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A 2017 study by the Advisory Board revealed that the average 350-bed hospital could make up a lot of ground by following revenue cycle best practices; to the tune of $22 million! What can Peak do to help providers capture some of this lost revenue?
Justin Schmidt, Senior Vice President & Founder:
Great question! It helps to understand what is creating this gap in revenue. Several market factors are at play, and they all contribute their part. The study cited four main areas of lost revenue: denial write-offs, bad debt, the cost to collect and contract yield.
The truth is that commercial payers are more attentive and frugal than ever. More frequent claim denials are how providers feel this pinch. This realization comes as no surprise. Every organization in healthcare is working to tighten their belts while still providing the best care.
We believe an ounce of denial prevention is worth a pound of denial management. Improved clinical documentation, accurate coding and better physician engagement can all help get claims paid more quickly and accurately the first time. The following are three things that Peak does to help our clients every day that go a long way toward preventing denials and getting back some of that revenue providers are losing. Let's look at each in a bit more detail.
1. Build a Best-in-Class Clinical Documentation Improvement (CDI) Program
Clinical documentation and the data it provides drives the billing process. The better the clinical information, the more accurate the billing is. This reality is especially true as value-based reimbursement continues to grow. Now, more than ever, excellent CDI programs are a must.
Launching a best-in-class CDI initiative starts with assessment. At Peak, that's where we always begin. The current program should be evaluated to ensure workflow and query/clarification processes, response rates and Case Mix Index (CMI) impact are at optimal levels. Once set, baselines make it easier for us to help define attainable goals and see which areas need the most improvement to reduce denials.
2. Improve Coding Accuracy and Productivity
Coding may seem like a commodity, but exceptional coding can make a dramatic difference to a hospital's financial health. It's been the bread and butter at Peak for a long time, and we take great care to do it exceptionally well. Frequent training, continuous monitoring and regular audits are three ways that Peak helps providers keep the coding process running smoothly and denials in check.
When denials do pop up, and some will appear despite the best efforts to avoid them, a coding denials specialist dedicated to tackling only these more difficult cases can allow the coding teams to continue uninterrupted. At Peak, we have found this practice to be extremely helpful. This specialist can also spot trends and repeated errors that can help educate the coding teams to improve performance and cut down on future denials.
3. Encourage Physicians to Actively Participate in Denials Prevention
It is more critical than ever that physicians buy into a CDI program and play an active role in preventing denials. After all, physicians are the ones who document patient care and respond to queries. If they aren't reacting quickly or don't believe in the process, the program will underperform. We work with physicians every day to guide them and educate them on best practices.
Incomplete or inaccurate documentation can lead to a spike in denials further down the line. Establishing efficient query workflows and a streamlined documentation process can keep physicians engaged and focused. By doing so, physicians will have more time for patients and the coding teams can avoid more denials.
Denials Management is Just the Beginning
While denials don't represent all the money providers may be leaving on the table, it can be a significant portion if left unchecked. With a best-in-class CDI program, accurate coding and physicians who are engaged, denials don't have to be the thorn they once were. By following best practices, hospitals can reclaim some of the revenue they should have been getting all along. Over time, keeping denial rates low can improve the cost to collect reimbursement and in turn free providers to focus on other areas that need improvement.
At Peak, our talented Healthcare Information Management (HIM) professionals work with clients to implement CDI programs that perform, manage coding teams that improve accuracy and efficiency, and work with physicians to bring it all together.
Do you have questions about how you improve your Mid-Revenue Cycle you'd like answered by the experts at Peak Health Solutions?
Profile of our Expert
Justin Schmidt, Senior Vice President & Founder
Justin Schmidt is a co-founder and President of Peak Health Solutions. Justin has over 15 years of experience in healthcare management and has played a vital role in managing and building the Provider Business Unit for Peak Health Solutions. He is the key leader around the strategic planning for Peak both domestically and internationally which include operations, financial management and sales/marketing. In addition, he is responsible for the growth and management within the Government business unit for Peak Health Solutions. Justin has a degree in Business Administration from Boston University.