Although medical practices have universally seen a drop in patient volume due to the COVID-19 pandemic, subpar revenue cycle management (RCM) has significantly exacerbated the issue. RCM efficiency is essential for a practice not only to stay afloat but also to flourish. Executive Vice President and head of MedEvolve’s revenue cycle, Matt Seefeld, offers a number of tips for practices to optimize their RCM.
According to Seefeld, practices must be certain that their patients have valid insurance and that any required referrals and authorizations have been met. Furthermore, practices should be proactive, settling any prior balances and making patient’s projected balances clear at the outset. Patients need a clear understanding upfront with regard to their financial obligations to the practice, and practices should not book subsequent appointments for patients until they have made good on all prior balances. Methods like dashboards and reminders are useful tools in this area.
One key issue is the rise in self-paying patients. According to MedEvolve, self-pay balances increased significantly in early 2021, from $1.5 million in September 2020 to $4 million in February 2021. The mean payment per visit is $18, with 77% of average revenue over 60 days accompanied by a 35% increase in patient debt. As such, it is essential that practices prioritize self-pay patient payments upfront.
Text and email are the most effective communication methods, according to Seefeld, so staff should be sure to collect cell phone and email information prior to a patient’s visit. He suggests tracking practice-patient interactions to determine effectiveness and decreasing reliance on paper statements, which are both expensive and not very effective at eliciting payments.
Real-time data insights (like Net Collection Rate and payments owed by insurance vs patient) are crucial to managing tighter margins and increasing revenue. Physicians should be aware of their accounts receivable (AR) liquidity, when to expect payments, and how staff is handling AR management. For instance, 80% to 90% of AR claims do not need to be addressed daily. Seefeld advocates for the use of advanced analytics tools that break down claims denials, overdue balances, partial payments, and unfiled claims. This yields potential new revenue opportunities, along with possible root causes that prevent revenue maximization. He also suggests using workflow automation to streamline revenue cycle efficiencies and rank workflows around the largest return on investment, thereby enabling physicians to always be able account for every cent in AR.
Seefeld also suggests that practices ensure the person assigned to handle office finances is indeed the best person for the job. Physicians need to observe their staff, noting strengths, weaknesses, and productivity. Regarding staff who need improvement, it may behoove physicians to provide additional training. Staff understanding of the various patient payment options like flexible payment options (phone, text, or online) and payment plans is another key element to optimizing staff communication with patients. If a patient prefers to be contacted via email, the practice should make sure to communicate via email (as opposed to calling or texting) with that patient. Not only will this lead to more payment collections, but it will also improve patient satisfaction. This will, in turn, boost employee accountability, confidence, and morale.