November 1: Five New Regulations to Watch for in 2018: CMS Reimbursement
November 8: The March Continues: Five Things I’m thinking about for 2018
November 16: Five Ways to Sink a Sub: What Wound Care Nurses Need to Know about Skin Substitutes in 2018
November 30: Despite The Controversy, HBOT Remains a Viable Treatment Modality: Five initiatives to watch for in 2018
December 13: Losing REMs over RCM? Here are Five Tips for Smoother Revenue Cycle Management in 2018
As the end-of-year countdown begins, we’re looking at changes that will impact the wound care industry in 2018. For the next several weeks, we’ll be running a series of insightful blog posts from our team of experts. This entry is from Kareem Aqleh, VP of Revenue Cycle.
Revenue Cycle is a fast-moving machine that requires continuous attention, and nowhere is this more apparent than in the wound center service line. The minute you turn away, your days in A/R are skyrocketing, denials are increasing, and payer payment trends are turning upside down. This is not a job for one person. Successful revenue cycle management requires strong leadership and a dedicated team focused on the execution of documented processes. For many hospitals and physicians, outsourcing is a viable option worth considering.
Here are five tips to help wound care programs improve revenue cycle management operations in 2018:
Collaborate vs. point fIngers. Cross-train Patient Financial Services (PFS) and Patient Access Services (PAS) teams. While working for a large central billing office, my denials team continuously voiced concerns that the PAS team wasn’t doing their job efficiently. Authorizations were not obtained, demographics were incorrect, there was no insurance information, etc. I knew instinctively that the best way for the denials analysts to understand the issues would be to sit in the PAS department for a short time, and vice versa. However, neither side could cease their job function. I reached out to the Corporate Director of PAS and presented the idea of cross-training.
From then on, every week, we had a staff member from PFS sit with a PAS team member, and vice versa. This was a worthwhile initiative because when PFS saw what PAS had to go through to obtain patient information and authorizations, they understood first-hand how difficult it was. The two teams began collaborating instead of pointing fingers, and the experience also opened up communication between them.
Develop strong relationships with managed care payers. It’s very important to create, harness and nurture relationships with major payers. They may seem like your enemy but, at the end of the day, they hold the money. If you treat them poorly, they will be reluctant to assist you in resolving issues.
A strong relationship will allow you to bypass the typical “go through provider relations” answer, and it shouldn’t be one-sided. There may be times when your contact needs help resolving overpayments and expediting refunds, for example. Solid relationships can be created and cultivated by making a commitment to scheduled monthly meetings and as-needed conference calls, and sticking to it.
Post Denials. One of the issues I’ve encountered working with a number of facilities is that they fail to post the reason for a claim denial. A payment of zero is posted, but no one knows why until someone reviews the explanation of benefits or remittance advice. Posting the denial reason provides you with an opportunity to run a denials report, which will identify internal issues and provide trending issues with specific payers. For example, let’s say you bill ABC insurance company a wound care claim and they deny it as “claim or service not covered by this payer.” You then identify that the same insurance company is denying the same service with the same adjustment code. Your investigation concludes when the services are capped to the medical group and you add an edit in your billing system to ensure the claim is billed to the appropriate payer.
Identify root causes. Don’t be tricked into believing that a denial is a root cause. A denial is the reason why the payer did not reimburse your facility for services rendered, but you need to ask yourself why the claim was denied. It’s not always the payer. In many cases, it’s the provider. Change Healthcare recently stated that the national denial average for front-end error is 23.9 percent.
In some cases, it’s not necessarily a denial that can impact A/R and require a root cause review. I’ve seen insurance companies underpay claims due to contract loading errors. This sometimes happens after a new agreement has been fully executed, and the impact can be costly. Claims are underpaid, creating a rework and mass appeal. The root cause is the lack of a workflow for new contracts within your contracts department. One solution may be to have the insurance company agree on a two-week window in holding claims, and then sending paper claims (certified) for expeditious processing.
Payer Contract Pitfalls. As previously mentioned, root causes are not always instantaneously identified through payer denials. One issue I’ve encountered in the world of wound care is a lack of reimbursement for skin substitutes. This could be a high-cost item that should be identified as an exclusion in your payer contracts. Industry standards have accepted skin substitutes falling under revenue code 636 which, by definition, is injectable pharmaceuticals. A standard contract will include a daily rate for wound care, however, facilities will fail to address the “exclusion.” Your contract should indicate a rate for revenue code 636 at cost+percent or a percentage of billed charges.
Based on the aforementioned tips, it can be overwhelming for a revenue cycle leader to provide direction to their team on where to focus their energy.
Wound care claims average less than $250 in reimbursement per visit, however, it’s important to note that the volume can be in excess of 400 visits a month (i.e., $100,000 per month), requiring attention from all areas of the revenue cycle. You do not want your team to take their focus away from high-dollar accounts, but you may find yourself lacking the personnel to focus on specialized outpatient services, including wound care.
Many CFOs believe that outsourcing accounts is taboo, or they believe it reflects a failure of their internal team to work account receivables in a timely fashion. This is absolutely not the case. A large A/R can be incredibly challenging to manage.
Don’t be afraid to outsource your wound care accounts to a trusted partner to assist in maximizing revenue. It’s not a failure to outsource—it’s a failure not to recognize when assistance is needed.
