Pratt Medical Center is the oldest and largest multi-specialty group practice in the Fredericksburg, Va., area, with roots dating back to the 1937 merger of five family practice physicians. Now, however, our group faces the very modern challenge of trying to productively manage 1,000 new claims each day.
Facing ever-tightening payer restrictions and a greater number of patients carrying personal liability, we realized a few years ago that our continued success ultimately depends on the ability to do two things: 1) submit clean claims faster, and 2) easily generate reliable business intelligence. Unfortunately, at the time, both goals were hampered by underperforming technology solutions. A perfect example could be found in our denial management efforts.
We knew each billing staff member re-worked about 10-15 denied claims per day. However, our clearinghouse was unable to create basic denial reports - for instance, by provider or CPT code - that would allow front-end alleviation of recurring problems. While the practice management (PM) system we employed at the time included a denial tracking function, the process was so tedious that our staff seldom had enough time to use it. The end result: sub-par denial tracking efforts.
Claims submission suffered similarly. With no upfront notification from our clearinghouse about payer-specific reimbursement restrictions, dirty claims leaked through to payers. We were forced to devote already-stretched staff hours solely toward re-working denials - instead of toward much-desired patient service efforts such as explaining benefits or collecting balances and deductibles. In addition, the need to manually search for patient EOB information made filing secondary and tertiary claims particularly problematic.
It became clear to us that limitations with our existing PM system and clearinghouse were preventing us from accomplishing key business goals. In order to drop our average days in AR, for example, we needed to get claims out the door faster. It was also imperative to keep on top of the ever-growing number of payer edits that make it so difficult to submit clean claims. In addition, because the lean economic times pinched the bottom line, we wanted to do all of this with the same number of billers - or fewer.
Business objectives require new technology solutions
The first step toward achieving our goals involved switching to a new PM system that featured a more open architecture that did not lock us into using proprietary claims processing software. When we subsequently made the decision to look for a new clearinghouse partner, we were free to evaluate all of our options.
I commenced the evaluation process along with the practice IT director, who also serves as chief operating officer. The benefit of such a small search team is that we did not need formal evaluation tools or an involved, committee-driven process. On the other hand, it also meant we did not have the time or resources to devote to vendors who required us to carve out lengthy blocks of time for meetings and demonstrations. Instead, we chose to review vendors who were willing and able to show us their clearinghouse solutions via the Web.
We found these online demonstrations valuable in two ways. First, they revealed each vendor's inherent comfort with Web-based technology. But they also gave us insight into how well each vendor was equipped to assist us, should we need it, through Web-based education.
That was important, because one of our top priorities was to find a clearinghouse that was intuitive and easy to use. We desired simple-to-navigate, self-explanatory interfaces that would allow anyone to step in and perform the duties of any other staff member. Our goal was to find a clearinghouse solution that could help us maintain productivity across-the-board, even in the absence of key staff.
Service and support were another main focus in our search. Immediate assistance was deemed a must-have element. Unfortunately, we knew first-hand the frustrations and negative effects caused by a clearinghouse that lacked commitment to customer service; that was a road we travelled when our previous clearinghouse came under new ownership.
We thoroughly reviewed four vendors before finally selecting Navicure. All staff training was done online, according to our internal scheduling needs, and we accomplished a smooth transition to the new system on Oct. 1, 2007.
Improved AR and denial rates attained with fewer FTEs
We immediately recognized an advantage through our newfound ability to edit claims online, prior to submission. Billing staff now have access to a robust set of payer-specific edits on the front-end, and therefore can make any necessary corrections to claims before they ever reach the insurer. As a result of cleaner claims going into the clearinghouse, Pratt Medical Center now sees fewer rejections; we have dropped denials to only three or four per day.
The process additionally speeds turnaround. Our physicians often can submit claims without the need for anybody else to touch them. Claims typically are submitted on the same day - or the day after - a service is rendered, which translates into improved cash flow. Accounts receivable (AR) has dropped nine days, from an average of 40 days to 31 days.
As an added benefit, through attrition and re-assignment, we have been able to accomplish these improvements with five fewer full-time employees (FTEs). We previously devoted 1½ FTEs to nothing but claims submission duties, for example; now that task requires only a half FTE.
Indeed, the ability to use staff talent toward more productive activities often is an overlooked aspect of revenue cycle management. In our case, lack of easy access to EOB information had, in the past, created much inefficiency. We use that information for so many critical functions, such as working denials, submitting appeals, and even answering patients' billing questions. Yet our previous paper-based system required time-consuming, labor-intensive manual searching and filing. The supposedly simple act of forwarding EOB details required managers to spend hours using a marker to black out sensitive patient information - obviously not the best use of their time.
Now, managers can quickly and easily pull the desired EOB from the system and select just the information they want to send. The resulting time savings allows them to turn their attention to much more productive endeavors, including increased attention to upfront patient balances and improved secondary claims submissions. In fact, we no longer need to devote one full FTE solely to filing secondary claims.
Of great benefit, of course, is the fact that I can now routinely pull denial tracking, EOB management, and other reports to more effectively gauge efficiencies throughout our revenue cycle. I now have two avenues - through our PM system and our clearinghouse - to track denials, for instance.
Upfront payer notification is another function I have come to value. The ability to receive reports and analysis back from our payers has proven to be a wonderful asset. Perhaps one particular payer is having trouble uploading claims and estimates payment will be delayed by a week, for example. That sort of communication from the payer directly to us provides another tool to help manage our reimbursement cycle.
Lessons learned
When we first began the transition to a new clearinghouse, staff found it very helpful to receive immediate notification whenever they performed a task incorrectly. Throughout the process, we have come to realize that the value of responsive client service and communication cannot be underestimated.
We began our search for new technology solutions knowing that future success rested on our ability to generate relevant business intelligence and invigorate the revenue cycle through cleaner, faster claims submission. However, with more and more payers using Web-based applications, it also became clear that a Web-based clearinghouse was best positioned to help us accomplish these objectives.
Now, after going through our selection process, I highly recommend vendors who use Web-based training and support. We have found that our staff learns best when they can see their own data being manipulated. Through Web-based training, a vendor can show you how to accomplish a given task with your own data, so it makes sense within your own practice setting.
With all of the available training and support, our staff quickly became very comfortable with our clearinghouse solution. They also appreciate the receptive customer service team.
The simple truth is that you cannot get paid if you cannot get clean claims out the door quickly. Sitting on the telephone, waiting on hold in order to get questions answered is not an efficient use of billing staff time. Our solution was to choose a clearinghouse that would help us meet our business objectives by delivering advanced Web-based service, training and support.
By Dawn Quinn, Pratt Medical Center Business Director
