Posts Tagged ‘denials’

Guest Post: Real-Time Data Analytics Key to Decreasing Denial Rates, Saving Time and Lowering Costs

February 22nd, 2018 by Jonathan Farr, Senior Vice President, North America, EFFY

For hospital and health system leaders, financial challenges pose some of the most insurmountable hurdles, with claim denials a significant contributor. Consider the numbers: annual losses from denial write-offs average 5 percent, and up to 15 to 20 percent of initial denials occur with the first billing. The burden of reworking denials not only impedes the revenue cycle process, but can also compromise care quality.

Furthermore, the number of hospital mergers and acquisitions surged by 15 percent between 2016 and 2017. This has generated massive sets of disparate data that must be reconciled and reviewed, creating an environment where the revenue cycle management (RCM) process can be fraught with missteps. As a result, today’s hospital leaders seek new opportunities for maximizing revenue, and identifying solutions that enhance both financial and clinical performance.

Optimizing Revenue Cycle Management

Issues that lead to denials occur throughout the revenue cycle. Certain best practices are helpful for hospitals of every kind and size, such as taking steps to minimize denials up front, managing them through efficient workflows and processes, and analyzing denials after the fact to identify common causes.

Perhaps the most important step hospitals can take is to find the right RCM solution to optimize financial performance—one that doesn’t require replacing an existing and often expensive operating system (OS). The best option is to find a partner that offers an actionable real-time or near real-time data analytics platform that overlays or integrates with the current installations.

Actionable Real-Time Data Analytics

An actionable real-time data analytics platform, especially one powered by an RCM optimization tool that has been proven effective across leading healthcare systems, telecom companies, utilities, retail and other complex industries, can help hospitals significantly minimize denials, and save time and money.

How does an RCM optimization tool work? It can audit and trigger efficiency actions in a way that is non-intrusive to the day-to-day work of the revenue cycle clerical staff. What’s more, this type of solution offers an efficiency platform that overlays an existing system to help healthcare organizations compare massive amounts of data across their total enterprise, detect exceptions and problems, and guide actions and interventions to improve efficiency.

An actionable RCM solution has the reconciliation and analytical tools that help organizations gather and compare data enterprise-wide, detect deviations, issue alerts and offer an integrated workflow to guide the ‘fixes’ they need.

With this solution, hospitals do not have to discard their OS because the RCM solution overlays the current installation, provides the necessary analytics and drives the corrective actions needed. Even better news for hospital leaders, this type of innovative RCM solution eliminates the need for large up-front acquisition costs, representing a financial transaction that does not compromise the bottom line.

Impressive Returns

An RCM solution that uses actionable real-time data analytics and powerful action-driven analytic tools has seen proven results: for one not-for-profit hospital, savings related to denials and write-offs continued to accrue and reached upwards of $800,000 in the first six months of operation.

Furthermore, back-end processes were streamlined, relieving stress and time constraints imposed on the clinical staff. Inadequate documentation of medical necessity was addressed, allowing the hospital to transition charges to patient self-pay or to initiate a change in the course of treatment.

This type of RCM solution represents the future of data analytics, helping hospitals increase net revenue by 3 to 4 percent, with ROI multiples of between eight and ten. It also allows a hospital to use any data from any OS to set up sophisticated validations to detect issues immediately.

By simply overlaying an actionable real-time data analytics system, RCM managers can quickly gain control of aggregated data, and detect/resolve issues that impact revenue integrity, as well as clinical and operational performance, in a way that is truly cost-effective.

About the Author: Jonathan Farr, MHA, is Senior Vice President, North America, for EFFY. Jon has prior experience managing general acute hospitals, surgical hospitals, emergency centric hospitals, behavior health hospitals, and a large physician practice, both for-profit and not for profit, urban and rural, domestic and international. He is highly respected for his ability to work with physicians, boards, committees, regulatory agencies, third party payors, vendors, patients and all levels of personnel. Jon earned a Master’s in hospital administration from the Medical College of Virginia and is a member of the American College of Healthcare Executives.

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