Medical practices have a vested interest in protecting—and growing—their revenue, especially as patient payment responsibility increase. The seemingly straightforward task of collecting patient payments can, in reality, be an arduous and complicated ordeal if the right front- and back-end systems aren’t in place. Observing and analyzing key performance indicators (KPIs) can help your practice measure performance from every angle, so you can identify where there are issues in your processes. Then, you can take targeted action to correct them—and boost your revenue.
Here are five ways KPIs can help identify revenue opportunities across every workflow inside your practice as well as tips for finding useful data that might be hiding in your practice management (PM), revenue cycle management (RCM), and electronic health record (EHR) systems. We’ll also share our favorite metrics for monitoring key growth indicators and moving the needle across all areas of the practice.
Verify eligibility and prior authorizations
To increase the revenue you collect from patients, your front desk staff needs to verify the eligibility of every single patient for every appointment. In addition, staff should confirm how much of a patient's deductible has been met, so they know how much to collect.
Technology makes it much easier to collect prior balances and take prepayments, set up payment plans, and identify patient eligibility information upfront. For example, Advanced Urology Institute has implemented kiosks and iPads for patient self-service, freeing up staff to spend time verifying eligibility and securing prior authorizations.
If the payer requires authorization and the authorization is not obtained, the claim will be denied. Consequently, your practice won’t be able to collect that money. To ensure this KPI is being met, look at your denial codes to see what percentage of your denials are due to a lack of authorization. Find them, fix them and, more importantly, change the behavior causing them. Eventually, you will have zero denials because of authorization absences.
Analyze cancellation rate
Another KPI you can use to increase your practice revenue from the front end is to review your cancellation rate. A high cancellation rate leads to decreased productivity, so it’s a good idea to get familiar with what percentage of your appointments are canceled and, more importantly, why they’re being canceled. Was it because the patient isn’t satisfied? Was the appointment not needed after all? Did the provider cancel the appointment because of last-minute changes? Make sure you assign the appropriate cancellation reason for every visit, so you can identify trends that are causing decreased productivity and lost revenue.
Once identified, you can analyze what the reasons for cancellations and hone in on what behavior modification can decrease them. If you have a high cancellation rate, make sure your practice is utilizing a wait-list functionality. Make sure to give patients the option to reschedule appointments electronically themselves so they don’t have to worry about calling during standard business hours.
Reduce bill lag
On the back end, bill lag can indicate unbilled charges and lead to higher accounts receivable (AR). A bill lag is the length of time between when the claim is submitted compared to the date of service. A practice should strive to bill all services within one or two days from the date of service. To check this, look at your billed date compared to the date of service to determine your bill lag. Charge lag is also an indication that it is taking your practice longer to enter charges.
If you have unbilled encounters, your charges are not being entered into the system in a timely manner. To find these, look at any appointments with have no charges entered. You can determine your charge lag by running a report after all encounters are fulfilled and compare the charge entered date to the date of service. Charge lag should ideally be zero, meaning charges entered are billed same day but no more than two days from the date of service.