The New Year: Opportunities and Challenges
Happy New Year! These three words have a dual meaning for a hospital’s revenue cycle: opportunities and challenges. Organizations need to embrace the new year by taking advantage of the opportunities presented while also preparing for the challenges that lie ahead. Cash collections and additional referrals serve as some opportunities and new payer and governmental requirements serve as some challenges.
A constant for the new year is a new benefit period. Patients with insurance will have new deductibles and out of pocket maximums to meet. This is the best time to be creating estimates and asking for money upfront. The Pre-Registration team should be calling scheduled patients to collect any patient financial responsibility prior to them coming in for their services and the Registration team, at the hospital, should be collecting from patients in the Emergency Department, those directly admitted, and those that present for walk in services. The opportunity to increase cash collections in the new year is huge…if you don’t ask for it, you will not get it.
Preventive services provide an opportunity for hospitals to capture additional revenue each year. These are services that patients need to have and most insurances cover at 100%. Therefore, a health system should be proactively reaching out to existing patients as well as potential patients in the community to encourage them to seek preventive services such as an annual physical, screening mammogram, lab work, etc. Participating in health fairs or other community outreach programs allow organizations to take advantage of the audience being in front of them and can provide education about the services they offer, schedule patients on the spot for services they need, as well as help the community members find a primary care physician and/or insurance they may qualify for. This outreach initiative is a win-win…the community benefits in receiving the services they need to stay healthy and the hospital experiences additional revenue through increased volumes and new referrals.
New payer requirements can make this time of year quite challenging. It appears January 1st is the date that payers use to introduce new prior authorization lists, new prescription drug coverage, and benefit plan changes. These new changes require hospital revenue cycle departments to be on their toes. Staff must verify all insurances no matter what, even if a patient was just here in December of 2018. For any patients that were scheduled in 2018 but are having the services in 2019, all those insurances need to be reverified. Front end systems need to be updated with new payer authorizations requirements and any systems that use the payer contracts need to be updated as well if those contracts change terms in the new year.
Just like the payer requirements, the governmental requirements also make this time of year challenging. Every January 1st, the Center for Medicare and Medicaid Services, CMS, publishes the new medical necessity codes, new inpatient only codes, and the new Medicare fee schedule, thus requiring the revenue cycle staff to reeducate themselves on the updated information. All systems using this information from CMS need to be updated to ensure the organization maintains compliance with CMS, prevents avoidable denials, and maximizes reimbursement for the services provided.
Opportunities and Challenges = Money
In healthcare, there is money in the opportunities and challenges that the new year brings. Cash collections and additional referrals directly increase revenue for the organization by asking the patients for payments and collecting from insurance companies, while new payer and governmental requirements indirectly increase revenue for the organization by maintaining compliance of the new requirements. No one said it was going to be easy. Happy New Year!
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