6 KPIs for financial success in 2018 and beyond
There are many moving pieces in a modern medical practice or other healthcare organization today — in fact, too many to focus on to ensure your business is financially successful and enabling you to provide the best-possible health services and outcomes.
While there are a number of quality performance measures that providers must achieve, there are also a number of financial measures or Key Performance Indicators (KPIs) that must be closely watched to determine your success in optimizing billing processes while collecting more for services rendered. It’s true that value-based payment under Medicare and an increasing number of commercial payers are focusing on quality and satisfaction metrics, but cost is also an increasing part of the formula for measuring your performance in the current year and thus your reimbursement rates two years later. The KPIs discussed here will help you both now and for the fast-approaching future.
As a revenue cycle services partner, it’s our job at Advantum Health to constantly gather, monitor, and use advanced analytics to quickly uncover areas rife for improvement and determine root causes. We work with clients to educate them on how to optimize revenues under MIPS, the Merit-based Incentive Payment System (along with Alternative Payment Models) used to reimburse for Medicare services. And as history has shown us, what’s embraced by Medicare soon sets the standard for other insurance programs.
Six essential financial KPIs
Virtually real-time data, advanced analytics with alerts and easy-to-interpret dashboards are enabling Advantum’s RCM experts to quickly note downward trends and actions to take, particularly in these six-revenue cycle KPIs critical for success in 2018 and beyond:
Denial rate — Percentage of total claims denied as a percentage of total claims submitted
Days in Accounts Receivable — Your total receivables/credit balance compared to your average daily gross charges
A/R greater than 120 days — Percentage of long-term A/R (receivables “on the books” 4 months or more) of your total receivables
Gross collection rate (GCR) — Percentage of sum of total payments versus total submitted charges or claims
Net collection rate (NCR) — Percentage of payments/credits versus charges with contractual adjustments
First-pass claim-acceptance rate — Percentage of paid transactions versus total number of submitted transactions, based on the first submission
Optimizing these is a time-consuming process, especially for providers who don’t use an electronic health record (EHR) and practice management system to rapidly pass along claims to their RCM partner for completion and submission. Paper superbills take a practice much longer to process and errors occur more easily. And if claims aren’t correctly processed and within a health plan’s timely filing criteria, it’s money that’s left on the table or can never be collected.
The power of automation: Bots, Dashboards, Alerts, oh my!
Advantum continues to develop and enhance innovative automated tools to speed gathering, extracting, analyzing and using real-time data to identify issues and implement changes that improve results.
Our most-recent strategic imperative has been implementing Robotic Process Automation. Using RPA technology, we’re eliminating most of the human intervention required to extract data and create reports. We created bots (short for web robots) that go into clients’ EHR and practice management systems each day to pull needed data, push it to our data warehouse and then populate our dashboards in near-real time. This frees up our revenue cycle experts to use these tools and the insights they help provide, enabling them to spend more time with clients to improve processes and optimize results. Our dashboard is predominantly controlled using bots with little human intervention as we continue to fine-tune and further enhance this innovative new technology solution.
Starting to apply our advanced tools, we took a “deep dive” into the data to determine the activities and results of each individual practice, as well as evaluating them across other clients by region, specialty and subspecialty. This provides the foundation for continued improvement, and gives our account leaders a faster and more thorough way to keep abreast of the financial health and operations of each client.
More than financials
It’s not just the financial KPIs that we monitor. Under MIPS’ Quality Payment Program (QPP), there are quality measures that evolve each year which are critical to achieving quality incentive payments. As part of our value-added services, we stay abreast of those changes, how each eligible physician is achieving them, and provide information and insights when indicators are off-track. This is critically important with the rapid shift to value-based payments versus the traditional fee-for-service model.
Clinical alerts are built into the EHRs to promptly inform caregivers when a lab result or blood pressure, for example, fall outside of normal ranges. Similarly, we’re enhancing our advanced analytics platform and dashboard to alert our account leads when something is out of established range based on a practice’s standard performance and/or industry benchmarks. This enables us to quickly drill down and then follow up with the client to examine systems and processes and recommend best practices to avoid any further negative impacts. And since we’re basing discussions and changes on solid numbers and analytics, we can have a straightforward and impactful conversation by giving clients a clear picture of where they stand and why, what we’re doing to address it, and what else we can do together to maximize their financial situation.
The best revenue cycle partners — armed with solid facts and analysis — can help keep a practice’s financial operations running smoothly and optimally in the ever-evolving healthcare marketplace.
If Advantum can help you survive and thrive — whether you’re interested in learning more or would benefit from our premium service packages for additional support — please call us at (866) 814-5652 or email firstname.lastname@example.org.