Marvin Luz

The coronavirus pandemic has stretched practices to their limit, with increased patient demand and extra precautions putting even more strain on busy providers and their staff. While the primary focus remains on keeping patients healthy and safe, today’s providers are continually challenged with attending to the business side of their practice, too.

For many practices, improving their billing and collections procedures, and ensuring they get paid properly for their services, has remained top of mind this year, particularly as the industry evolves to value-based care. But credentialing–one of the fundamental aspects of revenue cycle management (RCM)–is often overlooked. If practices and providers are not credentialed by government and private payers, or they neglect to renew their credentials, RCM is stopped in its tracks. Without credentials, they cannot legally bill patients for services or collect revenue. It can take months to recover that revenue stream, with a very real risk of losing substantial income in the process.

RCM Credentialing: A Labor- and Time-Consuming Process

Credentialing—or the process of contracting with insurance companies and obtaining hospital and facility privileges–can take anywhere from 90 to 120 days; COVID-19 is putting more pressure on the process. Due to the pandemic, healthcare organizations have had to rapidly scale their provider networks to handle spikes in demand—but until they’re credentialed, those providers cannot start treating patients or submitting claims.

Most practices typically do not dedicate sufficient staff to this complex legal and regulatory process. The work required to manage this is considerable: each individual provider may need credentials for 25 or more payers, each of which has different requirements and renewal schedules. What’s worse, many practices may not even realize there’s a problem until denials come pouring in. Certain Remittance Advice Remark Codes (RARCs) and Claim Adjustment Reason Codes (CARCs) 

can signal that there are credentialing issues

. Then, it’s up to the staff to dig deeper with each payer to see if it’s a simple problem, such as an error in the provider’s identification code, or worse—lapsed or no credentials—and try to fix it quickly so claims can be approved and payments can be made.

Maintaining Key Performance Indicators for RCM

Lack of credentialing not only adds work for the staff, but it also negatively impacts practice key performance indicators (KPIs), such as:

 – The goal for time from submission to closing of a claim should be thirty days. But without proper credentials, this time can increase significantly. It could take up to 21 days just to get notification of claim denial, and during this time that provider could have seen hundreds more patients insured by this payer, whose claims will also be denied. Not only will it take more time to fix the denial, but several months could also pass before the provider is properly credentialed, resulting in the need to write off all the claims in question.

 – Ideally, practices will want to ensure at least 75% of all claims are completed within 60 days. Trying to correct credentialing issues can take much longer, with claims continuing to age during that time. By identifying credentialing issues early, and ensuring that renewal timeframes are met, practices can keep their claim aging KPI in check.

 – The goal of every practice should be to obtain reimbursement upon the first claim submission, since denied claims mean no revenue. Claims denied for credentialing are not clean. Ideally a practice strives to maintain a 90% or higher clean claim rate. But consider if your practice has credentialing issues with a major payer -- a significant number of claims will lead to additional work simply because credentialing was not up to date.

Staying Ahead of the Credentialing Process

Taking a proactive approach to credentialing is vital to the fiscal health of your practice, whether it’s reviewing new providers who were added to help with pandemic-related demand, or ensuring existing providers are still eligible to be reimbursed for the services they provide.

For new providers, make sure to take the appropriate steps to get them credentialed, which includes collecting information about contracting with desired government and private payer insurance companies and obtaining national provider identifier (NPI) numbers for the practice and clinicians. When the applications are completed, review the terms and rates of the contract, and negotiate any objectionable conditions.

Once they have been credentialed, it’s up to both the provider and your practice to ensure there are no lapses. Reminders should be set, using Outlook, Office 365 or other calendaring apps to complete recredentialing or revalidation in a timely manner. Most insurance companies will require these updates every few years. They can be very strict, not allowing for retroactive reauthorization, which could put claims at risk of non-payment.

Manage Cash-Handling at Your Medical Practice

Outsourcing Can Keep Credentialing on Track

Given the complexity and time demands associated with credentialing and managing claims, many small practices do not have the staff to keep up. In these cases, outsourcing these efforts to a third-party vendor can alleviate much of the burden.

These vendors can provide a variety of services from software to track the credentialing process to a holistic offering that includes helping practices obtain and maintain credentialing for all providers. Working with a third party that has expertise in the credentialing process can save significant time—condensing the process from 90 days to as few as 15. And it can save your practice money by having staff ready to handle the paperwork and claims denials, and ensuring that revenue streams continue uninterrupted.

In times like today’s global health crisis, it’s vital to ensure that providers’ credentials are up to date so they can continue providing the best care available to patients while maintaining the viability of the practice.

, a leading health information technology and services provider, 

 serves as senior director, Greenway Revenue Services. With more than 13 years of experience in the ambulatory EHR and practice management market, he oversees the daily billing operations of revenue services for customers, ensuring compliance with divisional established policies and protocols, adherence to government and insurance payer policies and assurance of customer conflict resolution. In addition to his daily responsibilities, he also leads the Patient Call Center and Patient Accounts Receivable teams at Greenway. 

Articles

Taking a proactive approach to credentialing is vital to the fiscal health of your practice. 

Best Practices for Optimizing Revenue Cycle Management: Why credentialing matters

As a result of the COVID-19 pandemic, the American Hospital Association (AHA) estimates that 

hospitals and health systems have lost more than $202 billion

 from a drop in revenue, combined with COVID-19 expenses, during the four-month period from March to June 2020. 

Healthcare services expenditures also dropped 38%

 in April 2020, as compared to the previous year, and many practices are now contending more with patients who are unemployed or uninsured and unable to pay for doctor visits, specialty care and routine procedures. These numbers will undoubtedly rise, as 

nearly 27 million Americans could potentially become uninsured

Adjusting to new ways of operating during COVID-19 -- and maintaining the revenue cycle all the while – is critical as the industry continues to navigate uncertainties about reimbursement for virtual care and increasing numbers of patients losing their jobs.

Five Tips for Improving RCM in a Post-Pandemic World

With growing expenses and lower revenue, healthcare providers can no longer afford to wait weeks for payments to be processed or face extended reimbursement times because of denials and incorrect coding. Practices must put a stronger focus on revenue cycle management (RCM) in order to remain a viable business, reduce the risk of having to cut back on staff or practice hours, and continue delivering the services their patients expect.

 serves as senior director, Greenway Revenue Services. With more than 13 years of experience in the ambulatory EHR and practice management market, he oversees the daily billing operations of revenue services for customers, ensuring compliance with divisional established policies and protocols, adherence to government and insurance payer policies and assurance of customer conflict resolution. In addition to his daily responsibilities, he also leads the Patient Call Center and Patient Accounts Receivable teams at Greenway.

Five tips for improving RCM in a post-pandemic world

Recovering from COVID-19: How practices can maintain the revenue cycle in 2021

With a busy staff and full schedule of patients each day, it may appear as if your practice is thriving. But take a closer look at some of its vital signs - net collections, accounts receivable (A/R), write-offs and other revenue trends - and you may realize your practice suffers from conditions that could threaten its longevity.

It’s challenging to transition your practice from a fee-for-service model to value-based care while also striving to stay financially healthy. This is especially true when you’re contending with a strict and ever-changing regulatory environment in which high-deductible health plans and complex payer fee schedules are increasingly the norm.

To ensure your practice is financially strong, it’s important to gain a deeper understanding about how to get paid for specific services, which key performance indicators (KPIs) are most important to track over time and how to make necessary improvements or adjustments.

In today’s evolving healthcare market, it’s more important than ever to ensure your practice receives every penny it’s owed. As a starting point, track financial performance metrics such as net collections ratio, days in A/R, claims older than 60 days, clean claims ratio and revenue change year-over-year.

While these numbers may look good on the surface, dig deeper to see if your practice is missing additional hidden revenue opportunities. For example, 28 percent of providers don’t know the amount of patient collections they write off each year, according to 

. Without greater visibility into details like this, providers likely don’t know what is causing the write-off, or if changes could be made to reduce those losses - while also increasing revenue.

Here are five key metrics that can shed light on your practice’s financial health:

This measures the effectiveness in collecting reimbursement dollars. However, this metric is not relevant unless two months have passed since the reporting period, as this feeds providers with a clearer picture of collections after the claim cycle. Net collections can be impacted by high deductibles that increase patient liability, procedures that are not covered, incorrect posting processes or unworked A/R. Practices must know the difference between gross and net collections and assure that all adjustments were made correctly.
	 

This is the amount of money collected per encounter. Average collections per visit is an excellent way to examine year-over-year trends within your practice. Like net collections, average collections are influenced by increased patient liabilities and unworked A/R as well as changes in payer contracts and procedure and payer mixes. Practices should also consider tracking charges per visit to help identify and remediate any coding inconsistencies.
	 

This represents the average number of days it takes for your practice to be reimbursed. Rejections and/or denials, incorrect coding, credentialing issues and incorrect posting and appeals processes can stretch out the time it takes to be paid. Practices should break out days in A/R by insurance plan and patient so they can get a better sense of where problems exist, such as consistent coding errors, that they can address to speed up payment time. Any A/R that has surpassed 365 days from date of service should be considered for potential write-off.
	

These are wholly preventable and can be remedied with a change in process, policy or behavior. Problems that lead to these unexpected denials include inconsistent benefits and eligibility verification, lack of review of medical policy changes, incorrect coding processes and inconsistent maintenance of system tables. It’s possible to recoup some of this money, but resubmitting denied claims comes at a cost - and that takes away from the bottom line. The 

Medical Group Management Association (MGMA)

 estimates that it costs a practice an average of $25 for 

each denial that must be reworked and resubmitted

. Overall, industry standards indicate unexpected denials should comprise less than 5 percent of total denials.
	 

This is the number of days between date of service and claim submission. The posting lag can vary because of provider coding processes or whether the patient is there for an office visit or a procedure. Practices should strive to reduce the lag to less than five days for office-based services and 12 days for combined hospital and office-based services.

Once you recognize the symptoms that could negatively impact your practice, it’s time to take action to improve your practice’s financial health. Consider areas where your practice can optimize systems and operations.

Improve training and apply best practices to eliminate recurring billing, coding or submission issues. Similarly, examine denial trends and discover ways to address the most common problems.

For example, to improve net collections, adopt best practices aimed at streamlining the charge entry process, which includes: 1) eligibility and referral management functionality; 2) tips and tricks for patient payment posting; and 3) how to upload documents into the EHR. By optimizing billing tables and updating fee schedules, you can ensure payments to your practice are accurate. It also helps to have staff work on denials every day to avoid timely filing delays and untimely appeals.

If days in A/R is a concern, practices can examine denial codes to see if there are common reasons why claims are being rejected. That way, staff can take appropriate actions to mitigate these issues in the future. Training front desk staff on eligibility requirements and having them run patient eligibility prior to the date of service will cut down on denials later in the process.

Another valuable tool is a monthly reporting package, which practice managers and owners can review to see where the practice stands in terms of current days in A/R, aging percentage, clean claims rate, service analysis and other KPIs. These reports can help identify opportunities for improvement across departments.

To address potential missed revenue opportunities, avoid general adjustments, write-offs or under-coding office visits. For example, one practice noticed that a new specialist’s top 

billed procedure was being written off as a non-covered service

. Upon reviewing this with providers, the practice was able to establish a new diagnosis code that better supported the procedure and ensured claims were paid.

Performance metrics are vital, but they are only the first step on the journey to healthy financial performance. Once you interpret and understand these KPIs, you can dig deeper and discover which workflows and processes may impact your practice’s performance. Then you can identify where to plug revenue leaks. All of these steps will ensure a better bottom line and ultimately smooth sailing.

Marvin Luz is a senior director of revenue services for 

, a leading health information technology and services provider. Marvin oversees the daily billing operations of revenue services for customers, ensures compliance with divisional established policies and protocols, adheres to government and insurance payer policies and assures customer conflict are resolved. In addition to his daily responsibilities, he also leads the patient call center and patient accounts receivable teams at Greenway. Martin has more than 13 years of experience in the ambulatory EHR and practice management market.

Diagnose key metrics that can help you track financial issues in your medical practice- and improve profits - before it’s too late.