It’s difficult to stomach the headlines of insurance providers posting record profits when hospitals’ costs have increased by 65%. Moreover, revenue has dropped by the same percentage—forcing financial executives to make difficult decisions in an effort to save money.
For many revenue cycle administrators, it may be time to start checking under the proverbial couch cushions for additional dollars. Reviewing your zero-balance accounts for underpayments might seem like a waste of time, but—much like the lost gems you find in your couch—there is an ever-present source of income hidden there. The American Medical Association reports that commercial health plans experienced claim-processing error rates as high as 20% in recent years. Additionally, nationwide commercial payers have continually underpaid claims by up to 10%.
If you find yourself questioning the accuracy of reimbursement for your organization’s services, you may need to dig deeper to understand why. Engaging in a zero-balance review of your organization’s claims is a good starting point to provide both peace of mind and “found money.” You can also use the data you find to address operational issues upstream and negotiate favorable payer contracts. Here are three reasons a zero-balance review can be a step in the right direction for your organization:
It Identifies Recoverable Cash Hidden in Zero-Balance Accounts
In most cases, organizations accept any payment(s) as the proper reimbursement. This happens for a variety of reasons. For instance, staff members often dedicate their time to pursuing reimbursement from accounts that carry an active balance, or complex contracts are misinterpreted or inaccurately loaded, therefore rendering inappropriate payments. Other issues exist in the categorization of denials or application of contractual adjustments. Having a second set of eyes on these accounts can be invaluable. Revenue secured through a third-party review process is applied directly to the bottom line—because the claims have already been written off.
It Helps You Improve Your Processes
You don’t have time to fix everything by going over your day-to-day activities with a fine-toothed comb. Using the reporting and feedback from a zero-balance review allows you to prioritize and take corrective action on underlying issues that lead to inappropriate write-offs. Lessons learned through a zero-balance review can help you make small changes that significantly affect your bottom line. The data you glean can accurately identify root causes of recently overlooked problems, enabling you to train staff better or adjust system contract parameters. This two-pronged approach can save your organization significant time and money, while also yielding additional reimbursement earlier in the cycle.
It Brings Ammo to the War Room
You can leverage the data collected in a zero-balance review to identify opportunities in your next round of contract negotiations. Due to the complexity of negotiating and administering multiple contracts, your payer contract management process must take a comprehensive approach. It is imperative to have accurate data that justifies your negotiations. In a typical game of give and take, you may increase the negative impact of a current contract by negotiating terms that are not substantial. The overall goal should be to establish contracts that provide expected reimbursement. The data you get from a third-party zero-balance review will assist in constructing an effective contract model to measure payer performance, thus allowing you to hold them accountable.
Following a multi-tiered strategy can have a significant short-term cash impact and long-term reduction in revenue loss. When seeking a third party to assist in your zero-balance review, look for a vendor who offers an adequate blend of technology and a traditional, hands-on approach. Technology can be used to load and analyze contracts to identify potential variances—but it is equally important for a team of reliable staff with billing, coding, and denial experience to invest time in investigating and validating legitimate discrepancies. Once the issues are confirmed, their underlying cause is uncovered, enabling the team to formulate a plan to secure appropriate resolution with the payer. When negotiating with a third party, identify partners that offer limited or no upfront cost with a favorable contingency arrangement.
Don’t couch-dive alone—let us hold the flashlight. At ARx, our leading technology and seasoned staff members can come alongside your team to identify the reimbursement you’re missing, and we’ll make sure you get it back. Reach out to us today to get started.