Problems Providers Ignore In Revenue Cycle Management (RCM)

Problems Providers Ignore In Revenue Cycle Management (RCM)

Medical Billing needs to be effectively managed and holds the most critical part of provider- reimbursement for the service. The need of an ultimate team of revenue manager is important – whether you go in for an in-house team of billers / coders or outsource team of billers / coder is one important factor for the providers. Before taking any further step in Revenue Cycle Management (RCM) you should first determine the problems you’re facing in the current medical services.

  1. Revenue Drivers

Revenue Cycle Management (RCM) is the bundled format of many steps from the first step when a patient makes an appointment to the last step of payer paying for the service. The initial steps of front desk booking, insurance verification, clinical care coding, charge capture. Further we have claim submission, payment processing and management of denied claims this is one important step that directly impacts the ability to get paid the full amount as quickly as possible for the providers.

The need of identifying some revenue driver is an important part for any provider. Revenue Drivers are dependent on the two factors internal and external. The internal factor is regards with the physician and patient care while the external factor holds the billing.  As a provider you can promote your practice with patient care and in turn turning your practice profitable.

  1. Getting Your Claims Billed

If you consider your revenue anything that comes even from patient out of pocket even including deductibles and co-pays as well as reimbursements covered under insurance payers. The claims reimbursement comprises of different actionable elements depending on the speed, and efficiency in which turning your claims towards cash. Effective claim management not only requires the understanding the how to negotiate in terms of the payer contracts.

  1. Tools for Your Revenue Management (Technology)

It’s isn’t fair to say that healthcare system is made in such a way that the providers and patients can benefit from it. The complexities of medical insurance and the way services are billed or collected are often counterproductive both for the providers and patients. This has further worked down the reimbursement of providers with tools to manage different aspects of claims.

The need of EHR is one factor that providers need to create time efficiencies, makes communication better and have live claim feedback. Medical providers are quite dependent on the technology to provide the patient care as it becomes imperative for the provider to communicate and track various the patients’ cares along with documenting the same for the medical billing.

To further reduce the errors of medical billing you need a team of expert billers and coders providing you with efficient revenue management. In turn creating a channel through which the denials can be reduced and the cash flow increase for the provider. Now, with (MBC) with over 16 years of experience and a team of expert revenue managers channelizing the total revenue management.

Posted in EMR / EHR / Health IT, Healthcare Reforms, HIPAA / ACA / ACO, ICD-10 Coding, Medical Billing, Medical Billing Company, Medical Billing Services, Medical Coding, Physicians/ Doctors, Practice Administration, Practice Management, Revenue Cycle Management (RCM), Why Outsource Medical Billing Services | Tagged , , , , , | Leave a comment

Relative Value Units (RVU): Independent Physicians Need To Know

Relative Value Units (RVU): Independent Physicians Need To Know

For managing finances, a computation of values or a formula is used in the United States Medicare for reimbursement of independent physicians. Known as Relative Value Units (RVUs), it was devised in 1988 to calculate the work rendered by physicians for treating patients. It differs chiefly from physician to physician in terms of services rendered; for e.g. the RVU of a patient visit will be lower than an invasive surgical procedure conducted on a patient. However, RVUs are useful in not just valuation of work/determining compensation but also to decide if a buyout offer from a hospital/clinic is worthy or not.

RVUs are decided by Medicare on a number of factors. It decides how much will each physician be reimbursed on the basis of services and procedures listed under the Physician Fee Schedule; and those that are assigned CPT code numbers (reviewed every five years). Further, each service is determined by the physicians work, his/her practice expenses and malpractice. Each of the three aspects is assigned a RVU.

How is RVU Calculated?

Physician’s Work (RVUw): This constituent takes into account the time (taken prior, during and after the service), training, technical skill, the stress or mental effort, judgment and intensity required to perform a service. This usually accounts for almost 50-53% of the total RVU where time is 70% and effort is 30%; also, a global fee comprises the predicted physician inputs used in the global period (from the day of the surgery to the follow up day).

Costs (RVUpe): This component takes into account the rent, office expenses, medical supplies and equipment, staff administration, administrative payroll and benefits, required to run the practice; almost 45% of the total RVU. Also, this differs for physicians performing the services in a facility as here the facility incurs the costs of equipment’s etc. Hence the physicians are given a ‘facility based’ practice expense RVU which is usually lower than the office-based practice expense for the same service. (For example, if a diagnostic colonoscopy is provided in the physician’s office, the physician’s payment would be based on a practice expense RVU of 6.78; if the procedure is performed in a facility, the payment would be based on a practice expense RVU of 1.94. –

Malpractice Expense (RVUmp): This liability varies (for e.g. it could be higher for obstetrics than a primary care physician).

These three factors are then multiplied by geographical adjustment – Geographic Price Cost Index (GPCI) which gives the cost for a particular location. This is then converted to a dollar amount by multiplying it with a conversion factor determining what Medicare or HMO has to pay for any service/procedure, and is location specific.

The Formula:

[(RVUw x work GPCI) + (RVUPE x PE GPCI) + (RVUMP x malpractice GPCI)] x CF for the year in question.

Why Were RVUs Created?

RVUs were created to bring about uniformity in the payment system and reduce the upward trend. Further, from a practice management perspective, RVUs were created as they are (the language) used by most payers for contracts and reimbursements. RVUs are also used to pay for multi-physician practices that can determine how much to pay physicians based on straight productivity (the practice multiplies the work RVUs with its conversion factor) and a salary plus bonus tied to a number of RVUs that have been generated over a base number (especially for adding productivity incentive) to arrive at the reimbursement number. It is also imperative that RVUs aid in recruiting and retaining physicians.

As RVUs are validated, they have gone to become the customary measurement for cost benchmarking. They are consistent, formula based, and the standard and acceptable norms for setting fee-for-service payments by Medicare and almost all other private insurance payers.

Posted in EMR / EHR / Health IT, Healthcare Reforms, HIPAA / ACA / ACO, ICD-10, ICD-10 Coding, ICD-10 Testing, Infographics, Medical Billing, Medical Billing Company, Medical Coding, Practice Administration, Practice Management, Revenue Cycle Management (RCM), Why Outsource Medical Billing Services | Tagged , , , , , , , , , | Leave a comment

4 Lessons your Account Receivable will teach you


Your Account Receivable (AR) is heart of your practice pumping the necessary life into your practice. The volume of AR and its age could be telling a lot about your practice. An analysis of your Account Receivable (AR) could be the next step towards your future growth- the introspect is one factor you need to touch for a successful practice management. In your practice one thing that holds the most important factor-Account Receivable (AR). Is that you get paid for what you deliver and the quality of care.

Below are some lessons to take from the Account Receivable (AR) along with Solutions :

  • Experiencing high delays

A Medicare usually reimburses the amount within two weeks of claim submission if the claim submitted is clean.  If you see a further delay of Account Receivable (AR) and the EOBs from the payers are having a same response this might be a red signal for you.

Start by the first step a demographic entry of patient, is your front desk capable handing through the process, the further steps of reimbursement takes through charge capture, coding and payment posting.

One of your resource point is either working with lots of stress which is furthering the errors or some of your things aren’t working in sync.

Solution: – The total workload of reimbursement process can be distributed. A team of expert billers and coders working in sync can reduce your denials but for this you need to make the some decisions to alter your current billing cycle- either hire a team of medical billers and coders where they just provide you with account receivable or train your staff for to reduce errors.

  •  Front Desk or admin responsibilities of engaging representatives from payers

One of the finest ways that the gap is bridged between a payer and provider is through an ease of sending a right message at right time to the payer. This will not only further reduce your load but also provide you with simple aspect about the payer requirement. Many of the insurance companies have a local representative which will cater to the needs and complaints of doctors. In case of discord between payer and provider the representative can act as a bridge.

Solution: – Your front desk or admin could share the above responsibilities with a payer. A direct communication line is the most simplest form that would affect your AR but it’s effective with payers.

  • Ignorant patient policies

Strict patient policies will have effect on provider account receivable and also channelize the account management efforts.  A financial survival today depends upon the policies you create for payment.

Solution: – Implement a non-excuse policy for your practice a 15 day demand letter and then it goes towards a collection agent. It is always better to take a patients credit card on paper before you start the diagnoses and treatment. This will help you during the payment period to find solution even if the provider does find a solution through co-pay.  Establish automatic payment policies that link to a credit card, checking account or debit card.

  • Need of technological upgrade

Your practice might need a upgrade in terms of technology if you miss patient data or are having to manual pass the data. Using current tools and patient reports will allow medical practices to discuss financial obligation without further notice.

Solution: – All the above solution can be planned with proper training of software for your staff. It’s important that you determine which would be the best technology catering your practice asks advice from other staff members, this might also open up a further avenues for your growth.

Solutions for all the above:-

All the above solutions for a provider can be inculcated into single medical billing package. A medical billing solution provider will reduce the stress of your service without affecting your practice.

“A medical billing company  will help in providing an end to end revenue management without affecting your practice. This will not only help you promote your service to patients but also keep the flow of account receivable smooth. The technological factor will be an easy step for you. The remote monitoring and easy access to your practices is the key for providers to flourish.” a physician turned medical operations manager Steve Johnson at (MBC).  To know more about need of AR solutions click here : or call us on 888-357-3226.

Posted in Medical Billing, Medical Coding, Practice Management, Revenue Cycle Management (RCM) | Tagged , , , , , | Leave a comment

Are Common Accounts Receivable Problems Plaguing your Practice Collections?


Are there predictable and constant errorwith your medical practice accounts receivable administration services that are confining your facilities income? If yes, then there’s no need to feel left out, as more than 40% active practitioners and their facilities in United States are facing the same issues, which is directly plaguing their revenue collection.

There are a couple of constant but common medical billing and coding errors that healthcare units suffer through, let’s take a look at them, and the remedy to resolve those core problems.

Denied Claims

A standout amongst the most well-known AR issues tormenting healthcare units is denied insurance claims. You’ve likely heard the expression, “If you have to ask, you can’t bear the cost of it.”

That is the way the medicinal services community should deal with claim denial. Benchmarking the data for various sources we found out that average denial rate ranges from 10% to 25% of all claims submitted. However, according to the MGMA the best performing groups should have a denial rate of only 4%.

Despite, AR and denied claim being an industry-wide problem, less than two-fifths of practices actually appeal denied claims. This presents a significant lost opportunity for recovering the revenue owed to your practice, hospital, ASC and clinic, which can be resolved by making simple corrections. Keep in mind that your accounts receivable or medical billing staff should review all claims prior to submission to ensure they meet payer guidelines, and follow up on all denials.

Needless Write-Offs

If we talk about write-offs, one should understand that some are necessary, while many are not. These are regularly identified with the primary issue we already shared: denied claims. Rather than automatically writing-off denials, your billing team should set aside time to review each one. Even a single correction can lead to a profitable reimbursement that your facility needs.

Here are a few points to follow when managing write-offs with precision:

  • Choosing which write-offs require managerial approval
  • Observing or Monitoring each claim overtime
  • Creating claim benchmarking and segregating them accordingly

How bad are the bad debts?

Patient duties now represents more than one fourth of the human services industry’s income, and rising bad debts is turning into an common or plaguing medical problem stagnating your AR.

It is no longer adequate to talk about patient responsibilities at the time of getting treatment. With a specific end goal to enhance patient collect, it is basic to start collecting it through the entire revenue cycle. Your in-house staff should be educated enough to start assembling all important billing and insurance data with a specific end goal to compute expected out-of-pocket costs and confirm the coverage, so that by the time of administrations the patient already understands and has agreed to their responsibility, and their insurance claim verifies what they already expect. Additionally, following up and staying up-to-date post treatment will heed to improve recovery and decrease bad debt.

Embrace a Culture of Collection

As a healthcare professional you enter the field with an end goal to serve the patients that come to you with certain physical disabilities or diagnostic problems. Therefore, it is normal for accounts receivables to be disregarded in favor of providing care or an exceptional patient experience. However, getting paid for services rendered is crucial for maintaining a successful and profitable practice and continuing to provide care.

In order to make AR a work priority, you as a physician need to embrace the culture of collection in your facility. Remember that aging and outstanding AR is the number one catalyst that eats up your profits. If the in-house charging department is falling short of completing the tasks, you always have the option of hiring a professional medical billing and coding organization that specialize in Accounts Receivable management services. With their expertise in appealing for denied claims and follow up practices your practice will surely benefit from their administrative services.

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Account Receivable (AR) – The need of multiple channels leading to reimbursement?


A medical staff consists of doctors to nurses and they are currently on a small raft which just holding all of them over water and any storm could destroy it. The reason for such grim situation is high rate of deductibles. As a physician I learned this hard way- initially we had a constant cash flow with respect to number of patients then with time overhead charges multiplied.

With over time we analyzed two factors which were affecting my Account Receivable (AR):-

  1. Payers (insurance) increased patient deductibles.
  2. Patients were frustrated with out-of-pocket cost in spite of paying the premiums.

The conversation with patient about money is most awkward topic for any physician and other part being is non-reliable insurance broker which is fueled by a confusing marketplace of insurance where patients are mostly unaware of any facts.  The high deductible health plan from insurance companies in which most of the patients are unaware is hitting the patient finance hard.

Due to high deductible patients are looking for alternate option

  1. Patients stop approaching primary care and look for quick fixes.
  2. Patients avoid seeing physicians regularly to reduce out-of-pocket cost.
  3. Emergency cases of patients ending up in critical care unit.

According to the recent survey we had conducted if a physician sees a patient and they are about to make $100. The insurance company will pay $75 and other part will be paid by patient as out-of pocket patient.

How to improve the deductible which needs to be collected?

If you are trying to improve your collection, getting your Account Receivable (AR) under control, or improving cash flow it’s not impossible. Let’s explain with an example a patient comes in for a level four visit, we see that the unmet deductible is $3500 and we know that for the service provided by the physician not 100 percent service will be covered. A Medicare amount allowable for a patient visit is $164. The actual payment will vary depending on the payer. The expected revenue will be $164 so a patient will have to go in for co-pay $25 will be paid by insurance and $139 will be paid by patient.

For an alternate route instead of asking for an entire amount the physicians will collect half of the insurance amount beforehand. This makes the total collection as $94; the patient will carry an internal cost of $70. You have now reduced your financial risk, from there on you agree to charge the patient 3 monthly payment for $23.3 with credit card on file.

When the patient’s pre-pays the amount it benefits the patient more; paying up front from helps them to follow through with your health plan. A multiple channels for reimbursement will help you achieve the required financial easiness without affecting the core practice.

Here are three steps you should implement to improve your practice:-

  1. Clarity in business decision making and financial policies to plan out the necessary step to include collection and deductibles.
  2. Hire a pre-coding team who will estimate the calculations before the actual patient walks-in.
  3. Communicate the cost of diagnoses and treatment beforehand and offer multiple options of payment for patients.

A medical billing company can palliate your practice advising you through different patient scenarios. This will not only reduce your AR stress but also create an end to end management for reimbursement cycle. A outsource medical billing company will sort out your pre-payment glitches and verification process. To know more about different channels for Account Receivable (AR) click here : or call us on: – 888-357-3226.

Posted in Accounts Receivables, Medical Billing, Medical Coding, Practice Management, Revenue Cycle Management (RCM) | Tagged , , , , , , | Leave a comment

How can Physicians improve AR days?


For you to improve the Account Receivable (AR) of your practice there are many different factors that come into consideration. Your quality of patient care is one such important factor which will contribute towards attracting more patients. To improve the patient care for your practice the things need to be systemized; we have to sync the work of an admin along with other patient care factors.

One of the easiest ways to achieve the complex goal setting of practice is to have a defined target and nothing can better than an Account Receivable (AR) of a practice?

A physician might say that yes I am seeing many patients but still my AR is low; one thing we ignore is the need of constant cash flow and collecting timely AR.

Physicians often come out on a short end especially when they are dealing with bigger insurance companies. Dealing with them requires a long length of time and skill.

Here are certain factors that would affect Account receivable days of physicians,

Aging of Claims: –

The first step that makes your AR clean is to determine the current status of payment for all of the AR. Create an AR aging report which will track your payment status. This will track or measure the number of AR days after the claim is submitted 0-30 days, 31-60 days, and 61-90 days. This can help you with tracking different potential collection problems and focus on the payment collection efficiently.

Claim submission: –

When submitting the claim it’s important that the claim is clean and complete with no missing information. While submitting a claim you should always look for small-denial-points that cause the insurance to deny the claims.  The silent nuances your claims generate will affect payment procedure.  For claim submission, you need proper channels which make it easy from the documentation, Charge entry, claim submission and AR.

AR strategy: –

AR strategy is one factor that will make your cash flow successive and channelized. At this point, you would need a team of callers or better to be said a team of AR callers come’s into the picture with friendly reminder call to insurance companies about AR due date. Your AR strategy should also include the keeping all your AR days below the threshold level of 90 days. This will help you maintain the status that all claims above 90 days will be put under daily check-status.

How (MBC) help you?

Now reading the above steps to improve your AR days would have cleared the picture for you that you need a team of experts who have handled medical billing before this and know how to reduce your AR days? Here comes a medical billing or collection agency which will provide you better control over your reimbursement. A collection agency will be a bridge between the payer and you. (MBC) a pioneering in practice collection with over 18 years under the belt we have structured many practices for growth. For more details go to our AR survey or call us on 888-357-3226.

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