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Situation: Billing Issues in the Healthcare Industry
Our client performs lab tests on patient "draws" of blood and other samples for doctors' offices. Every draw is called an "accession." The entire healthcare industry is notorious for insurance coverage and billing issues.
Opportunity: Unbilled charges steadily increased while cash receipts decreased...
For a variety of reasons, our client had accumulated a very large number (about 90,000) of:
- Accessions which had never been billed before, and
- Accessions which had been billed, rejected by the insurer, and never researched and re-billed.
These are known collectively as "unbilled accessions" and were having a material negative impact on cash flow.
Resolving unbilled accessions usually requires research by the Billing staff, and then follow-up to personnel in the physician office – whether Administration, Medical Records, or the Technician who performed the draw – to review the claim, describe the issue, and request additional information. This is a labor-intensive process for both our client and the physician offices.
Our client decided to dedicate its internal Billing staff – fully during the week, and also working some weekend days – to working down the unbilled accessions, and backfilling the regular Billing staff with temporary staff. Even with this brute force approach, reducing the unbilled accessions to normal levels would not be completed in the timeframe needed by our client. In addition to the volume of unbilled accessions, they were quickly approaching the health insurers' 180-day "timely filing" deadline for many of these claims – which meant they would not be able to resubmit those particular claims to the insurance company for payment.
At the start of the year, the unbilled accessions (charges) were ata normal level of about 10,000, yet began increasingby 8,000 to 9,000 per month for the next nine months.As unbilled accessions steadily increased, cash receipts steadily decreased.
Solution: Create a list of Priority Items, and develop a plan to address those issues.
We worked with our client's Billing, Call Center, and Information Systems personnel to develop a number of process-related and technology-related ideas to improve the productivity of their Billing staff. We then estimated the approximate cost and impact of each idea, ranked it by priority, and presented all these for management consideration.
Management agreed with our top priorities and tasked us with working to implement them quickly. We did so, designing and developing several technology tools and rolling these out over a six-week period. We then monitored the impact of these tools on staff productivity and impact on reducing the inventory of unbilled accessions.
Priority List
We developed a list of over 24 ideas, grouped by functional area, to reduce unbilled charges – and, more generally, to improve the entire order-to-cash process. Some of these ideas were "quick hits" meant to address the unbilled charges, while many were medium-term to longer-term ideas meant to reduce the potential for denied or rejected claims – which create rebills – by error-proofing all steps prior to the initial billing.
To help management quickly understand why we gave a particular idea a certain priority ranking, we created a color-coded table plotting the ideas against both their estimated cost and anticipated impact.
Results & Benefits: Unbilled accessions dropped by nearly 40%, and stayed at acceptable levels.
Within three months, the level of unbilled accessions dropped nearly 40% and brought in several hundred thousand dollars of cash – just in time for our client's year-end.
Subsequent to year-end, our client went back to its normal staffing for Billing. We then implemented additional ideas which allowed the regular staff to reduce unbilled accessions to acceptable levels.
Conclusion: The combination of Force and Finesse paid off
Combining additional personnel with enhanced technology allowed our client to quickly meet their timeline and cash flow targets.
To discuss how this type of project could be applied to the issues facing your business, call us at 336.297.4200 to schedule a no-obligation consultation.
