Revenue Cycle: Solving Your Core Home Care & Hospice Challenges
At one point or another, every home care and hospice organization will benefit from a review of its revenue cycle to identify and address any common concerns that may threaten financial performance and viability. According to Ron Barrera
, Director, Simione Healthcare Consultants, opportunities exist at each stage of the revenue cycle to generate faster, more accurate payments for the services provided.
"Revenue Cycle Management (RCM) begins with the patient's entry into the care system-- from insurance verification and eligibility of benefits to documentation of the face-to-face encounter and MD orders, and from the admission visit and start of care to the charge entry, billing, follow-up and denial management. These activities all occur before an organization is paid," Barrera says.
"With so many steps and requirements along that process, it's no wonder that many home health and hospice agencies experience setbacks that increase Days Sales Outstanding (DSO), decrease cash flow, delay coding and billing activities, and/or result in payment delays or denials. Several important exercises will help to address these issues to improve cash flow, support staff and improve overall performance," he explains.
Initially, Barrera suggests that improving cash flow beyond an accelerated billing and collections effort requires that home care and hospice agencies pay their bills on time, negotiate longer payment terms with vendors, and understand their receivables. From that point, agencies need to examine their revenue cycle framework.
Admissions, Face-to-Face and MD Orders
During the intake and admission process, accuracy of information by intake staff is paramount, including the correct spelling of names, social security or Medicare HIC number, and payer assignment. For eligibility, the payer and benefits must be verified, and authorization obtained and entered correctly into the system, with specific documentation on contract terms to identify patients with payment ability. Verification of this information by the clinician at the start of care admission visit is critical to ensuring accurate information from the start of the revenue cycle.
With face-to-face and MD orders, the process must be clear with responsibilities identified and monitoring in place to document the appropriate information. Additional documentation factors include OASIS assessment to reflect the patient's status, coding accuracy, information that supports the need for services, the right disciplines for the right services and number of visits, and clinical notes that support the Plan of Care.
Charge Entry, Follow-up and Denial Management
Charge entry is another important aspect of the revenue cycle, inclusive of missed visits, billable vs. non-billable activities, batch processing, correct charges recorded for each payer, and medical supply charges.
During billing, the goal is to process claims effectively and efficiently, taking into consideration manual vs. electronic processes, days to Request for Anticipated Payment (RAP) and final claim, frequency of billing, the availability of key billing information to staff, any backlogs in billing, and potential risks for inappropriate billing.
The follow-up process also serves a key role for ensuring quality checks on whether expected payments are received, the speed of response to rejections, analysis of the reasons for rejections, and proper workflow for resolution.
Denial management requires a process to identify, manage and track denials for payment, which needs to be assigned to the appropriate staff who can determine the reasons for rejection to improve the revenue cycle process.
When evaluating receivables, Barrera suggests determining how much cash is collected by payer, verifying that contractual allowances are recorded correctly and analyzed by type, and considering credit balances, secondary payers, and balancing cash receipts to daily deposits.
It's time to get MAD about Revenue Cycle Management! The keys to being a MAD success are Measurement, Accountability and Discipline.