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Nearly 50 percent of rural hospitals in our country are operating in the red, with over 450 at risk of closure. As hospitals face regulatory and market pressures, they are focusing on areas that can have an immediate positive impact on cash flow, such as revenue cycle management (RCM).
In this blog, we explore some of the pain points in RCM related to contract management, and how to resolve them.
Hospital contract management is the process of overseeing and optimizing agreements between a healthcare organization and various stakeholders. It often involves negotiations with insurance payors, labor representatives, vendors, Group Purchasing Organizations (GPOs), and contractors.
The process of contract management includes negotiations, creation, implementation, monitoring, and maintenance of these contracts to ensure financial viability, efficiency, and compliance.
Managing this process can be complex and time-consuming. When organizations are experiencing staffing shortages, or operate with a smaller team, it can be easy to let contracts re-up without review, put maintenance on the back burner, and neglect other important aspects of the contract management process.
Effective contract management is essential for healthcare organizations to establish financially beneficial relationships with their stakeholders. Well-maintained and expertly negotiated agreements help ensure that organizations receive appropriate reimbursement for services, helps maintains good relationships with partner organizations, prevents unnecessary legal risks, and supports overall financial stability. Unfortunately, providers spend approximately $157 billion annually on less-than-optimal contract management.
Maximizing reimbursement should be a well-governed, ongoing pursuit. Established steps, including workflow automation, a centralized document repository with audit tracking, linking to regulatory and policy documents, and proper representation in the development team can help to cut down on these costs while simultaneously ensuring more revenue is flowing back into the facility.
Conventional wisdom states that “a contract will perform as well as you let it.”
A hospital may believe they have negotiated a fine contract, but without an effective means of payor and contract monitoring, it can be a challenge to know if that’s really the case. A contract may be performing particularly well for a period and then start realizing occurrences of specific types of denials, down-coding, or underpayments. At an average cost of $118 per appeal, this can be a significant drain on resources.
Effective analytics and performance monitoring can provide critical insight to prevent denials, including:
A transparent approach should also allow you to see underpayment variance trends, understand insurance payor agreements, and anticipate where issues may arise in the future.
MEDTEAM supports healthcare organizations in negotiating, building, updating, and maintaining contracts that include favorable rates and terms. Moreover, they provide payment variance analysis and recovery services, meticulously identifying reimbursement variations and collaborating with clients to pinpoint underlying causes. This strategic approach ensures that no revenue opportunities are left untapped.
To learn more about how MEDTEAM supports effective contract management, please reach out to us at inquiries@medhost.com or call 1.800.383.6278.
As part of its commitment to rural and underserved populations, CMS now gives existing rural hospitals and CAH facilities the option to adopt Rural Emergency Hospital (REH) Medicare provider status to receive additional federal assistance.
But with new regulations and unprecedented growth in secondary healthcare, many would-be REHs are struggling to effectively link clinical systems to an increasingly complex financial workflow.
This post covers the specific business office services that MEDHOST can deploy to help ensure that rising patient volumes and increased revenue cycle demands don’t disrupt these facilities' efforts to provide lifesaving, value-based care for their communities.
Rural Emergency Hospitals are filling a major void in their communities.
While Freestanding Emergency Rooms (FSED) have dramatically increased access to care, they haven’t been effective in meeting the needs of rural populations. In the last 25 years, demand for rural emergency care has grown at the same rate that non-rural hospital emergency departments have closed, according to The Journal of the American Medical Association.
Having fewer resources and staff, the business offices of smaller healthcare facilities are often under considerable pressure to reduce the amount of time accounts are overdue, ensure positive cash flow, recover missing payments and identify billing errors. With these competing responsibilities, it’s not uncommon for bottlenecks to form.
Working closely with facility staff, MEDHOST leverages an in-house team of business services experts to overhaul facility accounts, root out the areas where revenue had been left on the table, and sketch out a roadmap for manageable, sustainable growth.
Before collaborating with MEDHOST, our business office services experts find that many hospitals have been making small errors in billing visit codes, which can add up on a hospital’s balance sheet over time.
The culprit behind these billing mistakes is often one endemic to healthcare back offices: outdated practices. In an industry obsessed with protecting patient data, the security associated with these manual processes—such as mailing patient statements and bills— has kept healthcare in the dark amid a revolution in digital-first business practices.
Another challenge that we identify when working with hometown providers are the complexities surrounding the management of charge masters. The chargemaster—a list of billable items and services the hospital provides—can only be increased to a certain degree before payers want to be notified. This allows insurance companies to renegotiate contracts if facilities implement significant changes that might impact payments.
It’s in the best interest of the hospital and the payers to negotiate and maintain mutually beneficial agreements. Hospitals that fail to keep insurance in the loop risk underpayment and other billing errors.
Understanding the expectations of payers, knowing when and where to come to the table over these contracts, and managing the financial benefits and risks of chargemaster increases, requires years of contract management experience and may be difficult for smaller hospitals that lack the experienced RCM staff of larger providers.
It’s not uncommon for facilities to have a backlog of unprocessed claims. Traditional account follow-up can be a pain point, especially at small to midsized hospitals. With the pressure of day-in-day-out responsibilities, it becomes easy to put old accounts on the back burner—especially when staffing challenges complicate the process.
Without knowledgeable and experienced billing experts scrutinizing claims, hospitals are often forced to rely on insurance companies for accurate reimbursement. Unfortunately, payers are incentivized to compensate hospitals as little as possible or deny claims entirely.
As an extension of the hospital’s existing team, MEDHOST can help maximize payments by building and maintaining existing agreements, attaching them to the correct payer plans, flagging inaccuracies, and overseeing the recovery process from start to finish.
Streamlining the revenue cycle to meet the demands of today’s business environment can be a daunting task. Regulations, inflation, rapidly evolving markets and stubborn workforce challenges only complicate attempts to improve business operations. But by teaming up with a dedicated revenue cycle management partner, your business office can access the tools and expertise they need to fix leaks and get revenue flowing again.
Want to learn more about how MEDHOST can help your facility accelerate the revenue cycle? Get in touch with us at inquiries@medhost.com or call 1.800.383.6278 to learn more.
People tend to get attached to initial impressions and often find it difficult to change their minds, even when presented with incentives or evidence to the contrary.
Consequently, it's important for healthcare providers to be aware of how they come across to patients during an initial meeting and how it can impact patient service revenue.
These instances are an opportunity to deploy patient access services and solutions—reviewing and modifying any irritating parts of the front-end experience and accentuating strengths—to ensure that people leave the hospital with a favorable opinion they'll share with others.
Every part of front-end processes, from scheduling to benefits verification, can be adjusted to generate a better patient encounter, improve patient satisfaction scores, and drum up more business.
Many people think revenue cycle management (RCM) primarily occurs during hospital back-end operations, but early-stage patient engagement can make or break an organization financially. This is where patients book and register, form their first impression, and witness how others are received and treated by staff.
Training front-end personnel in appropriate data processing and giving them the proper tools to improve the patient experience is essential to creating a positive first impression at your facility.
Beyond the importance of a good experience for patients, the errors occurring on the front end of RCM can easily pop up later when collecting from insurers and patients. From the first interaction, front desk staff should think of how they can best set the hospital and patient up for billing success.
The financial portion of the patient experience begins well before discharge and includes the following:
Favorable impressions rarely start with long stretches in a waiting room.
Patient pre-registration—collecting data such as names and medical histories—can become tedious when manual, on-site processes are the only option. Software that allows for pre-enrolment helps streamline throughput, cut down on clipboard time, and ensures a better user experience.
Having patients fill out paper forms isn't just unpopular and time-consuming, it's a significant driver of denials. According to research by 3M, nearly a quarter of all claims denials are caused by registration errors.
When you consider that over half of denied claims are never revisited, this oversight adds up to a significant amount of lost revenue happening before a patient ever sees the exam room.
Many hospitals still use manual administrative and clinical functions to handle scheduling. This can include paper calendars, whiteboards, or excel spreadsheets. These methods are prone to errors, which can add up on a hospital's balance sheet over time.
For instance, when practice management software that includes alerts and automated reminders isn't part of a facility's scheduling process, it's more likely that patients will miss appointments. While this may seem like a minor issue, one study found that for each no-show or missed appointment, a hospital loses, on average, over $200.
A scheduling platform gives registrars intuitive electronic systems to use, it is easier to train current and future staff on, leadership can set standards, and software providers can receive feedback that drives continuous improvement. Ditching manual processes is also a good way to reduce healthcare worker burnout.
Eligibility and benefits verification is another critical component of revenue cycle management. When this process is standardized and efficient, revenue cycle management staff can quickly verify income, policy coverage, and benefits, helping to prevent fraud, denied claims, and protect vulnerable community members from incurring unnecessary debt.
For instance, registration staff might miss that a patient's insurance doesn't cover experimental procedures or understand that worker's compensation will be used. Without proper authorization from the insurance company, it is likely the hospital will not be reimbursed in these instances
If the most recent price transparency rules are confusing for medical business offices, imagine how confusing it can be for healthcare consumers.
Accurate price transparency can help circumnavigate many pre-payment issues. This is also another opportunity to let the patient know that prepayment is an important part of the care process, not just a transaction. MEDHOST Price Transparency helps you not only meet regulatory requirements but also helps increase patient satisfaction by helping to eradicate stress and confusion around anticipated costs.
By preventing errors on the front end of the revenue cycle, hospitals are often less likely to encounter issues on the back end.
MEDHOST works alongside providers, enabling them to promote a positive front-end experience through EHR-based software and services that allow providers to meet the technological expectations of patients and move closer to a value-based service model.
By implementing revenue cycle management leading practices and solutions, we can help add accuracy and efficiency to patient intake, billing workflows, and payments while increasing customer satisfaction.
If you would like to improve your revenue cycle today, get in touch with us at inquiries@medhost.com or call 1.800.383.6278 to learn more.
In more ways than one, Nashville is a healthcare city masquerading as a mecca for country music fans. Rural themes, woven together with a penchant sound, define the songs that put Broadway on the map; but beyond the honky-tonks, some of the biggest names in medicine work day in and day out at the epicenter of a growing national health crisis: rural hospital closures.
According to a recent Becker's Healthcare Review that identified 220 rural hospitals at risk of closure, Tennessee—home to MEDHOST HQ—is at the top of the list. Despite serving as the country's nerve center for health system innovation, our state is projected to have as many as 44% of its rural hospitals shut their doors.
Representing approximately 10% of the US healthcare infrastructure, these facilities provide needed care for rural communities and serve as a bulwark for hometown economies. The ripple effect of rural hospital closures can impact every aspect of the populations they support, many of which already contend with poorer health outcomes and lower incomes than urban areas.
According to the American Hospital Association, a lack of skilled workers, staff, and nurses is among the primary factors behind rural hospital closures. Without the ability to fill critical roles, these facilities often lack the expertise or resources to provide necessary healthcare services, negotiate contracts, process claims, and optimize operations, resulting in a constant struggle to maintain patient satisfaction and an adequate flow of revenue.
While outsourcing operations may seem like an obvious answer to staffing shortages, it presents a unique host of problems for the close-knit community at rural hospitals. Many staff and clinicians at these facilities have lived in the area their entire lives. Some were born down the hall from where they now work. The value they bring, and preserving their place within that care continuum, can become complicated when a third party becomes involved.
What's worse, most traditional outsourced revenue cycle management has proven to be a disappointment for hospital leaders. From higher claim denial rates to longer patient collection cycles, many third-party vendors promising improved financial performance have left their customers underwhelmed and in the lurch.
Fortunately, not all revenue cycle governance is created equal. As unique and innovative approaches to revenue cycle management emerge to contend with this ongoing crisis, rural providers have access to new avenues of financially beneficial collaboration.
Rural providers don't need to choose between outsourcing and in-house staffing. Business partners should share in the risk and resources to ensure positive outcomes. A hybrid model, which combines outsourced expertise, and preserves in-house assets, is the key to solving rural staffing shortfalls while preserving the essential character of these providers.
Integrating people, processes, and tools in one or more areas of revenue cycle, IT, and cybersecurity, rather than replacing staff, helps protect and improve the investments of rural health providers. Through measured and managed alignment, communication, and transparency, the collaborative teams of hospitals and providers can reduce operating costs and improve short- and long-term financial outcomes.
MEDTEAM Services are part of MEDHOST and provide a wide range of services designed to improve cash flow and alleviate the burden of maintaining subject matter experts (SMEs), systems, and technology.
We specialize in claims management, focusing on claims submission, account receivables (A/R) management, and insurance reimbursement. We also offer contract management services, which include payor reimbursement variance analysis and recovery, the processing of patient statements and letters, online bill payment services, and custom reporting.
To find out how MEDTEAM is helping rural hospitals and healthcare facilities overcome workforce shortages while preserving their community of care, email us at inquiries@medhost.com or call 1.800.383.6278.
The University of North Carolina's Cecil G. Sheps Center for Health Services Research recently concluded that approximately 184 rural hospitals have closed since January 2005. Visitors to UNC's website can view these closures on an interactive map.
With the rate at which community hospitals are shutting their doors, protecting the bottom line has become critical to providing for community health needs and protecting hometown economies.
As a dedicated business services partner to rural hospitals across the United States, MEDHOST provides several ways to enhance hospital leadership's productivity and decision-making capabilities. Specifically, we can help encourage quick returns by focusing our efforts in three critical areas:
Despite breakthroughs in medical technology and a decreasing number of uninsured patients, hospitals continue to struggle with getting paid the right amount for the right services at the right time. Denials are a widespread and chronic issue, with one out of every five claims being delayed or refused. The issue is so pervasive, many smaller providers have given up on denial follow-up altogether.
Fortunately, there are leading practices that healthcare administrators can deploy when attacking denials, regardless of an organization's size. First, hospitals need the right tools to analyze revenue cycle data and uncover the root causes of denials. Next, input from subject matter experts is necessary to help create an action plan that addresses those issues.
Leveraging EHR software with analytics capabilities, as well as the support of business services experts, can help prevent denials by automating claims review to ensure data is accurate and complete before submission, flagging outstanding claims for follow-up, and providing opportunities to correct inaccurate or missing data through an expertly governed process.
Another way to reduce the likelihood of denied claims and help ensure maximum reimbursement from payers is to regularly review contracts and track whether reimbursements match expectations.
For smaller hospital A/R teams, however, contract management is often a serious challenge, especially if they're relying on disparate or manual tools. The other issues are experience and expertise. When contracts are updated without the scrutiny of a seasoned negotiator, hospitals risk forfeiting complete reimbursements due to changing codes or vague contract language that payers use to their advantage.
The longer a hospital waits to address these underpayments, the less likely it is to recover missing revenue. A robust contract management tool that works seamlessly within the hospital's EHR can streamline this process, provide oversight of contract maintenance, support underpayment tracking, and help improve cash flow.
The longer it takes for a hospital to go from care completion to reimbursement collection, the more risk there is for cash flow leaks. To prevent money from slipping through the cracks, hospitals should take a hard look at how long claims spend in accounts receivable and identify and remedy delays as much as possible.
An effective revenue cycle solutions tool can reveal the sources of delay: provider lags in delivering documentation, A/R time to file claims, lengthy waits for payer reimbursement, missing data that results in communication loops, and whatever else may be causing bottlenecks.
MEDHOST revenue cycle solutions can improve your hospital's bottom line by streamlining and automating processes, relieving strain on staff, and extending your capabilities through an ongoing partnership.
If you would like to improve your revenue cycle today, get in touch with us at inquiries@medhost.com or call 1.800.383.6278 to learn more.
Healthcare analytics is a growing field, spurred on by the need to stay ahead in tightening markets, keep pace with regulatory compliance, and harness technological innovations that demand greater and greater precision in health management.
By combining the expertise of business service professionals with robust analytical tools, like cloud-based software and smart contract management insights, hospitals can drive exceptional revenue cycle performance and improved patient outcomes.
At many rural facilities, workforce shortages and increased patient volumes often mean that process evaluation, account follow-up, and ongoing reporting are either scarce or nonexistent.
Without access to comprehensive business service analytics, it’s nearly impossible to point to current return on investment (ROI) conditions and create actionable strategies. MEDHOST YourCare Analytics™ functions as part of our expanded business services offerings, letting providers know where improvements have happened and where they still need to be made.
Hospitals spend billions on contract management every year, often using outdated processes. But without data-driven payor and contract analysis, negotiations may be leaving money on the table.
For instance, without the proper insights to guide renewals, a contract that has been performing well might become a source of denials, down-coding, or underpayments.
Critical business data that MEDHOST uses to optimize contract management includes:
Powered by the Amazon Web Services (AWS) cloud platform and its QuickSight business intelligence tools, MEDHOST YourCare Analytics gives customers valuable insights into the most critical data for their business growth and continued success.
As a part of the Amazon Partner Network (APN), MEDHOST’s innovation and development teams work closely with AWS experts to create and deploy new capabilities and enhance existing solutions.
Multi-tenant, cloud-based analytics solutions also open the door for future advancements in business analytics, including the implementation of machine learning to improve patient throughput, contract management augmented by artificial intelligence (AI), and more consumer-centric mobile applications.
To learn more about how MEDHOST can help establish actionable metrics and analytics, please reach out to us at inquiries@medhost.com or call 1.800.383.6278
