The promise of the new year lies ahead. One way to help ensure that it will be a profitable one is to re-evaluate your company’s pricing strategy. We recommend devising an approach that...Read more »
3 Age Old Problems Solved in One Afternoon at the Movies
I took my kids to see the new Star Wars movie over the holiday, and it was an amazing experience. Not because I finally got to see how Han Solo made the Kessel Run in less than 12 parsecs. Not because I now understand why Han shot first. No, the part of this experience that was amazing was using my newly downloaded app for taking in-movie bathroom breaks. I won’t tell you the name of the app but suffice it to say it offers a solution to the lack of a pause button during live entertainment. And let’s face it, it may not have the gravity of North Korea, but that problem has dogged mankind back to the Roman Coliseum.
This experience brought to mind the awesome ways we can leverage IT solutions to solve long-standing business dilemmas. Two of my recent clients have been wrestling with a problem that frustrates and confounds nearly all accounting departments in the Healthcare industry. Namely, how to fix/improve/streamline their broken revenue cycle. The HFMA defines the revenue cycle as “All administrative and clinical functions that contribute to the capture, management, and collection of patient service revenue.” In a nutshell, revenue cycle covers the entire transactional life from creating the patient account to final payment. And for most organizations in the healthcare industry it is fundamentally broken. Just a few of the issues I see over and over:
Broken Billing Function: Whether your billing private third party payers or Medicaid or some local jurisdiction, schedules of what can be billed for certain procedures change. Required billing data can vary greatly from payor to payor. When a bill is denied or short-paid, the resources expended (time, effort, and money) to fix the problem can break an organization.
Weak Pre-admission Process: I once made the mistake of separating the accounting part of the revenue cycle from patient intake. I assumed one was administrative and the other was operational. But they have a symbiotic relationship and the fastest way to boost cash flow is making extra effort to contact patients and prep the revenue cycle before they arrive for appointments. Things like Medicaid eligibility can be checked through clearinghouses. Establishing expectations for who pays what. Capturing the correct billing data. All of this can be enhanced by strengthening the pre-admission process.
Poor Training: Even if your work flow design is top shelf, an untrained employee can do a lot to disrupt efficiency and effectiveness. In the healthcare space, a checklist should never be optional. Even better, an electronic check-in process that can transparently absorb a checklist and guide both patient and employee through mandatory tasks (insurance card copies, co-payments, etc.) is a great way to leverage an IT solution. A claim status dashboard can be used by the person managing the revenue cycle to measure cash flow. There is no shortage of options.
The list goes on and on. There are so many choices when it comes to addressing the revenue cycle and implementing a possible solution can be vexing. I’ve done a number of them and each had their own challenges. That said, in the end, the pain of getting a new payment portal in service or RCM software up and running is temporary and far exceeded by its benefits.
Russ Gambrel is a Director on our Finance & Advisory team. He is a CPA and Controller with more than 18 years of accounting, auditing, banking, financial, and project management expertise. At Fahrenheit, he serves as interim CFO and controller, implementing internal controls, working on system implementations, providing analytics and delivering process improvements. To contact Russ, click here.