In this webinar, learn new strategies to approaching claim rejections and underpayments and how to adopt best practices and leading solutions related to denials.
Category: For Hospitals & Physician Groups
Stay informed on the latest industry news, best practices, and trends in revenue cycle management for hospitals and physician groups.
How Your Payer Dictionary Can Impact Your Clean Claim Rate
Many business offices, working toward an optimally efficient, cost-effective claims process, set a Clean Claim Rate (CCR) goal of at least 95%. A high CCR means less time and expense associated with getting accurate charges billed as soon as possible following the discharge of services.
| Clean Claim Rate (CCR), the ratio of claims that pass edits cleanly—not requiring any correction or manual work prior to transmitting to payers—is an important indicator of your revenue cycle performance. A high CCR generally demonstrates that at each point through the revenue cycle to the point of claim creation, data collection has been accurate and efficient. |
Procedure and diagnosis coding, modifier use, and compliance with medical necessity rules are a few of the common trouble spots that can negatively impact CCR. One that often goes unnoticed is the state of your payer dictionary.
Insurance information entered during patient intake may or may not match an appropriate entry in your system’s payer dictionary. Claims entering your system with an unmatched payer name will cause a drop in your CCR and payment delays. Worse, claims that have been tagged with the wrong payer identifier can result in rejections, denials, incorrect reimbursement, or even unauthorized PHI disclosures.
Is potential revenue leaking from the holes in your payer dictionary?
Plug the holes by keeping your payer dictionary up to date and your claims matched accordingly with regular weekly maintenance. When matching or confirming insurance payer entries to each appropriate payer dictionary entry:
- Be certain to match, in every instance possible, to a payer ID set up for electronic claim submission. Sending claims on paper unnecessarily is too often the result sloppy payer matching. One consequence will be delayed payment; a lack of tracking on either the claim or payment may also result.
- Confirm that the payer ID is a perfect match, so that the right claim edits are applied and the claim will be submitted to the correct insurance payer.
- Choose to apply Medicare edits for a commercial payer’s Medicare product, or Medicaid edits in the instance of a commercial payer’s Medicaid product. If the only edits applied are those that would be appropriate for the payer’s commercial plans, important rules could be missed that could result in rejections, denials, or incorrect reimbursement.
- Don’t forget to select whether or not “shadow” or information-only claims should be generated to the MAC when a Medicare Advantage plan is being billed for inpatient services.
- Link your payer entry to the appropriate Line of Business so that the ANSI 837 Filing Indicator will be correctly completed in the claim that goes to the payer.
Having the correct payer designated by your system when a claim is generated is critical to making the most of the claim edits library in your claims management system. Payer specificity is key to 2 of the 5 “Must Haves” for a high-quality claim edits library. When that library includes all of the Five Must Haves—the success of your high CCR will be amplified with a high First Pass Rate (FPR) for the fastest, most reliable cash flow possible.
Read about all 5 of the Must Haves for Your Claim Edits Library in our latest e-book. Or, to hear more about how the Quadax FPR of 99.6% can improve your cash flow, get in touch—we’d love to talk.
Changing the Course of Revenue Cycle Management in 2019
We’ve come to the end of another calendar—each year the ride seems to go faster! With the holidays upon us, we can count on portrayals of the Ghosts of Christmas Past, Present, and Future. It’s inevitable, too, at this time of year that the voices of our industry look to where we’ve been, where we are, and where we’re going in healthcare.
The challenges of revenue cycle past continue to haunt us, and are certain to only become more urgent in the near future. The long list includes:
- Financial pressures due to shrinking margins
- Revenue leakage through denials, underpayments, and uncompensated care
- Poor patient engagement, particularly in this era of patient-as-payer
Moody’s forecast for the nonprofit healthcare sector is gloomy; “its 2019 outlook will remain negative for the next 12-18 months.” Flat or declining operating cash flows and a rise in bad debt are cited as two of the issues contributing to the projection.
Enrollment in high deductible health plans continues to grow, causing patient responsibility to often exceed the patient’s ability to pay.
While the costs of uncompensated care did decline between 2013 and 2015, the trend since then has been upward. “According to Definitive Healthcare data, hospital bad debt totaled nearly $80 billion in 2017, with an average bad debt to net patient revenue of just over 25%.”
A list of the negative prognoses could go on and on, and like Scrooge, we want to shout, “Haunt me no longer!”
The challenges are all too familiar, but as they grow in magnitude it becomes clearer that they cannot be solved by relying on the same old strategies and tactics.
With that in mind, Quadax has been working diligently this year on new real-world solutions to some of our clients’ biggest revenue cycle obstacles, and we’re excited to bring those forward in 2019. The first of these, Decision Intelligence, will launch early in the year. Data abounds in the provider business environment—but how do you use it effectively to alter the course of projected doom? Decision Intelligence by Quadax is the tool you need to leverage actionable data—to gain insight, to achieve efficiency gains, and to improve financial performance.
A highlight for January will be the Quadax webinar, “Denial Management was last year. 2019 is about Denial Disruption Solutions.” Our presenter is Lyman Sornberger, CEO and President of Lyman Healthcare Solutions, LLC. Mr. Sornberger has thirty years’ distinguished executive experience, and he will share the future of healthcare denial management—the new world of denial disruption.
Ebenezer Scrooge observed to the Ghost of Christmas Future that while a course may foreshadow certain ends, if the course is changed, the ends will change, as well. In keeping with our mission, Quadax is determined to change the course of revenue cycle management to help providers gain control and improve outcomes with new approaches to tackling the issues of the past, present, and future.
As we enter the holiday season and prepare for new things to come, all of us at Quadax are thankful for another year of working with our clients and partners and working alongside our colleagues and friends. We wish you and your families great joy and peace in all your celebrations.
Cheers!
Five Must-Haves for Your Claim Edits Library
This e-book describes the five essential elements of a claim edits library that will positively impact your cash flow.
Is Your Cash Flow Engine Running at Peak Efficiency for Reimbursement?
Claim processing rules are the power behind your cash flow. The tool you use for scrubbing and submitting your claims is only as good as the library of claim edits under the hood that will identify errors before you submit – giving you the opportunity to send clean, error-free claims.
Five essential attributes for the claim edits library that will improve your cash performance are identified in the new e-book by Quadax, Five Must-Haves for Your Claim Edits Library.
The first Must-Have is a comprehensive set of payer-specific billing policy edits, validating claim data for all your claims: Medicare, Medicaid, and commercial. Claims for Medicare or Medicaid managed care products administered by commercial payers may require the application of standard government policies with a twist — the payer’s own unique additions or restrictions. Make sure that each of these rule sets are included in your claim edits library:
For Medicare claims:
Medical necessity policies, local and national. Local Coverage Determinations (LCD) are published by your Medicare Administrative Contractor (MAC), and National Coverage Determinations (NCD), are published by the Center for Medicare & Medicaid Services (CMS). These govern which services are considered medically necessary, and therefore reimbursable, for Medicare beneficiaries based on the diagnosis for which they are being treated. As you know, if a service you’ve provided does not meet Medicare’s medical necessity standards, you may have just provided that service for free (unless you have an Advanced Beneficiary Notice [ABN] signed by the patient prior to the service delivery). Medical necessity policy watchers are presently observing the impact of the 21st Century Cures Act on LCD compliance. The Act, intending to improve transparency in the LCD process, prompted a change to the Medicare Program Integrity Manual. International Classification of Diseases, Tenth Revision, Clinical Modification (ICD-10-CM) and Current Procedure Terminology (CPT) codes are moved out of the LCD documents and into billing and policy articles published alongside LCDs in the Medicare Coverage Database. Your claim edits library must be up to date with every policy, every ICD-10-CM code, and every CPT code, whether published in NCDs, LCDs, or separate billing policy articles.
National Correct Coding Initiative (NCCI). CMS developed the National Correct Coding Initiative (NCCI) to promote national correct coding methodologies and to control improper coding leading to inappropriate payment. Two subsets of NCCI are PTP and MUE.
NCCI Procedure-to-Procedure (PTP) code pair edits prevent improper payment when certain codes are submitted together.
NCCI Medically Unlikely Edits (MUE) indicate the maximum number of Units of Service (UOS) allowable under most circumstances for a single Healthcare Common Procedure Coding System/Current Procedural Terminology (HCPCS/CPT) code billed by a provider on a date of service for a single beneficiary. Corresponding MUE edits are similarly implemented within the Fiscal Intermediary Shared System (FISS) for Part A claims.
Outpatient Code Editor (OCE) edits. This set of rules was developed by CMS to examine outpatient facility claims and identify incorrect and inappropriate coding. The OCE also incorporates NCCI PTP edits. The OCE as used by Medicare contractors also assigns APCs, payment indicators, etc. By applying OCE edits and correcting where necessary prior to transmission, clean claims may be processed much faster, and reimbursed faster, by Medicare.
Coverage Validation edits. These edit routines compare Medicare beneficiary data on claims with the official Medicare data in HETS (the HIPAA Eligibility Transaction System) prior to claim submission to identify any shortcomings to the exact name match needed for claim processing, as well as eligibility, therapy thresholds, max occurrences per year for certain procedures, etc.
For Medicaid claims:
Coverage Validation edits. Similar to coverage validation edits for Medicare, these edit routines query the state Medicaid information systems in real time. They can therefore overcome the biggest challenge when filing Medicaid claims, which is identifying eligibility: verifying coverage at any given point in time; verifying coverage by a Medicaid managed care organization rather than traditional Medicaid, or verifying an identification number. Coverage validation edits running during claim edit routines in the claims management system prior to claim submission can head off eligibility issues that will delay, if not completely obstruct, reimbursement.
Billing policy edits. Specific billing policy rules are common for commercial Medicaid products and vary by payer. These rules are not likely to be published in neat packages, reinforcing the need for diligence and tenacity to discern and confirm the policies and keep them up to date.
Medicaid NCCI. Since 2010, state Medicaid programs have been required to incorporate elements of NCCI into their claims processing systems: PTP and MUE edits for practitioner and ambulatory surgical center (ASC) claims; PTP and MUE edits for outpatient hospital services including emergency department (ED), observation care, and outpatient hospital laboratory services; and MUE edits for durable medical equipment (DME) billed by providers. In 2012, PTP edits for DME were added to the mix. The Medicaid NCCI is slightly different from the Medicare NCCI manual and is therefore maintained separately.
For Commercial claims, including Blues:
Reimbursement Policies. Policies that may be considered the counterpart to Medicare’s NCD and LCD are published by commercial payers to provide guidance in interpreting the payer’s benefit plans, without addressing every aspect of a reimbursement situation. Policies may be applicable by product, by treatment setting, by state, or they may be blanket policies covering all of the payer’s products to one degree or another.
Commercial application of NCCI. Many commercial payers take advantage of NCCI rules, or a subset of them, in their own claim processing routines.
Claim edits libraries are not all the same. Quadax clients have an edge when it comes to claim processing because of the Quadax EDG: the Edits & Documentation Group. The work of the EDG differentiates Quadax as the leader in claim editing because of its diligence to provide each of the five claim edits library essentials discussed in the free e-book, “Five Must-Haves for Your Claim Edits Library.” Request a copy today to read about the other four Must-Haves and learn more about the Quadax EDG.
Keep your cash flow engine running at peak efficiency and optimal performance with the powerful claim edits library of Xpeditor, diligently maintained by the Quadax EDG!
Ensuring the Revenue Cycle Gets a Clean Bill of Health
Featured in HFM Magazine, this article by Eric Matson (Director of Product Development at Quadax) discusses the preventive action required to create clean claims and reduce denials.
RemitMax and Adena Health System
Learn how Adena Health System dramatically reduced workload and expenses by optimizing their paper remittance processing using RemitMax by Quadax.
Why Month-End Cash Posting is Scarier than Halloween
For a cash posting manager, Halloween’s got nothing on the horrors of manual splitting, posting, and reconciling remittances.
Skeletons and ghouls are not nearly as frightening as an impending month-end with all your posting staff working overtime to post and reconcile receipts. Needing to resolve a patient payment issue but not having a way to efficiently look up all payments posted to the patient’s account—that’s a lot more anxiety-inducing than a haunted house.
Before Adena Health System began using RemitMax™ by Quadax, the staff spent a lot of time printing and scanning lockbox documents, because the bank only retained three months’ worth of correspondence and paper remittance data. Paper documents waiting to be scanned filled cabinet after cabinet, which delayed insurance follow-up work, delayed answers to customer service questions, and also delayed cash posting. Referencing the source documents to solve any posting errors meant combing through the cabinets armed with the deposit date of the batch. If the deposit date had been entered into the scan incorrectly, they would likely never find the document, since that was all they had to search by.
Now that’s a horror story.
Implementing RemitMax at Adena Health System brought about numerous improvements for the entire business office. One of the early wins was the document retention, the excellent search functionality, and the elimination of the perpetual printing and scanning of paper remittances and correspondence by Adena staff. Another was the ability to reassign staff to more valuable follow-up work because of the huge time savings that RemitMax has helped them realize with automatic splitting and electronic posting.
Angela Lowery, Cash Posting Revenue Cycle Manager at Adena Health System in Ohio, will be discussing revenue cycle life before and after RemitMax when she presents “Transforming Remittance Management into a High-Performance Operation,” a live webinar on Thursday, November 1, 2018, at 2:00 p.m. (EDT).
Angie is enthusiastic about the difference that RemitMax has made in the entire business office at Adena Health System—for lockbox savings, for morale, for improved customer service, and for better follow-up and the opportunity for revenue recovery. Join us to hear more about Adena’s transformational experience with RemitMax by Quadax!
To read more about RemitMax, download the e-book, Surviving the Paper Storm. If you would like to learn how RemitMax can transform your business office, Request a Demo!
Hanging in the Balance: Addressing Surprise Billing Issues
The topic of balance billing is in the news again, closely associated with the newer term, “surprise billing.” Patient experiences such as those of Drew Calver, who received an unexpected $109K bill following treatment for his heart attack, have focused new attention on this long-standing issue.
Balance billing is the practice of pursuing from the patient any balance remaining on account after the insurance payer has reimbursed its portion to the provider, beyond the expected co-pay, co-insurance, and deductible. The terms of the contract between the provider and insurance plan will generally dictate what is or is not billable to the patient – the aforementioned co-pay, co-insurance, deductibles, for example – and these contract provisions (and state law, typically) will control whether or not a patient may have further financial responsibility.
When there is no contract, of course, all bets are off, since an out-of-network provider has no negotiated payment rate. As high-deductible health plans have become more widespread, many patients are keenly aware of the benefits of staying in-network to keep those expected costs as affordable as possible. But what about when services must be rendered by an out-of-network provider?
In a number of cases highlighted by the media recently, a patient was not aware that out-of-network providers were engaged in the treatment. This commonly happens when an emergency department physician working through a staffing agency, or an anesthesiologist or radiologist is involved in care but is not in-network. Hence, the surprise of “surprise billing” – the receipt of an out-of-network bill when the patient thought they were at an in-network facility.
New Jersey’s Assembly Bill No. 2039 has likewise garnered quite a bit of attention since its enactment and particularly since its effective date August 30, 2018. Governor Phil Murphy, who signed the legislation earlier this year, said “We’re closing the loophole and reining in excessive out-of-network costs to prevent residents from receiving that ‘big surprise’ in their mailbox. At the same time, we’re making healthcare more affordable by ensuring these costs are not transferred to consumers through increased health premiums.”
New Jersey is among 21 states that have partial or comprehensive protections against balance billing by out-of-network providers in emergency departments or in-network hospitals. Stipulations of the protections vary by state. Variables include applicability by setting, type of managed care plan, the type of protection, and the payment outcome, whether a payment standard or a dispute resolution process. And since ERISA currently exempts self-funded employer sponsored plans from state regulation, 61% of privately insured individuals are not covered by their state’s protections, adding to the complexity.
There is speculation that changes could be made to ERISA (the Employee Retirement Income Security Act of 1974) to overcome this loophole to state protections. Senator Bill Cassidy, M.D. (R-LA) announced on September 17 a discussion draft of a bill that would modify ERISA to defer to state limits for patient costs for emergency care; or, in absence of state limits, define restrictions within the proposed legislation itself to cap patient responsibility. This is one issue among several concerning healthcare price transparency that is being discussed by a working group, and not the only discussion on the topic of potential laws governing balance billing.
So what’s a healthcare provider to do?
- Be aware of the regulations applicable in your state, and be prepared to comply. As media focus continues on this topic, more legislators are taking up the issue. Stay tuned to your state’s law-making process to eliminate surprises for your cash flow.
- Apply your organization’s payment policies consistently.
- Communicate clearly with patients, whenever possible, about the charges they should expect and their options for payment. In non-emergency settings, check patient eligibility, and provide a pre-service estimate based on their health plan coverage.
Complex billing issues are par for the course in today’s healthcare business office. That’s why Quadax delivers software and solutions that solve revenue cycle complexities, streamlining accounts receivable and reimbursement operations to improve cash flow and payment results.
If you’re ready to work with a partner that believes in transparency, communication, and earning our clients’ trust every day, get in touch with Quadax!
Collect More Revenue with “Clean” Claims
When it comes to healthcare claims, cleanliness is next to, at the very least, fiscal fitness. Producing claims that are “clean” and therefore immediately reimbursable is an important factor in reducing cost-to-collect, especially in an environment where the growth of costs (7.5%) are outpacing revenue (6.6%).[i] While some denials are inevitable, reducing your denial exposure is all about producing claims that can be paid, and can be paid now.
Two metrics important to the discussion of creating claims most likely to be immediately reimbursable are Clean Claim Rate (CCR) and First Pass Rate (FPR). Though sometimes confused for one another, these are separate statistics, each worthy of optimization.
HFMA identifies the value of CCR as an indicator of the quality of data collected and reported. This measure is captured through your claims processing tool, and is calculated as the number of claims that pass edits requiring no manual intervention divided by the total number of claims accepted into the claims processing tool for billing.
A high CCR indicates that the data collected and processed by the EHR may be presumed to be high-quality. That quality may be attained in one of a few ways. Well-defined processes throughout the revenue cycle, from patient intake through coding on to accurate claim production processes in the EHR, will be reflected in a high CCR. Another way to achieve a high CCR is by applying a meticulous routine of incoming claim data conversions within the claim processing tool to overcome EHR shortcomings and human error. Or, a combination of both factors may be in play. In any case, the effect is faster time to payment with reduced manual labor for reduced operational expense.
Another important metric is the first-pass rate (FPR): the percentage of claims which are accepted for adjudication by payers on the first transmission. This measure indicates the reliability of your claims management system: the quality of its claim editing routines is critical; so is the accurate generation of 837s to meet each payer’s unique specifications, including the correct placement of each data element. The most common reason for claim rejections is missing/incorrect data. By catching those errors – and even better, by facilitating automated correction of such errors – the claim processing tool with a high first-pass rate also contributes to faster time to payment, and impacts manual labor expense by reducing manual correction and resubmission. For a provider processing 100,000 claims per month, a variance as little as 1% in your first-pass rate can mean an additional 1,000 claims that must be manually reviewed.
Some organizations make the choice to abandon the pursuit of an exceptionally high CCR in favor of moving claims out the door as quickly as possible. Follow-up staff must then be mobilized to handle the resulting rejections (bounced back to the clearinghouse with errors flagged, never having made it into the payer’s adjudication system) as well as denials. Other organizations choose to weight the process at the billing stage, examining every claim prior to release to head off the potential for follow-up work down the road.
An imbalance favoring either manual pre-work or post-work is likely to add to the cost of claims management. Greater value can be realized by balancing quality and quantity with a holistic approach to creating cleaner claims and reducing denials that incorporates intelligent efficiency and automation.
In summary:
- Work toward data accuracy throughout the revenue cycle to contribute toward a higher CCR.
- Make use of automation in your claims management tool to apply data conversions to overcome known shortcoming in your system or process during claim intake to achieve an even higher CCR.
- Rely on a clearinghouse with a high FPR, like Quadax, to get your clean claims into adjudication as quickly and reliably as possible.
Learn more about streamlining your claims management process in our free infographic that cues you into Roadblocks, Pile-ups, and Bottlenecks in Claims Processing.
Would you like to learn how much improvement your business office would see with an improved CCR and an industry-leading FPR rate? Click here to get in touch with us – we’d love to talk!
[i] “Moody’s: Preliminary FY 2016 US NFP hospital medians edge lower on revenue, expense pressure,” Moody’s Investors Service, May 16, 2017. https://m.moodys.com/research/Moodys-Preliminary-FY-2016-US-NFP-hospital-medians-edge-lower–PR_366813