Revenue Cycle Management is all about process. If you understand the process, you can manage both the process and those employees who may have a role in it.

Charges for services provided by the facility to residents are your revenue. All charges need to be billed, either privately or to other payers such as Medicare, Medicaid or insurance carriers. In order to bill for charges, several items must be verified including; resident demographics, insurance verification (if any) and authorization, accuracy of services provided and documentation of medical necessity. Your organization most likely has an EHR (Electronic Health Record) and billing software to accommodate the documentation and billing of all charges. Revenue is important. But collection of revenue is critical.

The Revenue Cycle and Key Performance Indicators

The Revenue cycle process involves follow up….to charges submitted on claims to payers, to Medicaid applications, to collections of private pay aged accounts, etc. Administrators can keep their finger on the pulse of the Business Office performance by reviewing the following Key Performance Indicators (KPI) each month:

• The accounts receivable aging detail
• The amount of accounts greater than 90 days should be less than 15%
• What is the volume of accounts past 120 days? It should be no more than 10% of total aging
• Are there problems with particular payers?
• Can you see notes in the files or EHR regarding the follow up (denial management) and collection efforts of your staff?
• Accounts proposed for write off—should be less than 1% of net revenue
• Medicaid application pending log

Check for overuse of contractual allowance

• Is your community authorized to act as representative on behalf of the resident for purposes of the application review process?
• Is your community listed as rep payee to receive the monthly income at the community address? At the very least, change the address for the resident to the community address or better yet…set up direct deposit of the Social Security check to the Resident Trust Fund
• Is your community charging the patient liability amount each month during the application process? Estimate this using a resource assessment based on the resident’s monthly income less the Personal Needs Allowance (PNA) unless there is a spouse in the greater community.
• Are you assisting the resident and family in any way to gather evidentiary information, making copies, driving family members to any meetings, helping to complete any requests for information, serving as the representative, etc. Do not let another month pass because a family was not supported.
• If an application is denied, do you have a process in place to deal with the family?
• ADR (Additional Development Request) log
• Were there any ADRs in the previous month?
• Were they all addressed timely? Were any not addressed?
• What is the status of any appeals?
• Are there any trends that could help to prevent future ADRs?
• Is your community using a Triple Check Process for claim review prior to submission? 

Revenue Cycle Management is all about process. If you understand the process, you can manage both the process and those employees who may have a role in it. Your business office staff should understand the Revenue Cycle process and follow it in a timely manner. Doing so will help to ensure that revenue is captured and collected!

If you would like more information about the Triple Check Process, download the complimentary Richter Triple Check Checklist. Find more helpful links and downloads here.