July 2022 | Vol. 2
As leaders in Healthcare Revenue Cycle Management (RCM), MedCycle’s goal is to empower organizations by providing innovative best practice solutions. MedCycle identifies the root causes of the issues within your RCM processes. From provider credentialing and enrollment to insurance aging cleanup, medical billing, EMR builds and optimizations, RevCycle assessments, staff training, and education – our proven processes result in improved efficiency, greater cash flow, and maximized reimbursements. MedConnex strives to provide information around industry metrics.
Insurance Aging – Reporting
Frequent reporting is the key indicator in understanding what’s going on with your practice’s Insurance Aging. Without good reporting, it is difficult to know where your practice is succeeding, as well as where they could be doing better. Keeping an eye on your Insurance Aging is one of the reports we recommend keeping a close eye on. It is important to run this report at least monthly, and for larger practices, refreshing it weekly or even daily can be necessary. When analyzing this report, some things you want to keep an eye on, are what percentage of claims/dollars are sitting in your current aging bucket, all the way up to your 121+ day bucket. While there are a couple of carve-out exceptions, for the vast majority of practices, your current aging bucket should hold the majority of percentage of your claim count/dollars, and your 121+ bucket should hold the least.
Insurance Aging – Examples
Let’s look at two examples:
The first example – is what a healthy Insurance AR can look like. The 0-30 buckets hold the highest percentage of dollars and are well above MGMA national standards. Each subsequent bucket has the appropriate level of drops in how many dollars and the corresponding percentage in each bucket. At a very high level, the overall RCM practices within this group seem to be working well.
In the second example – shows us rather quickly, that there are broken processes within the overall RCM department. This high-level report itself can’t tell us ‘why’, but it does give us the big picture that RCM processes are either not set up correctly, or if they are set up, they’re not being followed. We would have to drill deeper into reporting to figure out what is going on – in order to implement corrective actions, which often include staff training, fixing EMR, billing and clearinghouse system setup criteria, and implementing new processes and workflows.
Insurance Aging – Tips
Using the second example (orange) to dig a bit deeper, let’s say that the breakdown looks like this:
This example tells us a few things:
- Medicare and Medicaid aging processes are okay – each aging bucket goes down in dollar amounts.
- Commercial aging is not going well. There’s a steady decline from 0-120, but once it hits 121+, the numbers jump significantly.
- Auto claims are either not being worked or not working correctly, or maybe sitting in litigation holding up payment.
At a high level, these numbers tell us that the easy stuff is being worked, but the harder or more complicated items are being pushed to the wayside. As you can see, there is quite a bit of money just sitting on the table here. In this example, 20.45% of the practice’s money is in the 121+ bucket overall – with 8% of it being tied up in the 121+ bucket for Auto claims. Overall, Auto claims account for 13% of the practices claims volume.
It is important to remember, that every practice’s Insurance Aging is going to look different. And that there are going to be practices that are outliers to the industry standard benchmarks. – there are many variables that go into these numbers, including (but not limited to) the practices specialty, volume, and payor mix.
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