The overall goal of accounts receivable management is to achieve the shortest collection period possible. Accounts receivables, also known as patient accounts, refers to revenues generated but not yet collected. To ensure cash flow is sufficient for effective management, the medical office has the responsibility to maximize its revenue potential.
Accounts Receivable management involves nearly all areas of the medical office. Successful accounts receivable management requires a full understanding of how each area or department relates to and influences the revenue cycle and the AR collection period. Let’s explore each of the eight key areas.
Legal concepts include understanding and following state and federal regulations. The area that has always been of the most concern is fraud and abuse, especially with regard to Medicare, Medicaid, and other federally-funded programs.
Fraud refers to willfully and knowingly billing medical claims in an attempt to defraud any federally funded program for money. The most common forms of fraud and abuse include billing for equipment never provided, billing for services never performed, upcoding charges to receive a higher reimbursement rate, and unbundling charges.
The Office of Inspector General (OIG) has designed and issued special fraud alerts to the healthcare provider community. These alerts were intended to publicize the national trends of fraud to the general public. It is also a way to provide insight and awareness on fraudulent practices within the industry and address violations specific to the Medicare and Medicaid Anti-Kickback Law.
Contract negotiation involves developing a financial relationship with managed care organizations. Managed care organizations represent up to 50 percent of the net revenue of most medical offices.
Negotiating managed care contracts requires comprehensive knowledge of the contracting process. This includes reimbursement rates, effective and termination dates, claim filing guidelines, payment terms, and other contract provisions.
Each medical office contract negotiation strategy is unique and will be based on various factors, but these basic ideas should be kept in mind:
- Know the market: Do you know what percent of your market has Medicare, Medicaid, Cigna, Blue Cross Blue Shield, Aetna, United HealthCare or uninsured? A market survey provides valuable information required of all contract negotiations.
- Be realistic: Understanding the managed care environment including the various payment methods will provide you with a basis of information necessary to take a realistic approach in negotiating.
- Hire a consultant: Many organizations rely on consulting services to provide managed care contracting negotiation due to the complex nature of contracts and the legal aspects involved.
Legal counsel should be consulted on all contract issues when there are considerable and various exposures to the organizations or when contract issues are beyond the scope of the expertise of medical office leadership.
Developing a compliance program involves establishing a written manual describing the compliance policy and the Medical Office Code of Conduct. Most medical office compliance policies include both ethical and legal concepts. The OIG (Office of Inspector General) offers these seven components that provide a solid basis for a medical office compliance program.
- Conducting internal monitoring and auditing;
- Implementing compliance and practice standards;
- Designating a compliance officer or contact;
- Conducting appropriate training and education;
- Responding appropriately to detected offenses and developing corrective action;
- Developing open lines of communication; and
- Enforcing disciplinary standards through well-publicized guidelines.
The US Office of Personnel Management identifies three major objectives for the development and utilization of Patient Rights.
- First, to strengthen consumer confidence by assuring the health care system is fair and responsive to consumers’ needs, provides consumers with credible and effective mechanisms to address their concerns, and encourages consumers to take an active role in improving and assuring their health.
- Second, to reaffirm the importance of a strong relationship between patients and their healthcare professionals.
- Third, to reaffirm the critical role consumers play in safeguarding their own health by establishing both rights and responsibilities for all participants in improving health status.
There are eight key areas related to patient rights within the medical office.
- Patient information: patients have the right to accurate and easily understood information about their health plan, health care professionals, and healthcare facilities.
- Choice of providers: patients have the right to choose health care providers when they need it.
- Access to emergency services: patients have the right to emergency medical treatment regardless of their ability to pay.
- Informed consent: patients should only consent to medical treatment if they have sufficient information about their diagnosis and all treatment options available in terms they can understand.
- Respect and non-discrimination: patients have the right to considerate, respectful care from all health care professionals and not be discriminated against in the delivery of services.
- Confidentiality: patients have the right to private communication and to have the confidentiality of their individually identifiable information protected.
- Complaints and appeals: patients have the right to a fair and efficient resolution of any complaint made to the medical office.
- Patient responsibilities: patients have a number of responsibilities to the medical office including active participation in their treatment plan, timely resolution of their financial obligation and respectful interaction with all staff.
The success of your medical office relies heavily on how well Patient Access services (or the front end staff) performs. The cycle of a patient account originates with the initial entry of patient demographic information. Building a dynamite patient access team is a crucial step toward improving billing and collections efforts and increasing revenue cycle performance.
The typical reasons why most patient access services teams have a low-performance rate are the lack of proper resources, inadequate training, and insufficient staffing levels. Fortunately, these can be resolved quickly and without huge expenses.
The importance of charge capture should be expressed to all departments. The clinical staff must be aware of their responsibility to accounts receivable management by accurate documentation and charge capture.
Charge capture includes the appropriate linking of medical codes to services and procedures rendered during the patient visit. Each clinical area plays an important role in the timeliness of coding and the accuracy of billing. There are a large number of areas that contribute to charge capture, including, but not limited to:
- Ambulatory Care
- Case Management
- Critical Care
- Medical-Surgical Unit
- Mental Health
- Nuclear Medicine
- Pain Management
- Physical Therapy
- Wound Care
Health Information Management
Health Information Management is the process of maintaining, storing and retrieving patient health information in accordance with applicable Federal, State, and accrediting agencies’ requirements. There are ten responsibilities within the framework of health information management.
- Medical Coding
- Medical Transcription
- Medical Necessity
- Medical Staff Support
- Assembly of Medical Records
- Maintenance of Medical Records
- Filing and Retrieval
- Privacy and Security
- Release of Information
- Maintaining Confidentiality
Patient Financial Services
Patient Financial Services is ultimately responsible for the accurate and timely billing and collection of accounts receivables in the medical office.
The medical billing process requires a complete knowledge of insurance payers and the laws and regulations of the healthcare industry. Medical office billers are responsible for the timely submission of technical or professional medical claims to insurance companies including physician offices, hospitals, nursing homes, or another healthcare facility.
Effective collections follow-up results in the speedy resolution of your medical office claims. Claims follow up should begin as quickly as seven to 10 days after your claim has been submitted for payment. Immediate efforts to get claims paid will not only reduce your accounts receivable days but also increase cash flow.
Adequate staffing with proper collections training will provide the desired outcome in the collections phase of the revenue cycle. Medical office staff should be aware of the fundamental steps necessary for efficient follow-up of insurance claims.
The collaboration and cooperation of all eight areas are integral components of the success of accounts receivable management. Although there are unexpected barriers that can impact the AR collection period, it is the role of leadership to identify and adjust for these barriers to the success of the organization.
For More Information: https://www.verywellhealth.com/accounts-receivable-management-2317545