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Healthcare Quality Metrics

          HQM Consulting

 

 

A robust revenue cycle program should focus on key components. Streamline your organizations revenue cycle management to include : Denials Management, Discharged and not final billed (DNFB), and Uncompensated Care.

Denials - Benchmark Denials adjustment rate: 1%

Denial adjustment rate(final denials as a percentage NPSR)

Strategies:

  • Establish an enterprise-wide denials management and prevention program 

  • Review and analyze denials and underpayments to determine root causes

  • Create best practices to prevent future denials

  • Inspect the entire revenue cycle − beginning at scheduling and registration − to find leakage issues, such as bad information gathering

  • Consider a denials management improvement project that includes a redesign of denial codes, improved reporting and analytics, enhanced prevention efforts and additional training.

At the end of the day, the medical record needs to be complete and accurate upon discharge.

DNFB management:

  • Accounts within suspense (also known as the bill hold) is a facility-defined number of days in which an account will be held from billing so charges can be entered after the patient is discharged from the hospital. Any charges added after the suspense period, which typically ranges from 3-5 days, are considered late.

  • Accounts outside of suspense and not coded - charts awaiting coding before bill drop.

  • Accounts outside of suspense and not billed - charts that have been coded but are being held by billing until issues are resolved (e.g., awaiting late charges)

Uncompensated care is measurement of hospital care provided for which no payment was received from either the patient or insurer. The uncompensated care is the sum of a hospital's bad debt and the financial assistance it provides. Financial assistance includes care provided that was never expected to be reimbursed or care provided at a reduced cost.  The Uncompensated care is excluded from unfunded costs of care, such as underpayment from Medicaid and Medicare.

Uncompensated Care Charges = Bad Debt Charges + Financial Assistance Charges

  • Cost-to-Charge Ratio = Total Expenses Exclusive of Bad Debt Gross Patient Revenue + Other Operating Revenue

  • Uncompensated Care Costs = Uncompensated Care Charges x Cost-to-Charge Ratio 

Source: Health Forum, AHA Annual Survey Data, 1990-2016

Implement a multi-pronged approach, employee root cause analytics to target at risk population to assess  and see what sort of state, federal or local funding those individuals could receive. 
 

The concept is simple - the patient receives services, charges are entered, the record is coded and billed. The execution is complicated and the process can hit a number of hiccups before the bill gets out the door.

To achieve revenue cycle goals for the organization, active engagement with a C-Suite Stakeholder is imperative. 

The key to any successful program is the team. What is your RCM Team's Strengths and Weaknesses?  Would your organization consider supplemental staffing to achieve goals sooner?

 

There is tremendous opportunity to improve your revenue cycle processes.

What are the first steps to improving RCM?

Contact HQM's team to schedule an initial audit & assessment. Data collected will assist HQM's team make the appropriate recommendations to strategize best practice solutions.

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