers will only change an authorization up to 14 days past the date of service. If the change is not completed during the 14-day period, the payer will likely issue a permanent denial.

Denial Reason Trending

How to analyze the metric's trends:

• ICD-10 denials: Track the types of denials specific to ICD-10 and provide ongoing provider education.
• Authorization denials: Include authorization numbers on the claim form to avoid erroneous denials. If billing a different CPT code from what was scheduled, confirm whether updating the authorization is permissible with the payer or if a denial is first required before submitting an appeal. Immediately address instances of insurance verification team members failing to obtain required authorizations.
• Medical necessity denials: Provider education is the most important solution to decrease denials for medical necessity.

Clean Claim Percentage

How to analyze the metric's trends: The clean claim percentage declines each time a claim is submitted and rejected. There are many possible causes for rejections of claims, which a clearinghouse should identify and share. If the clean claim percentage decreases below 98%, evaluate the rejection reasons and implement a process to avoid them.

Percentage of Collections for Cases > 90 Days

How to analyze the metric's trends: Provided that work on AR buckets is consistent, the percentage of collections for cases greater than 90 days should remain consistent. If collections on older cases decrease, this may indicate the AR team is failing to focus on older AR and represents a potential follow-up opportunity.

Year-Over-Year Changes

How to analyze the metric's trends: If business is consistent year over year, all metrics should line up. This should allow for identification of typical lower and higher production/performing months. If volume and charges are consistent but cash is lower, this indicates one or more issues: contract, payer/specialty mix, and/or revenue cycle management (e.g., denials, authorizations).

Write-Off Percentages (Bad Debt, Denials, Timely Filing)

How to analyze the metric's trends: Best practice is to create specific journal codes to monitor back-end adjustments. Break out adjustments to track the type of denial or bad debt write-off. Monitor adjustments monthly. This will help ensure consistency in patient collection agency referrals.

Revenue Per Case

How to analyze the metric's trends: Trend revenue per case by financial class and specialty to ensure consistency. If a month drops significantly, this can indicate an issue with missed implants, missed charges, or a contract.

Credit Balance, Refund Trends, and Collection Agency Referrals

How to analyze these metrics' trends:

• Trending refunds, credit balances, and collection agency referrals is important to ensure there are no breakdowns in processes. Such processes often fall through the cracks. Keep them as high-priority responsibilities.
• Resolve patient credit balances monthly. When resolved monthly, refunds will remain current.
• Monitor for potential government overpayments. Refund any in a timely manner.
• Review all other insurance credit balances monthly. Note completion of the review in the account.

Supply Cost vs. Reimbursement

How to analyze this metric's trends:

• Many practice management systems provide visibility into materials management information and can perform cost analysis to help ensure no loss of revenue.
• Run necessary reports to identify areas of deficiency and address them immediately. This may involve losses due to medical necessity denials, providers using implants not covered per contracts, and other issues.

Cases in AR

How to analyze this metric's trends: Track and run reports on the total number of cases open in AR. This metric should be fairly consistent, particularly when AR is clean. If the total number of cases begins to track higher and volume remains consistent, this indicates a failure to resolve cases in a timely manner.

Patient Balances

How to analyze this metric's trends:

• Billing on the back end is not always necessary if the front office effectively verifies insurance benefits and calculates patient responsibility. If a patient is left with a balance after adjudication of a claim, begin sending statements immediately. Most ASCs send 2-3 statements and make at least 1-2 phone calls before turning accounts over to collections.
• Track refunds issued and balances owed by patients, broken down by payer. This will help identify if specific payers are associated with challenges faced by front office staff in their efforts to calculate patient responsibility.

Raise the Bar

Knowing KPI-associated problems to watch for, what corrective actions to take when performance starts to suffer, and how to more effectively assess KPI trends will put an ASC in a position to achieve meaningful, lasting improvements that can greatly impact short- and long-term financial stability and profitability.

Angela Mattioda ( is vice president of revenue cycle management services for Surgical Notes. Surgical Notes is a nationwide provider of revenue cycle solutions, including, transcription, coding, revenue cycle management (RCM), and document management applications for the ASC and surgical hospital markets. Mattioda oversees the SNBilling RCM service, the fastest-growing component of Surgical Notes' complete end-to-end revenue cycle solution offering.


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