Revenue Cycle Management (RCM) is the backbone of all medical billing and coding companies. It is, in fact, the functional core that helps handle all processes, starting from making a patient appointment to managing appeals and reimbursements. The right RCM process increases revenue and profitability, improves reimbursement rates, and brings down the rate of bad touches.
Some companies handle their RCM processes in-house, while a majority of them outsource the same. Either way, how does one measure the health of the current RCM process?
Here is a list of five essential Key Performance Indicators (KPIs) that any RCM process should have to ensure it is worth the time, effort, and money you spend.
Does your RCM process have these KPIs? Do these KPIs match the current industry standards? Check the list out.
Days in A/R is one of the most vital RCM KPI that you should track.
Days in Accounts Receivable is the time taken between offering a service and getting paid. Now, an RCM service company handles a variety of processes like patient data management, coding, data entry, rejections, appeals, credit balance management, and AR follow-ups.
When these intermediate processes get delayed, the number of days between your client offering a service and getting paid will also get extended.
According to industry standards, Days in A/R value of less than 30 is considered excellent. This is the A/R bucket a majority of your claims need to fall into.
If your Days in A/R value is between 40-50, you are like most other mediocre medical billing and coding companies, and if your A/R value is more than 60, then you may have to make some serious tweaks to your RCM process.
How do we handle days in A/R?
Reimburssence is Quintessence’s one-touch solution to ensure that claims are processed while in the initial A/R bucket and paid for early on. This intelligent system takes up claims, categorizes them, and helps make the right decisions. This, in turn, reduces the touches to closure, ensuring that services get paid quickly.
Clean Claim Rate (CCR) is another essential KPI determining how successful your RCM process is. CCR measures how many claims are successfully reimbursed in the first attempt Vs. the total number of claims submitted.
When a particular claim is not reimbursed the first time around, your team has to spend more time on paperwork and resubmitting the claim. An RCM process with a low CCR rate gets highly inefficient with time.
We believe that for claims to be cleared the first time around, the initial processes that you invest in have to be solid and thoughtfully created.
Quintessence’s Codessence tool is a perfect front-end accessory to ensure mistakes don’t happen in the initial stages. By guaranteeing the initial codes are perfect, the tool ensures the number of rejections goes down. It further spots and corrects manual errors in the codes automatically.
The tool is designed to meet all the compliance parameters and is also completely audited by coders, improving our CCR, consistently beating industry standards.
Our processes are also designed holistically to create a rule engine that keeps a check on the process and makes the right decisions the first time around. This also helps us maintain high clean claim rates.
Claim Denial Rate (CDR) is an equally important KPI for RCM businesses as CCR. This is the measure of how many claims were rejected by the payer Vs. the total number of claims submitted.
Logically, the lower the CDR value, the better it is for the service company. If the claims that you submit keep getting rejected, it means there is a fundamental problem with your Medical billing and coding, data entry, payments, or receivable management process.
According to experts, your CDR should preferably be less than 15%.
We get this done with the help of our smart BOTs. Our bots are designed to identify and bring down errors across our medical billing and coding processes. The tiniest of errors that go unmonitored can increase your CDR excessively, affecting the SLAs that you have with clients.
QuintAna is one of our happening series of BOTs that is designed to completely overhaul your RCM process and bring about accuracy, precision, and speed. Do get in touch with us to know more about how QuintAna works.
Let’s say you are a medical billing and coding company handling RCM services for large healthcare organizations. The allowed amount is the maximum amount a particular plan may pay in terms of coverage. The Net Collections Rate (NCR) is a measure of how much reimbursement you manage to collect when compared to the total allowed amount.
NCR is affected by many other factors like bad debt, claims denial rate, and delayed filing. It is a clear indicator of your client’s effectiveness in collecting reimbursements. Without a doubt, the higher the NCR value, the better it is.
At the end of the day, when the RCM processes work well, the NCR value improves, and the company’s financial position gets better.
Your Net Collection Rate has to be above 90% all the time, if you want to impress your clients and add value to their business.
Quintessence’s End-to-End tool optimizes the entire workflow and is designed to spot leakages in your RCM process. As a result, we are able to monitor the process end-to-end, keeping a check on all factors that may cause a dip in your NCR. This tool keeps a live check on your claim statuses, helping you take quick actions on potential problems that may affect your KPIs.
At Quintessence we have our own set of KPI’s that we consider ensuring that our quality of service is of high yielding for your practice. The above discussed KPIs are the traditional method to evaluate the strength of your Medical Billing and Coding process. Quintessence tries to look deeper and find out unique indicators that can reflect the health of the process.
Touches towards closure – For claims in the AR and denial bucket, it is important to take faster and accurate resolutions to ensure that claims are worked towards payment, keeping in mind the timely filings. This necessitates to check if every time a claim that is in AR Is worked, it should result in claim closure, if not it indicates that the action taken was inappropriate or incorrect. There is a need to re-work on the claim again hereby increasing the Age of the claim, The longer the claim in the bucket the lesser the chance of getting paid.
That’s why at Quintessence we measure the number of touches on a claim and categorize them as good touch and bad touch. We also track user productivity through this. This helps us in identifying any issues in AR and denial management. Our clients can take a direct look at the quality of work done through this form of measure.
Payment velocity – Payment velocity refers to the number of claims getting paid in each AR bucket. Claims are categorized by their age and payer, and the payments monitored. Identifying the payment velocity helps in determining conditions where the claims are underpaid or unpaid and how to prevent claims from getting stuck in this cycle. Payment velocity also helps us in understanding payer dynamics. This is particularly useful in helping build tools and BOTs for process optimization.
Documentation – There are various Qualitative measurements that are of high significance in improving the health of a practice, one such is clinical documentation. Starting from coding and all the way to appeals, accurate documentation has a direct impact in faster payments. To know more about how Quintessence work with providers to improve their documentation, click here
As an RCM partner, you definitely will have to keep track of these essential KPIs at every point in time. Identify industry standards for each of these performance indicators and set internal targets to go above and beyond these targets. Medical billing and coding companies can improve their margins, save costs, and speed and scale-up processes when their RCM strategy is in place. Quintessence touches every aspect of RCM and adheres to SLAs from day one. Our RCM KPIs match industry standards and can be customized to match your exact requirements. Get in touch with us to know more about how we can help you shatter boundaries and grow at a pace that suits you.