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Looking at daily, weekly, and monthly revenue cycle reports doesn’t do much on its own, unless you compare them and track trends.
Many practices regularly review daily, weekly, or monthly reports to keep on top of billing and collections and highlight potential problem areas in the revenue cycle. But those reports aren’t very helpful unless you take the time to compare them and track trends over time, experts advise.
A single report on the percentage of accounts receivable (A/R) that are overdue by 90 days, for example, doesn’t say much on its own, notes Kenneth T. Hertz, principal in MGMA’s healthcare consulting group. However, looking at which accounts tend to stay in that bucket month after month helps you isolate a specific problem so you can initiate steps to fix it.
“In order for reports to be really relevant and used as a management tool to improve your revenue cycle, you’ve got to trend them,” says Hertz. “You’ve got to see what’s happening over time.”
Slicing and dicing your financials visually and categorically helps highlight trends, he says. It’s also critical to focus on a few key areas rather than trying to absorb hundreds of different reports.
Remember, running and analyzing reports is just busy work unless you can put the numbers into context and take steps to improve. Hertz offered the following tips:
1. Present numbers visually. Putting numbers into graphs, as opposed to charts or tables, clearly shows trends over time. That’s especially helpful in staff presentations when you are presenting financial information to providers and other staff.
2. Zero in on key trends. The creep in aging A/R is an important trend to monitor. Rather than just looking at A/R “buckets,” according to number of days unpaid, drill down to individual payers and find out why particular claims haven’t been paid. A/R monitoring is critical because the older an account gets the harder it is to collect on it.
3. Follow up. After drilling down into the 120-day A/R aging bucket, find out what’s holding up specific payments. If a claim was denied, what’s being done to fix the issues cited in the denial? Poor communication between the billing department and other parts of the office can perpetuate a cycle of denials. The billing staff can identify common issues associated with denials but fail to communicate that information to coders or providers.
4. Take action. Looking at reports should give you actionable information. A downward trend in A/R collections, for example, should trigger an investigation into your process for pursuing overdue patient and payer accounts.
5. Set a high bar. When it comes to setting goals, people have a tendency to focus on averages instead of looking at what the most successful practices are achieving. You should strive for a 100 percent success rate in collecting copays at the time of service, for example, even if the industry norm is closer to 80-85 percent. Setting high expectations also creates a culture of continuous improvement and underscores the importance of measuring and monitoring trends.