Of the nearly $1 trillion in wasted healthcare spending each year, $210 billion is due to excessive administrative costs related to payer-provider interaction . An additional $170 billion is attributed to managing inaccurate payments. According to the American Hospital Association, Medicare and Medicaid underpaid US hospitals by nearly $77 billion in 2017 . In a time when provider revenue is taking a hit from increasing patient pay responsibility, achieving timely, accurate payer reimbursements is more critical—and more complex—than ever.
For many hospitals and physician practices, the answer is outsourcing all or parts of the revenue cycle management process. Following is a list of revenue cycle processes that can benefit by outsourcing, along with capabilities you should look for when choosing an outsourcer.
Registration and patient access. The majority of denials are caused by errors in the patient access process. This includes inaccurate patient information, often caused by data entry errors. Missing information is also an issue, especially around insurance coverage. The best outsourcers are those that use automation technology to streamline these processes and improve their accuracy. Outsourcers generally will have direct connectivity to more payers, which provides them with more accurate and up-to-date coverage information. They can attain the information faster than the provider’s staff who are often relegated to phoning payers for information or searching payer websites. Faster, more accurate information on the front side means fewer denials and faster reimbursement on the backside.
Claims submission. Data entry errors are also a significant reason that claims are rejected. While some errors may be typos, it’s more likely they’re due to incorrect coding. But keeping staff updated on codes is challenging due to time and resource constraints. By outsourcing claims submission to experts, providers can use staff for more impactful tasks such as direct patient care. And just as with patient access, the best outsourcers will use automation software to ensure claims are submitted without errors. Such software flags potential issues so they can be quickly fixed and resent before hitting the payer’s adjudication system. It’s crucial to choose outsourcers that use certified coding specialists, meaning they’re continually educated on coding changes. This, too, will ensure claims are submitted accurately. And claims that are accepted upon first submission get paid faster.
Timely filing. Missing payer submission deadlines is another frequent reason claims are denied, and they’re one of the most difficult to appeal. It can be challenging to stay on top of payer requirements for documentation, medical necessity, and prior authorization. Many times provider staff are faced with a backlog of such requests. But that’s not so for outsourcers who have more direct payer connections and more expert resources, which allows them to stay more up to date with each payer’s unique requirements.
Denied claims. Preventing denials is one of the top opportunities for improving revenue, increasing cash flow, and reducing bad debt write-offs. Most denials can be prevented by improvements in the previously mentioned patient access, claims submission, and timely filing processes. But payers are getting more sophisticated in using technology to identify potential denials. While this can be a headache for providers, it’s not for the right outsourcers. When denials do occur, outsourcers have equally sophisticated technology that provides more comprehensive claim status and remittance information, which allows them to work by exception. More informed appeals lead to higher appeal acceptance rates and faster reimbursement.
Payer management. This is an area many hospitals and provider practices fall short, and it’s completely understandable. Staying on top of dozens, or even hundreds, of payers is challenging, and to do it right requires dedicated resources and payer management expertise. When payer contracts are ignored, providers can experience higher denials, contract rates that don’t match industry standards, lower appeal acceptance rates, and greater diversion from SLAs. While many outsourcers may say they can manage your payers for you, the highest performing outsourcers will be those that have experience with thousands of payers. It’s only with this level of expertise that outsourcers can effectively drive payer accountability. The best outsourcers should also be able to perform contract negotiation, adjudication, and continuous SLA monitoring.
Patient financial experience. It’s estimated that up to 35% of provider revenue now comes directly from patients . Yet providers have done little to update their collection processes to reflect this new reality. A well-design collections program is one that makes it easier for patients to pay. This means proactively offering payment plans based on each patient’s unique financial situation, giving them the ability to add additional charges over time, and providing multiple options for paying. Developing and implementing such a comprehensive, patient-centric collections program takes time and a level of expertise many providers simply do not have. Outsourcing to payment and collection experts can remove this burden and deliver results more quickly.
A faster return on investment
Partnering with the right outsourcer can help providers get paid faster, more accurately, and with less hassle while improving the patient financial experience. Sunbelt Health has 30 years of experience managing claims and collections for several of the largest healthcare systems in the US and abroad. Sunbelt’s outsourcing expertise includes patient access, claims management, denial processing, self-pay collections, and payer management. Providers who partner with Sunbelt see a positive return on their investment, increased collections, and improved long-term viability.