Nine Tips to Optimize your Medical Billing and Collection Process

By Andrew Woughter, Senior Vice President Product Strategy | Posted: 08/29/2017

Health systems leave uncollected revenue on the table every day due to process errors in billing and collections – no surprise, since the process is arduous and complex. Requirement complexity is on the rise, new reimbursement models are introduced every year, and biller productivity is difficult to measure and manage. Billers and coders face big challenges and a growing number of denied claims.

Health care providers have the opportunity to appeal denied claims through the Medicare Recovery Audit Contractor (RAC) program introduced in 2010. The RAC program corrects Medicare payments on behalf of the Centers for Medicare and Medicaid (CMS) – both under- and overpayments. Auditors in the RAC program review payments and share their findings with health care providers, and they can appeal.

The program is showing positive results, as long as the health care provider knows the best methodology for overturning denials. In 2016, an AHA survey found that hospitals appealed 45% of RAC claim denials, and 60% of those denials were overturned in favor of the hospitals. Hospitals revealed that they spent between $10,000 and $100,000 each year managing the RAC denials process – a significant investment.

Here are the top nine ways to optimize your medical billing and collection process:

1. Identify:

Know the potential financial impact of your claims denials program.

2. Assess:

Put a stake in the ground and measure where your organization is right now – good or bad – in terms of denials rates. Measure current performance in coding accuracy and documentation areas; compare to your previous audit files to determine whether corrective actions have impacted results.

3. Examine:

Conduct an audit to ensure coding accuracy and compliance with current laws, rules and regulations.

4. Organize:

Plan how your organization will manage the entire RAC program and how you will reach your RAC goals. Initiating individual teams or procedures without a program plan could lead to redundancies, gaps or conflicts in your RAC program.

5. Train:

Once organized, assemble and educate a RAC team to manage research and response; (consider delegating tasks that are part of processes, such as pulling files from offsite locations, to vendors or temporary staff). Appoint internal RAC champions.

6. Collaborate:

A primary function of the RAC team is to team up with physician advisors and administrators to strategize and set procedures, and implement a communications infrastructure to ensure proper RAC communication throughout your organization.

7. Build processes:

Another function of the RAC team is to outline and build processes – or delegate to others – to gather documentation, develop tracking mechanisms, deliver requested records, review and respond to demand letters, track recoupments and refunds, and direct and track appeals.

8. Automate:

Manual processes are not sufficient for addressing RAC needs. Implementing an automated RAC tracking solution that ensures only valid claims are audited, provides a mechanism for escalating deadline reminders, develops tracking mechanisms, facilitates departmental communication, identifies systemic trends and weaknesses, manages appeals and allows for capturing and monitoring data that can be shared.

9. Monitor and Measure:

Assessing progress and outcomes is critical to identifying areas of risk and opportunities for improvement. Aggregate date and measure by service, denial reason, DRG, coder, dollars recouped, dollars refunded, state of appeal and total financial impact to organization.

How much does your organization stand to gain from a strong RAC program? Click here to see the Cost to Collect.