As with everything else these days, paperless and electronic are the way to go when it comes to receiving payments and remittances from your third party payors.  As cash flow is usually a top priority with healthcare providers, the quicker the funds get to them and the quicker billers can respond to denials and turn them back around for payment the better.

Electronic Funds Transfers

Electronic Funds Transfers (EFT) are available from most third party payors. In fact, all providers enrolling in the Medicare program for the first time, and those changing information or revalidating their enrollment must participate in EFT.  Most state Medicaid programs offer EFT as well as most commercial payors, especially the larger programs such as United Healthcare and Blue Cross. EFT ensures that payment for claims is received timely and directly into a provider’s account.  This reduces the wait time for checks to come in the mail and for a live person to get that check deposited into the bank and ensures that checks are not lost or end up in the wrong hands.  Cash flow projections are much easier to manage when you have a schedule of your EFTs and you know that the funds will be there when you need them.

Electronic Remittance Advices

Along with EFT, the next thing and sometimes even more important thing you want to convert to electronic is your remittance advices.  Electronic Remittance Advices or ERAs offer many advantages to any healthcare provider.  ERAs save time and money by increasing productivity of the business office or billing staff. It allows for faster communication and payment notification. Billers are able to get and respond to payments and denials more quickly with ERAs as they are not waiting for remittance communication through the mail. ERAs increase productivity with the ability to import or electronically post payments to accounts receivable software. Providers have a more accurate and timely picture of their outstanding receivables.  By opting to receive ERAs, providers reduce operating costs and paper generation.  As with EFTs, most third party payors have the ability to offer providers ERAs.  ERAs do require special translator software to read them but these are available through claim clearinghouses and/or accounts receivable software at little to no cost to the provider. The Medicare program offers the PC Print software that is downloadable to all providers at no charge.

If a provider utilizes a clearinghouse for their claims management, receiving ERAs through that clearinghouse also offers more advantages.  For one, it increases efficiency and productivity when billing out secondary charges.  If the primary payor claim is submitted through the clearinghouse and that primary payor’s ERA is received through the clearinghouse, the clearinghouse software most often can attach the appropriate information to the claim electronically for submission of the secondary payor.  A second advantage is by receiving ERAs directly through the clearinghouse, reports can often be generated which give KPI data such as claim error rates, and top denial reasons. Thus giving providers areas for improvement which will ultimately increase cash flow and efficiency.

If offered by the third party payor, all providers should take full advantage of Electronic Funds Transfer (EFT) and the Electronic Remittance Advices (ERA). There really are no downsides to signing up for these two options. Efficiency and productivity are essential to cash flow and these two items offer multiple benefits to achieving these goals. Contact Richter Healthcare Consultants at 866.806.0799 for more tips on implementation.