The complexities of insurance make it difficult for practices to get paid quickly. To minimize issues in cash flow, you can use benchmarking to get ahead of problems caused by delayed payment.
“The check is in the mail.”
Even with rising premiums that increase patient responsibility, the bulk of fee for service reimbursements still come from payers. In the past few decades, billing a patient directly at the time of service has been replaced with your office staff seeking payment from multiple insurance companies. And as dealing insurance has become increasingly more complex, so too has the opportunity for a claim to be rejected and your practice to go unpaid.
Understand that insurance companies are like any other financial entity, any gap between cash inflows and outflows presents an opportunity to invest for short-term interest or drive additional margins to report to investors. Ultimately, payers benefit from not paying you quickly.
This can cause problems, as any delay or loss in payment can present challenges in managing the revenue cycle of your practice. At a minimum, delays in payment can make it difficult to accurately predict cash flow. At its worst, it creates stress over just keeping the lights on and can potentially lead to burnout. Finding ways to mitigate any delays or lost payments from payers requires an understanding of what behaviors or patterns to look with payers.
Benchmarking levels the playing field.
Trying to identify a pattern of delayed payments from a specific payer can be a daunting and time-consuming task. This can be further complicated if you’re sourcing this information from your EHR/EPM system, which means sorting through massive amounts of often poorly organized data. Thankfully, benchmarking can provide a more pragmatic approach to tackling all of this data and the easiest place to start is against your practice’s history.
Benchmarking against yourself
A key metric to look for patterns in payer behavior is in your denials. For every 100 insurance claims you submit, it’s likely only 85-90 will be adjudicated, with the rest getting delayed or even denied. Identifying variations in denials throughout your practice’s history will help you spot trends across different offices, payers, or procedures that indicate a payer rule change. This should equip you with the necessary information to prevent further denials for the same issue.
Another important metric to track internally is new patient growth. While new patient growth won’t uncover patterns in payer behavior, it will indicate your practice’s ability to weather ongoing rule changes that could affect your bottom line. Most practices will typically see their patient attrition grow each year due the standard excuses to reaching end of life. While seeing additional patients each day could mean an increased workload for your practice and staff, your practice must bring in new patients to stay afloat.
Armed with this information you practice has the opportunity to not only make up for losses incurred from denials and payer rule changes, but a viable path towards growth.
Dealing with insurance is a consequence of being a healthcare provider. While insurance rules continue to evolve and the gap between treatment and payment will likely never be reduced, proper benchmarking can give practices the opportunity to still thrive and grow.
If you would like to learn more about how benchmarking can help your practice grow, you can download our whitepaper: Shining a Spotlight on Insurance: Four ways your practice is losing money if you aren’t benchmarking.
If you have any questions about benchmarking or want to learn how we can help your practice you can call (301) 990-3995 or email us at email@example.com.