A Strategy for Driving Higher Net Revenue
by Jase DuRard, Chief Revenue Officer, AccuReg
Situation: Your hospital is facing a major financial issue, in either A/R, cash collections, or bad debt – maybe all three. The executive suite, and perhaps even the Board, has mandated immediate improvement. However, making a major impact on any one of these areas is a significant task, let alone all of them at the same time.
Approach: If you are facing this situation, as many in your position are, what is the first thing you do? Probably hire a consultant. But what is the next thing you can do to have the most impact?
How are you measuring success?
You will probably begin by measuring your success and looking at all parties involved:
· Are you using your vendors effectively?
· Are you finding overlap between vendors that can accomplish the same thing?
· How are you measuring your facility’s performance?
· Finally, are you using the right Key Performance Indicators (KPIs)?
My suggestion would be to re-evaluate the KPIs you are currently using. Why? Because using them landed the health system in the position it’s in today!
Where does every dollar come from?
Take a step back. If, for example, you are measuring POS Collections as a KPI, ask yourself, what comes before that? Where are the entry points in a perfect world? This gives you clear insight into the levers that need to be pulled. It also allows you to track where every dollar in your business comes from and ensure that the process is working effectively. This takes time and some skill with flow charts, but it is well worth the exercise.
Let’s look at a real-world example of a facility with extremely high A/R and Bad Debt. Where do you start? Well, A/R is money that is owed. It must be collected. You have a collections agency working for you already. But can you make an impact anywhere else? What vendors can help you to create more efficiency with your current staff?
How effective is your collections strategy?
Peel back the layers of A/R. It starts at the point where you have the first contact with the patient. Is A/R tied to POS collections? Possibly. If you have a POS Collections strategy currently in place, do you know how effective it is?
It is widely known that the correct time to ask for money from a patient is any time you have their attention!
· So, if you have a POS or even PRE-service collections strategy, first look at how to improve it.
· Second, more and more facilities are finding tremendous success by adding A/R dollars to the scheduling or estimate screens. This allows your scheduling and registration clerks to not only collect pre-service dollars, but also outstanding balances!
· The use of payment plans is also imperative. This will remove accounts from your collection agency, thus reducing the cost to collect, and it will also allow collection agencies to work the accounts that require their immediate attention.
· How do you train your scheduling/registration staff to collect A/R? Simple, by placing the dollars in front of them using your vendor. Then you script it.
Does patient satisfaction impact revenue?
So now you’re impacting POS Collections and A/R, but what else? What about Patient Experience scores?
Do you believe if framed the correct way, you could have the patient pay you happily? You should, because you can!
Studies have proven that facilities with higher patient satisfaction scores have a higher NET revenue. Why? Because the cost to collect is so much less up front, and these conversations are taking place before the Point of Crisis for the patient!
Ask yourself these questions:
· What vendors can achieve a positive patient experience?
· What vendors focus on the front-end of the revenue cycle?
· What vendors constantly evaluate your process for improvements with the PATIENT in mind?
By not asking for money at the time of treatment and – and having financial discussion sooner – you decrease patients stress levels. Your patient satisfaction scores increase. Moreover, your POS Collections increase, your A/R decreases AND you gain a repeat customer!
Remember, you are not just tracking dollars, you are tracking Patient Experience. This is the real key to driving higher net revenues.
About the Author:
Jase DuRard brings over 20 years of experience in healthcare and software solutions to AccuReg. Prior to joining the company, he worked for Zelis Payments as Senior Vice President of Enterprise Provider Solutions, Passport Health as Vice President of Enterprise Solutions, and AIM Healthcare Services where he served in various sales and operations management capacities. DuRard is also the Chief Strategy Officer and co-owner of GlassbookRx, a company designed to bridge the communication gap between providers, compounding pharmacies and patients. DuRard graduated from the University of Tennessee-Knoxville, College of Business Administration, with a B.A. in Marketing.