Audits. Codes. Reporting. Physician concerns such as  “compassionate care”, “effective communication”, “patient engagement” are being replaced with a focus on the completion of administrative tasks – at an alarming rate.

hospital revenue cycle challenges include increased AR days and more

While doctors are juggling mounting reporting tasks that threaten quality patient care, other hospital revenue cycle challenges persist.

In addition to this ongoing challenge – hospital revenue cycle health struggles with claims that have abnormally prolonged accounts receivable days due to payer inconsistencies, claims denials, and billing disputes that in some cases ultimately lead to civil or criminal action.

What should healthcare organizations do to manage their hospital revenue cycle flow and meet administrative reporting requirements? We review recent news articles and studies that uncover these struggles and provide guidance on how to improve clean claims rates and avoid legal action that can result from faulty claim submission.

Is Measuring the Quality of Care Hindering the Ability to Provide It?

In an attempt to improve quality of care – health systems, hospitals, and physicians are now responsible to report on various factors, accurately submit data, and meet specific criteria just to ensure they are paid for the clinical services they provide. A common gripe shared among the majority of healthcare professionals is that this increased time and energy spent on administrative tasks takes away from their ability to provide quality patient care.

The administrator for the Centers for Medicare and Medicaid Services (CMS), Seema Verma, recently pointed out the mounting disruption on patient-centered care caused by the administrative burden of measurement requirements on health systems, providers, and hospitals. According to Verma in a CMS press release:

“We need to move from fee-for-service to a system that pays for value and quality ― but how we define value and quality today is a problem. We all know it: Clinicians and hospitals have to report an array of measures to different payers. There are many steps involved in submitting them, taking time away from patients. Moreover, it’s not clear whether all of these measures are actually improving patient care.”

Virgina All-Payer Claims Database (APCD) Now Includes Medicare Information

In order to submit reliable claims and billing information, access to current Medicare data is necessary. Virgina took a step through legislative action to improve this access by adding Medicare data to a Virgina database of healthcare records.

Augusta Free Press reports: “Medicare data recently was added to Virginia’s All-Payer Claims Database (APCD), a subscription-based service administered by the Virginia Department of Health (VDH) through the non-profit Virginia Health Information (VHI) organization.”

This act was established in 2012 during a state General Assembly session, and participation is on a voluntary basis. As stated on the APCD website, the purpose of this initiative is “to facilitate data-driven, evidence-based improvements in access, quality, and cost of healthcare and to improve the public health through an understanding of healthcare expenditure patterns and operation and performance of the healthcare system.”

In July, the addition of Medicare data was announced, and the database now includes information from federally-funded healthcare (i.e. Medicare and Medicaid), as well as information from some commercial health insurers, pharmacy benefits managers, health care subscription plans, submissions by third-party administrations, and the Virginia Department of Medical Assistance Services. Access to this information is designed to help providers and hospitals submit accurate and thorough data needed for claims approvals.

Inconsistencies from Insurers Contribute Equally to Accounts Receivable Days

While hospitals and providers receive most of the attention and, ultimately, the responsibility for cleans claims submissions and avoidance of revenue cycle collections, data suggests that inconsistencies on the insurers’ side are equally to blame for prolonged AR days.

[Read also: Do Payers Use Utilization Management to Their Advantage to Deny Claims?]

A recent study from Crowe Horwath reveals that commercial payers or insurers are creating challenges for hospitals and healthcare providers to collect payment for clinical services. Results showed significant disparities and inconsistencies in the number of days a claim sits in accounts receivable among five major national commercial managed care payers.

“Many providers focus their attention on their own revenue cycle processes with the idea that better-performing patient financial services will produce fewer payer issues. While that is true to a degree, our data shows that major commercial payers appear to have underlying inconsistencies when compared to one another that can greatly impact a hospital’s ability to collect revenue.” – Brian Sanderson, managing principal of Crowe healthcare services

Effective Claims Management Mitigates Risk of Civil or Criminal Enforcement

Efficient management of claims, denials, and billing disputes need to be handled timely to ensure civil or criminal enforcement actions are not taken against your organization.

Wait a minute, criminal action? For a billing dispute?

You heard that correctly. Bloomberg Law recently published an article in which they explain that lawyers that represent healthcare clients are encountering more actions taken against providers under investigation for health insurance fraud that was actually caused by faulty claims submissions. Furthermore, the lawyers that spoke with Bloomberg explained that these investigations sometimes are referred to law enforcement and charges of criminal fraud can ensue. Marcia Augsburger with King & Spalding in Sacramento, Calif. said to Bloomberg:

“In the last six years or so, the plans have stepped things up—supplying claims, deposition transcripts, and other documents to U.S. Attorneys and the DOJ.”

This changing landscape of healthcare billing demands that providers step up their compliance to ensure that all coding, claims submissions, and other billing requirements are being followed precisely – in order to help prevent a possible oversight in billing from being mistaken as intentional insurer fraud.

Staying On Top of Claims Management to Protect Hospital Revenue Cycle Health

Here at The SSI Group, we understand the challenges faced by hospitals and healthcare providers when it comes to clean claims rates and managing denials. We provide hospital revenue cycle management software that helps organizations accelerate reimbursement, minimize denials and establish successful core practices over the entire claim cycle via clean claims.

[Read alsoImproving Hospital Claims Denials Management]

Want to see how our robust claims management solutions can help your organization? Request a demo today.