Despite the return of elective procedures at most hospitals and outpatient centers, not nearly enough patients have been showing up, perhaps fearful of what they perceive as high-risk environments. As a result, healthcare’s COVID-19-fed economic downturn has reached epidemic proportions, leaving organizations of all types and sizes scrambling to identify any new or accelerated sources of revenue.
Instead of mass layoffs or furloughs, some forward-looking health systems are seeking cash-yielding solutions that are non-disruptive to current operations. They are looking beyond COVID-19’s impact for lasting positive effects on cash and efficiency. Here are four tactical and strategic priorities that should be pursued simultaneously right now:
- Take advantage of the opening presented by the dramatic and sudden reductions in volumes and shifts in account mix due to the COVID-19 crisis to design and implement a new business office operating model that effectively “future-proofs” cash
- Use reviews of past and prospective payments analysis to discover and recover significant new cash
- Take the low-risk approach of choosing projects completely unaffected by the crisis so staff can stay focused on their own related urgencies
- Short-list only those vendor partners who will perform the work completely at-risk and with no upfront fees
These are not mutually exclusive objectives. And now is the perfect time to address all four in a single project with a single, at-risk vendor partner.
When zero means quick cash
At a time when many institutions are in the midst of a severe revenue downturn, seeing a cash recovery of $110,000 in the first month, and more than $727,000 in just over three months, as a 450-bed hospital client of ours did recently, or $4.8 million in four months, as a large Midwest hospital received, is much needed good news.
This process, known as zero-balance reviews, involves both a retrospective and prospectively modeled look at paid and/or written-off claims. These reviews of closed accounts use a process of reimbursement analysis followed by the grouping and analyzing of like claims to find out why some are underpaid and where there may be significant trends that convert to large sums of recovered cash immediately. As importantly, it identifies the underlying issue(s) and corrective actions to take. As a result, tens of millions of dollars in future revenues have been protected from leaking away into a river of red ink.
Zero balance reviews will pay even larger dividends when normal volumes return. Much revenue leakage is caused by providers failing to code and bill according to payer rules; analysis of payment to charges catches accounts paid properly per payer contracts but underpaid as they were coded incorrectly.
Automating denial management
If you are a health system with a robust denial management system, many of your claims look right. If you are a health system with a robust reimbursement analysis program, many of your claims will be paid according to how they were billed. Working with a partner with an effective coding team and an AR team that understands the payer market across the spectrum will show you why and how those claims were underpaid. Working with a partner that can also detect errors across the full spectrum of your revenue cycle operation will show you why and how to lift performance across the board front-to-back.
Using advanced automation in the review process means that thousands of claims can be reviewed instead of a few dozen per day through manual processes, which removes the only viable objection to zero balance reviews – that they involve many small balances not seen as worth a lookback by staff straining to handle new claims.
Salud isn’t the only vendor out there that does this work, but we have turned it into a tech-enabled specialty. Our process includes:
- Contract modeling, automated claims status reports, and historical 835 electronic payment explanation data to find zero balance accounts with recovery opportunities
- SaludSynapse, our business intelligence platform, provides rules-driven workflow that streamlines the appeals process and maximizes results
- Sophisticated analytical reimbursement models are built specifically for all the national payers and tuned smartly to each state’s payer rules and tendencies
Audits find root causes of underpayment
Salud expands the net by finding underpayments as a result of many other breaks in the process like coding, billing, and as a result of analysis of percent of charges ratios. Other solutions also do not have our technology-enabled workflow, intricate knowledge of national and local payer practices, or our data mining and analysis tools.
The fact that zero balance reviews are non-disruptive even amid the pandemic is a huge bonus. They are unaffected by the huge shift in AR to non-elective procedures due to massive procedure cancellations as well as labor shifts and reductions in business office staff or coding.
Regular audits of the business office through this program provides well-articulated root causes of underpayment. Processes and systems are calibrated to address the inevitable challenges brought by the interdependencies and continually evolving roles of business office people, process and technology, thus protecting future revenue streams.
The time to deliver cash for current operations is now, with an even bigger payoff to come.