Presentation on theme: "Data Mining Your Credit Balances – How to Find the GOLD"— Presentation transcript:
1 Data Mining Your Credit Balances – How to Find the GOLD Maryland Chapter of AAHAMMonthly MeetingThe Hotel at Arundel PreserveDecember 19, 2014
2 Magnitude Of The Credit Balance Problem Hospitals with annual revenues of $100 million can generate $3 million of new credit balances each year.Nation-wide, more than $10 billion in new credit balances are created by each year.A large teaching facility or health system may require 10 FTEs just to resolve the new credit balances that are created each year.Cost to cut a refund check? $10, $15…up to $35 !!!!!
3 Causes of Credit Balances Front-end efficiencies/Increase up-front collectionsComplex reimbursements/Multiple insurance coverageBack-end resolution of overpayments has not kept pace with front-end improvementsStaffing required to manually resolve credit balances far exceeds available resourcesTypical focus is on resolving high dollar overpaymentsAllowance errors are not prioritizedThousands of small balance Patient overpayments continue to build, prohibiting efficient processingTitle should be credit balances…
4 Why are so Many Staff Hours Required to Resolve Credit Balance Accounts? Resolving credit balances is a manual process that requires the retrieval of documentation and the completion of various forms:EOB Request FormsCheck / Refund Request FormsGovernment Forms (CMS Form 838)Refund Submission Forms to Various PayersPiles/Stacks of Greenbar printoutsApril 14, 2017
5 Where’s the Gold?Did we see if we could make the Allowance gold or yellow?
6 Finding YOUR Gold Determine YOUR ratio’s Run reports based on payment service codesbased on allowance service codes(NOT based on FC, Ins Bucket or Ins Plan Code)Review your credit balance policies/procedures to ensure findings supportedHandling of small balance write-offs for both credit and debit balancesApproval levels appropriate for today’s environment?Adjustment limits; Refund limitsDollar threshold for bothSigning/approval authority for bothAdd insurance bucket to Not based. Spell out Credit balance Review small balance policy for dollar limits and to include both debit and credit balance Add both adjustment and refund approval limits.
7 Mining Tool-Belt People Systems Your Staff 3rd Party Staff Payer ResourcesSystemsPASAd-HocContract Management3rd Party SystemUnder people add payer resources. Change vendor to 3rd party staff
8 Using the Tools - Patient DRILL into report to identify like – causesMatching Debit – same DOSMatching Debit – different DOSOpen Debit – different DOSPrepayment with no DOSDuplicate paymentVALIDATE for accuracy (95% or higher)Run report(s) on routine basisAUTOMATE where possibleAdd matching debit different DOS. Same comment as allowance under automate
9 Risks Associated With Not Resolving Patient Refunds Patient Dissatisfaction – Bad PRIncreased State Legislation Regarding Patient RefundsCalifornia, Texas, North Carolina, New York…Adverse Effect on Up-front CollectionsChange titleApril 14, 2017
10 Root Causes to Look For - Patient FACILITYRESOLUTIONCOUNTTOTAL $Happy Holidays Health SystemMatching debit account and account has only one payment. Payment was for two accounts but was only posted to one account.165$ (4,694.11)Matching debit account.301$ (62,390.29)Patient overpayment on this DOS but patient has other open debit balances.150$ (32,329.76)Patient overpayment.1,331$ (457,458.87)Patient prepayment.34$ (10,486.03)1,981$ (567,359.06)April 14, 2017
11 Using the Tools - Allowances DRILL into report to identify like–causesDuplicate adjustmentTwice in errorAdjustment equals balanceNo paymentsCharges added/removed after billingMis-posting DOSVALIDATE for accuracy (95% or higher)Run report(s) on routine basisAUTOMATE where possible
12 Root Causes to Look For - Allowances FACILITYRESOLUTIONCOUNTTOTAL $Happy Holidays Health SystemAccount has no payments. Possible allowance posting error or charges were over adjusted.165$ (122,863.52)Adjustment equals account balance.620$ (282,477.61)Adjustment was posted two times in error.775$ (209,747.24)Charges were adjusted off incorrectly.327$ (39,120.83)Total adjustments meet or exceed total charges.912$ (279,412.88)2,799$ (933,622.08)April 14, 2017
13 Using the Tools – Payer Review contracts Appeal Correspondence Timely filing/look-backsLate chargesCharges removedCheck or take-back?Segregate process accordinglyAppeal CorrespondenceNo response = Payer retraction. Keep your money!Make use of a “Free Labor” resourceFree labor to provider = Reduced costsAdd after late charges/charges removed. Remove automate … cant on payer stuffApril 14, 2017
14 Risks Associated With Not Resolving Credit Balances Criminal/Civil PenaltiesMis-stated ProfitMis-stated RevenueNegative Management Letter CommentsPatient DissatisfactionAdd after late charges/charges removed. Remove automate … cant on payer stuffApril 14, 2017
15 Benefits to Using Automation to Resolve Credit Balance Accounts Allows the Provider to process outstanding backlog of credit balances without having to add additional staffGreatly reduces the costs associated with processing credit balance accountsMinimizes the possibility of manual errors and potential fraudulent activityEnsures ongoing, timely processing of credit balancesSimplifies and speeds up daily proceduresApril 14, 2017
16 Types of Credit Balance Accounts that can be Automated Mis-posted Contractual AdjustmentsMis-posted Payments/Payment TransfersPatient RefundsShould is be changed to was?
17 How Does Automation Work? Automation is a process used to resolve large volumes of patient refunds or mis-posted allowances without any human interaction.Scoring algorithms are used to identify accounts that have patient overpayments or mis-posted allowancesTransaction files are created that are then batch uploaded into the providers patient accounting system to resolve the credit balance accountsShould is be changed to was?
18 CCF Case StudyIn 2007, CCF identified a large number of outstanding credit balances that were overpaid by patients29,000 accounts affected24,000 patient refunds due$890,000CCF set a goal to resolve all outstanding patient refunds within a one year periodEstimated total cost to manually resolve all current patient refunds was $170,000 to $200,000Prior to implementing automation, CCF staff performed a statistical sample of potential patient refunds to ensure that the accuracy rate was 99% or higherShould is be changed to was?
19 ResultsCCF processed 24,000 patient refund checks over a three month period at a total cost of $27,000. A savings of $173,000 based on the initial estimate.CCF continues to process patient refunds on a weekly basis through an automated process. On average 800 patient refunds are processed through automation on an ongoing weekly basis.April 14, 2017
20 Impact to CCF Gross Days in Credit Balance – 2004 Hospital = 2.6 Physicians = 7.3Gross Days in Credit Balance – 2009Hospital = 1.2 (54% reduction)Physicians = 4.1 (44% reduction)Total FTE Savings Since 2005 = 50 FTE’sIncreased patient satisfactionApril 14, 2017
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