How to optimize payment processing in a healthcare practice
Embracing new software tools may help you submit medical claims more efficiently and get paid faster.
For many healthcare practitioners, getting paid in a timely fashion can be a major challenge. Between the obscure and ever-changing codes required for medical-claims processing, the review and adjustment process with insurers, the complexities around point-of-service payment systems, and direct billing, complex healthcare payment systems are enough to tax the resources of any practice.
Plus, any delay in the payment process can complicate a practice’s cash-flow cycle. Both large health systems and private practices face this issue, and it can be costly. According to a 2019 survey, three-quarters of health-system finance executives said they planned to devote at least 10% or more of their tech budgets in 2020 to revenue-cycle management analytics.
While private practices may not have the resources to pursue major IT initiatives, they may consider strategies to improve and accelerate their payment processes. Here are three tactics small practices may want to explore to get paid faster.
1. Switch to paperless claim submission
Digital practices that rely on electronic health records (EHRs) tend to deliver better and more efficient care, according to the Office of the National Coordinator for Health Information Technology. Shifting to a digital system may also increase profitability. On average, an electronic claim submission costs providers $1.45 compared to $2.37 for a manual claim, according to the Council for Affordable Quality Healthcare (CAQH).
Most medical practices have made this transition: 96% submit their claims electronically, up from 90% in 2013, according to a 2018 CAQH report. Still, some sectors of healthcare lag behind that number. For example, only 79% of dental practices file claims electronically.
There are other advantages to using electronic claims, too. Many of the software solutions can also help practices stay up to date on insurance or payment requirement changes.
2. Bump your clean-claim rate up
A practice’s clean-claim rate is the percentage of medical claims that are generated and submitted without requiring manual intervention. Industry best-practice benchmarks are that the average clean-claim rate for a practice should be above 90%, but most practices hover about 15 points below that figure. Claims that require corrections can take days to resolve and hinder your cash flow.
Improving the clean-claim rate takes effort from the entire practice. Submitting a clean claim requires:
- Correct patient registration information,
- Proper recording of patient diagnostic and services-rendered information by clinical staff,
- And the accurate coding of those services.
To do this well, bring together representatives from all areas of the practice periodically to review reports generated by your claims-management software to find out where errors and denials are occurring most often. From there, you can take steps to address those issues.
“You don't need a fancy methodology for this,” says Cliff Whitmore, senior director of national accounts at claims-management software-maker SSI Group. “It really boils down to getting all the stakeholders together and looking at the claims that weren't paid correctly and looking at how the practice could have handled it better.”
Most practices are adept at submitting clean claims for their most common services, Whitmore says, but problems may arise around the more unique cases. Reviewing incorrect claims as a team reduces confusion and allows a practice to figure out how they can be handled properly in the future.
3. Accept payments through a patient portal
Your practice likely collects revenue from two sources: Patients and third-party payers, such as insurers. Collecting payments electronically is usually the most efficient method. Plus, according to a 2018 survey, over half of patients prefer to pay electronically.
Still, paper statements are the default for providers across the industry. Switching to a digital system may help reduce your administrative workload and the time spent waiting for claims and checks to arrive by mail.
As medical claims processing has grown more complex, it carries the potential to create friction for providers and patients alike. But by embracing some high-tech tools and strategies, healthcare practices can accelerate their revenue cycles and become more efficient.