Payer Contract Adhesion – And What They Can Do For Your Revenue Cycle Audit

Every ambulatory surgery center (ASC) strives to manage its revenue cycle as efficiently as possible. Mistakes or delays in coding, billing, and collections can lead to financial challenges. No center wants to show a loss in revenue because of flawed revenue cycle management practices.

Regent Revenue Cycle Management encourages ASCs to perform three regular audits to detect and correct errors before they become larger problems. Regent RCM has created a new guide that details how centers can take simple, concrete steps to track and improve their revenue cycles:

  • Denied claim cause and management
  • Coding accuracy
  • Payer contract adhesion

Payer Contract Adhesion

In our third and final blog of our three-part series, we focus on why negotiating fair payer contracts – and making sure that all terms are met – is a critical part of revenue cycle management.  Your revenue cycle team needs to know every detail of their contracts, so they can fight for every dollar.

Regent RCM advises centers to conduct an audit on each of their payer contracts to understand what the contract says, what their center is allowed to bill, and how they can avoid over- or under-payments. The ultimate goal is for ASCs to receive exactly what they are owed – no more and no less.

When negotiating a contract, Regent RCM recommends following these five steps:

  • Start at least four months before the anniversary of the contract
  • Check the terms of the contract carefully
  • Build relationships with payers
  • Be aware of evergreen contracts that roll forward without renegotiation or a termination date
  • Keep all contracts current to make sure they aren’t falling behind

Learn how to perform our three audits to enhance your ASC’s financial performance. Download the guide here.

Leslie Favela Promoted to Manager, RCM Business Development

Leslie Favela, a seven-year veteran of Regent Surgical Health (RSH) who most recently served as Revenue Cycle Coordinator with Regent Revenue Cycle Management (RCM), was promoted in January to the newly created position of Manager of RCM Business Development. Reporting to Erin Petrie, Regent RCM’s Director of Revenue Cycle Management, Favela will continue to perform business audits for ambulatory surgery centers (ASCs), providing them with valuable business metrics while also adding business development responsibilities to her plate.

Petrie says Favela’s experience across several other roles within Regent – and especially her recent support for RCM business audits, new business pitches and presentations – makes her transition into this new role a perfect move. “Leslie has been a valued player for several years and understands both our capabilities and our clients’ points of pain,” Petrie says. “And, she has the personality to bring it all together to help us grow.”

Favela believes the evolution of business within healthcare reimbursements makes the billing and collection services provided by Regent RCM even more valuable to ASCs. “The timing is right for this new position,” she says, “because payers today are undergoing dramatic changes that make it even harder for an employee of any one ASC to stay up-to-date on all of the policies. We have our view across many different ASCs. This allows us to leverage best practices as we bring each new center on, as well as identify strategies to improve current processes and deliver true value.”

Favela started her RSH career as an office coordinator and has worked her way up through several departments and promotions to gain a thorough understanding of ASC management, more specifically the ins and outs of revenue cycle.

“I have a huge passion for the work of Regent RCM because I have been involved since we doubled the number of centers we serve. I want to continue to build the company’s reputation so that new ASCs come to us for billing and collections and the value that we bring.”

To learn more about Regent RCM’s turnkey billing and collections services exclusively for ASCs, click here.

Demystifying Managed Care Contracts, Part Two: 5 Contract Language ‘Watch Outs’ for ASCs

In any negotiation, both parties come to the table with their own list of terms they’d like to see in the final agreement. In this second blog in a 3-part series on demystifying the process ambulatory surgery centers (ASCS) go though in negotiating contracts with health plans, Regent RCM Vice President of Managed Care Andrea Woodell shares language “red flags” to help ASCs leaders avoid common pitfalls in payer contracts.

“In our work with ASCs across the country, we see hundreds of contracts – that’s one of the benefits Regent RCM brings to the table as a management partner,” says Woodell. “A local ASC leadership team doesn’t always have that perspective, but the health plans they’re negotiating with do. So it’s really helpful to know some of the language to watch out for, and to be armed with the ammunition you’ll need to come to agreement on payer contracts that allow you to stay profitable.”

Woodell outlines five areas where ASC leaders should be on the lookout for sub-optimal contract language:

Term of the contract: If the contract extends more than one year, have you successfully negotiated a cost-of-living increase for each subsequent year?

“Lesser of” language: You’ll see this with TPAs or national PPOs. They’ll negotiate 65% of bill charge for example, and the ASC may say ‘great, I’ll take that all day.’ But then the language goes on to read ‘or the lesser of’ xyz. Any time you see the language ‘or the lesser of, ‘buyer beware. I’ve seen commercial business get repriced to 100% of Medicare or 100% of Medicaid. This happens regardless of what you’ve negotiated, because they have ‘the lessor of’ language allowing default to a lower state or federal mandated fee schedule.

Escape clause: What’s your ability to get out of the contract? Most contracts will read that you’re unable to cancel within the initial term of the contract, typically 3 years. It’s important to be certain that you can get out of a contract when you need to — a 90- or a 120-day out clause is ideal.

Indemnification: If they want to be indemnified, we get to be indemnified. It’s reciprocal, or not at all.

Timely payment: Strong contracts stipulate payment of a clean claim within 30 days. One metric driving margin is how quickly you collect your money. But often, you’ll see 45 or 60 days in a draft contract. Be on the lookout for that.

For more help with negotiating you next contract, contact Woodell here. And, watch for the final installment in this series, focused on specialty-specific contract tips.

How to Improve Your Revenue Cycle Audits through Coding Accuracy

Disorganized revenue cycle management practices are damaging to an ambulatory surgery center’s (ASC’s) financial performance. A flawed process can lead to lost staff productivity and worse – missed revenue.

An efficient revenue cycle is established when all the details of coding, billing, and collections are submitted on time and correctly the first time. ASCs can improve how they manage their revenue cycle by implementing a few simple but effective steps to recognize problems and determine solutions.

Regent Revenue Cycle Management released a new guide uncovers three regular audits ASCs can perform to analyze inefficiencies and enhance revenue cycle performance. The latest guide recommends analyzing these three areas:

  • Denied claim cause and management
  • Coding accuracy
  • Payer contract adhesion

Coding Accuracy

In our second installment of a three part series, we focus on how coding accuracy is critical for an ASC to minimize denied claims that result in wasted staff time and lost revenue. A center should set an aggressive goal for coding accuracy – Regent RCM’s gold standard is 97% – but first, it must understand its baseline.

A coding audit reviews codes submitted to payers and compares them to what is supported in the documentation. A successful audit identifies problem areas and creates an opportunity to regulate coding compliance and potentially enhance revenue.

Regent recommends following these steps to ensure coding accuracy:

  • Conduct an audit twice a year. Catching errors early gives better odds of rebilling or appealing claims.
  • Use a third party. An external auditor can more objectively examine data and information.
  • Analyze and understand trends. Familiarize staff with common procedures and best billing practices to be able to catch any errors on coding.

Learn more about the other audits and how to perform to improve your ASC’s revenue cycle management. Download the guide here.

Demystifying Managed Care Contracts to Keep Your ASC Profitable Part 1

Getting a handle on managed care contracts can be a mind-boggling task for ambulatory surgery center (ASC) leaders, but it is critical to profitable operations. Andrea Woodell, Regent RCM’s vice president of managed care, has extensive experience negotiating payer contracts. In this first blog in a 3-part series, she explores key payer contracting questions that impact profitability. Part 2 will offer “red flag” language to watch out for in negotiations with health plans, and the third blog will address specialty-specific contract tips.

According to Woodell, a center’s primary specialty is an overall driving force for payer contract negotiations. “And when a center adds a new line of business, it’s important to update contracts accordingly,” she says. “Each specialty has unique requirements that mandate how you structure a fee schedule in order to safeguard that specialty.”

When negotiating payer contracts, three key questions can have a big impact on ASC profitability:

How is your center performing overall by payer by service line?

“If you’re a single specialty ASC, this will be a fairly simple exercise,” Woodell says. “For example, if you’re doing GI or ophthalmology, you can evaluate as a percent of Medicare how each of the health plans is paying you for that specialty. In addition, you should always take into consideration the payer mix, prioritizing those contracts that you can influence.”

Beyond specialty and payer prioritization, factors influencing contract negotiations include what carve outs you can negotiate, how multiple surgeries and implants are paid, and how non-grouped procedures are paid.

“As a rule, there’s going to be an established rate baseline of what payers think they can contract in your community,” Woodell explains. “And they’re going to come in low. It’s important that you reply with an objective, logical approach to why their offer is not adequate. You want to give them little snippets of what the cost of the case is, by providing implant invoices or data on operating room time, associated recovery, disposables. Work with your partners to quantify outcomes, recovery or back to work and share this data with the payers. Member satisfaction remains a priority for carriers. All are important as you evaluate your service lines and how each payer reimburses.”

Once you’ve identified a health plan that’s reimbursing well, that contract can become your target for others. Woodell recommends a focus on best price, best customer to avoid enabling other payers to pay lower than a good customer.

How does performance by service line and payer affect operational margins?

“If you’re not making money, that’s the operational impact,” Woodell says. “You could have a contract that reimburses GI great, but if you also start doing general surgery and your implants aren’t covered you have a problem. For example, general surgery uses implants, hernias require mesh. Laparoscopic cholecystectomy uses a great deal of disposables that are expensive. When you negotiated your contract for just GI cases, you didn’t care if implants were covered, because you didn’t use them. But now you’re broadening the scope of your ASC and there’s no margin on the general surgery. Margin is driven by reimbursement by product line

What data should you be tracking for each payer?

Woodell suggests ASCs collect data on timely payment, payment accuracy, and data to ensure implants are being paid at the contracted rate. For instance, if a payer is late paying claims, are they paying the state penalty? And while there’s very little ASCs can do if payers stall, Woodell suggests they appeal and be sure to collect the interest. In addition, she says having patients call the health plan can help: “Health plans don’t like member complaints. If you have patients who are good advocates for themselves and for the surgeon, the health plan won’t hesitate to pay – with the shift in payment responsibility, patients pay a lot for their healthcare, and will be eager to step up to ensure the health plan is paying their share as dictated by benefit structure.

Another data point Woodell recommends: make sure payers are not inadvertently transferring the balance of what they owe to a patient responsibility. She says such transfers can happen within payer systems for several reasons.

Want to know more about demystifying the payer contracting process? Watch for the next two blogs in this series, or contact Woodell here.

How Does Your ASC Measure Up? Benchmarking Basics for Revenue Cycle Health

Until recently, when it came to “diagnosing” revenue cycle health, ambulatory surgery centers (ASCs) often turned to hospital or physician practice metrics, due to a lack of revenue cycle measurement tools developed specifically for them. But ASCs really needed a view into revenue cycle performance that factored in the business challenges unique to their business model and circumstances.

Regent Revenue Cycle Management (Regent RCM) has addressed that need head on with development of ASC-specific benchmarking tools that ASC leaders can customize and deploy. In a white paper titled, “Using ASC-Specific Benchmarks to Assess the Health of Your Revenue Cycle,” Regent RCM shares nine ASC-specific benchmarks to help track and measure revenue cycle performance. The paper outlines how surgery centers can use the benchmarks to assess their revenue cycle; including understanding how numbers can be improved, why they might fluctuate and how they can often be misleading.

The benchmarks dive deep into key components that shape and define revenue cycle health, offering both a benchmark and a Regent RCM “Gold Standard” to help ASCs understand what’s optimal and work to improve in each of the following areas:

1. FTEs/1000 Cases
2. Days Outstanding/Days in AR
3. Percent of AR Over 90 Days
4. Claim Lag
5. Charge Lag
6. Statement Lag
7. Claim Denial Percent
8. Clean Claim Percent
9. Net Collection Rate

The white paper also includes examples of success gained through application of the benchmarks. For example, one facility in the southeast significantly improved the efficiency of its Accounts Receivable efforts through consistent follow-up with accounts and a more thorough understanding of how each payer processes claims. In another ASC, a high volume orthopedic center, collections were nearly doubled from May to December, with no significant changes to volume or case mix. In this case, Regent RCM’s benchmarks helped the ASC work with its clearinghouse to develop custom edits to ensure clean claim submission.

Regent RCM is a leading provider of innovative and cost-effective revenue cycle management services exclusively for ASCs. To learn more about the company’s benchmarking tools for ASCs, download the white paper here.

asc revenue cycle billing analysis

Uncovering Improvements through Denied Claim Cause Audits and Management

No ambulatory surgery center wants to miss out on revenue because of inefficient revenue cycle management practices.

An organized and streamlined revenue cycle requires an ASC to get every detail of coding, billing, and collections right the first time – and on time. By following a few straightforward – but important – steps, ASCs can review their current revenue cycle management processes and identify any problem areas that need to be resolved.

Regent RCM has developed a new guide that outlines three regular audits ASCs can incorporate to uncover mistakes and inefficiencies in order to enhance revenue cycle performance. The guide recommends three strategies to analyze and improve:

  1. Denied claim cause and management
  2. Coding accuracy
  3. Payer contract adhesion

In this blog, we outline the denied claim assessment and how to better manage these audits.

Around 10 to 20% of healthcare provider revenue is tied up in denials, and the top two causes for denied claims are missing information and inaccurate information. ASCs can dramatically improve their financial performance just by reducing the number of claim denials.

Regent recommends taking these actions to manage denials more effectively:

  • Act immediately. – Address every denied claim within a week of receiving notice from an insurance company.
  • Investigate the cause. – Reach out to the payer to understand why the claim was denied and how it can be amended.
  • Track past claims. – Analyze the reasons for denied claims and approaches that have been successful to tweak current processes.
  • Watch for patterns. – Pay attention to which errors, like misspelled names or missing information, are most common in denials.
  • Focus on prevention. – Remember that avoiding denied claims is the most effective way to minimizing days in A/R.

Learn how to implement this audit and our other strategies to uncover revenue cycle inefficiencies and boost financial performance. Download the guide.

Billing Mistakes and How to Avoid Them: Part 2

An ambulatory surgery center depends on an efficient revenue cycle management process for financial and operational stability. Because the revenue cycle involves complex and overlapping processes, an ASC needs a revenue cycle solution that can manage everything from billing and collections and payer contract negotiating to measurement and reporting and automated workflow tasks.

Billing mistakes can cause serious problems for an ASC, interfering with its immediate cash flow and long-term financial health. In a recent post, Regent RCM outlined prevention tactics for four common ASC billing errors. The second part of this series will examine four additional billing mistakes and how to avoid them.

  1. Not Reconciling Billing

It is crucial for ASCs to monitor patient files carefully, making sure that all performed procedures are billed and followed up on. Unbilled procedures result in lost revenue, damaging a center’s revenue cycle. Similarly, cases that are denied or rejected by the payer must be properly appealed or processed.

Solution: Utilize a system that tracks all performed cases and ensures that they are billed out within a certain timeframe. Use automated tools as much as possible, setting up notifications and reminders to follow up on claims or make edits as necessary.

  1. Neglecting to Appeal Claims

Inaccurate payments are unfortunately commonplace within the revenue cycle. The real problem arises when ASCs fail to appeal incorrect or incomplete payments in a timely manner. If a center doesn’t maintain a quick and streamlined appeals process, it can fall into harmful patterns and struggle to meet its financial goals.

Solution: Address flawed payments right away, setting a specific turnaround for sending out appeals. Regent RCM’s standard is to appeal all under- and no-pay claims within 24 hours.

  1. Not Measuring Performance

Unidentified problems can’t be fixed. Kept busy with day-to-day responsibilities, ASCs often neglect to monitor key performance metrics of their revenue cycle – and any problems with net collection rates, A/R days, or statement, charge, or claim lags remain unresolved.

Solution: Implement measurement and reporting software to track specific benchmarks in the revenue cycle. Gauge the current health of the ASC’s performance, and set goals going forward. For example, the Regent RCM gold standard net collection rate is a minimum of 97%.

  1. Errors in Payment Posting

Erroneous payment posting can lead to confusion and financial losses for an ASC. A simple mistake, such as a typo in a payment amount, has a domino effect: an incorrect patient responsibility and billing statement, back-and-forth communication with the patient, a statement adjustment, and so on.

Solution: Check that all billing, payment, and collection information reconcile properly. If it is a challenge to manage the process with in-house staff, outsource it to a company with expertise in revenue cycle management. Regent RCM uses sophisticated software to post payments, ensure that they are paid according to contract, and turn over bad debts to collections.

Need expert assistance in improving your revenue cycle management? Contact Regent RCM

Becker’s 25th Annual Meeting: What we Heard on the Tradeshow Floor

Regent RCM’s leadership team recently attended the Becker’s 25th Annual Meeting: The Business and Operations of ASCs.

While there was a plethora of great information to take away from the show, Director of Revenue Cycle Management Erin Petrie  picked up on a few common pain points among center leadership, including:

  • The increasing difficulty of negotiating payer contracts
  • The need for ASC-specific revenue cycle benchmarking data
  • The rise of bundled payments – and the race to execute successfully

We drilled down on two of those issues in our latest guide,  3 Revenue Cycle Audits That will Improve Collections and Lower Days in A/R, where we identified inefficiencies and mistakes that put ASC financial performance at risk and shared best practices around denied claims, improving coding accuracy and payer contract adhesion.

If you’re interested in learning more, click here to stay abreast of ASC news via our blog.

Regent RCM Guide Identifies Inefficiencies and Mistakes that Put ASC Financial Performance at Risk

What can surgery center leaders do to ensure an efficient revenue cycle? What processes can be enacted to minimize mistakes in coding, billing and collections? Regent Revenue Cycle Management, a leading provider of innovative, cost-effective revenue cycle management services exclusively for ambulatory surgery centers nationwide, has published 3 Revenue Cycle Audits That will Improve Collections and Lower Days in A/R, a new guide that offers strategies to enhance efficiency and drive growth in 2019.

“No one wants to miss out on revenue due to insufficient revenue cycle management practices,” states Erin Petrie, Regent RCM’s Director of Revenue Cycle Management. “Our new guide illustrates through best practices and case histories that follow simple—yet critical—processes can ensure that when mistakes are made, they are corrected quickly, and new processes can be enacted to make sure you rarely make the same mistake twice.”

This publication outlines the recommended timing and processes for analyzing and improving:

  • Denied claim cause and management
  • Coding accuracy
  • Payer contract adhesion

3 Revenue Cycle Audits that will Improve Collections and Lower Days in A/R will help centers to collect every dollar they are owed and set them up for long-term growth and success,” Petrie states.

The new guide is available for download now.

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