Some of the biggest changes and challenges physicians have faced over the past year have been financial in nature. Most practices entered 2021 operating within razor-thin margins and needing an overhaul of revenue cycle management (RCM) strategies to ensure accurate and complete capture of all reimbursement opportunities.
Physician practices have the ability to make key moves to ensure their revenue cycle runs like a well-oiled machine. While change is never easy, it’s not too late to improve billing efforts and maximize reimbursements.
Admittedly, it’s impossible to fix everything at once. But what practices can do right now is address four areas that will have the biggest impact on the bottom line and ensure they’re staying ahead of the curve amid shifting billing and payment dynamics.
The more practices can do on the front end, before a patient sees a physician, the less likely they will encounter problems on the back end. Eligibility checks — reaching out to the billing clearinghouse, checking on deductions and coverage, and so forth — are probably the most important step. But rechecking eligibility is just as important as the initial check (e.g., to ensure a payer will cover X visits over a six-month interval). This is especially true in 2021, when job losses and health plans can change as quickly as an individual’s COVID or vaccine status. If a patient doesn’t get reauthorized, the doctor is doing their visit for free, and will have to write it off later.
Patient-responsible balances were on the rise before the pandemic. And as expected, the number of self-pay patient patients grew as unemployment rose in 2020, but that didn’t mean that patients were prepared to pay out-of-pocket health care costs. In one pre-pandemic study, as many as 68% of consumers said they weren’t prepared to pay surprise medical bills of $500 or less.
In addition to checking and rechecking eligibility, practices need to be up front about the costs of their services and offer plenty of opportunities for pre-payment and financing health procedures.
Coverage fluctuated so frequently in 2020 that many common errors were missed. But as a Medical Group Management Association (MGMA) correspondent pointed out in a recent op-ed, “Most practices find that 80% of their denials are a result of 20% of the problems.” In 2021, providers should pay closer attention to trends such as telehealth claims from a Medicare Advantage plan taking longer to get paid. Analytics platforms, which comb through claims data and identify codes and procedures associated with common denials, can help.
Write-offs and old debt
Considering we’re in the midst of a health crisis with economic repercussions, collecting unpaid balances and addressing debt will only become more difficult the longer we wait. Practices need to follow up on unpaid claims sooner rather than later and work out plans with patients that are fair and manageable.
Keep in mind that additional training may be necessary to ensure administrative and billing teams are up to speed. Physician practices may consider connecting with a third-party RCM vendor partner to address issues such as common billing errors, if they’re struggling to meet KPI goals.
While many of changes and challenges in RCM may be hard to adjust to and accept, the more work practices put in now, the greater the financial rewards will be in the third and fourth quarters of 2021.