How to Increase Productivity and Efficiency with Medical Billing BPO

medical billing bpo

Medical billing BPO  is the practice of transferring a healthcare organization’s revenue cycle management (RCM) to a medical billing service provider. Since the billing or revenue cycle can take several days to months to complete before it’s resolved, many healthcare organizations work with a medical billing partner to shorten the billing cycle and collect payments quickly. The right medical billing BPO provider can also increase the amount of collections and improve the productivity of the practice, its physicians, and internal staff.

On that note, a reputable medical billing BPO partner is always looking for ways to increase productivity and profitability. It regularly looks at performance standards of internal and outsourced staff and compares best practices. It then makes helpful recommendations to improve billing, payment, and record-keeping processes. In addition, it provides coaching and mentoring to personnel, and is available to answer questions from employees.

Service providers can also incorporate practice-specific coding requirements and insurance policy changes to improve productivity. A good medical billing company understands the unique billing requirements of different specialties and provides solutions customized to a client’s needs.

Productivity Metrics

According to the Medical Group Management Association (MGMA), there is a strong correlation between using data-driven metrics and financial success. However, practice owners, hospital administrators, and CFOs are busy and are therefore unable to track every factor that affects business productivity. They lack the time to track every factor that affects business productivity. Instead,  by outsourcing RCM or medical billing, the service provider can collect the data necessary to create a detailed picture of practice productivity.

Some of the data that medical BPO considers for measuring productivity are: 

  • The number of physicians and medical professionals. 
  • Collections or claims per visit.
  • Total annual collections. 
  • Duties and responsibilities of each medical billing staff.

These productivity metrics are not standard. They vary according to the type of practice. In addition, standards should drive high productivity, but they must be reasonable. They can’t be impossible or too easy to achieve. Comparing these metrics with benchmarks and measuring productivity by analyzing outcomes can help the provider determine whether billing staff productivity is below or above standards.

Practice Productivity

To measure overall practice productivity, the billing company may use work relative value units (WRVU) and compare the business with other similar practices. The MGMA has rates for every specialty to facilitate comparison between benchmarks. For example, the current procedural terminology (CPT) code that indicates a level 3 office visit has a WRVU of 0.97. Yearly WRVUs may be higher for some healthcare providers than others. After calculating each provider’s WRVU, the billing company can compare the client’s data with data from similar practices

Collection effectiveness can be benchmarked using gross and net collection rate. Gross collection refers to initial charges before adjustments. Net collection is the percentage of collectible funds that are actually collected by internal or outsourced billing staff. Service providers may set a net collection percentage rate of over 95 percent to indicate financial health. The billing company can also identify areas where the practice loses money, and then implement processes to improve productivity in these areas.

Correcting Claim Denials Issues

Claim denials, which can be as high as 50 percent in some practices, can reduce profitability dramatically. Unpaid bills that run over 120 days can also affect the levels of productivity. The billing provider can correct these issues quickly through various means. This includes scrubbing claims before submission, assigning an experienced team to difficult claims, and increasing low-value collections.

The billing provider also uses benchmarks to compare work functions for each employee against standards. Different benchmarks are used for a biller that only posts charges and payments and a biller that performs claims processing as well as follow-up work and appeals/resubmission. The provider ensures that each billing professional works toward metrics that actually help achieve the goal of collecting every dollar owed to the practice. For a midsize practice with eight specialists, a sample benchmark is $1.3 million in collections per biller per year.

Coding Productivity

Every time a patient receives medical care, the service is documented in paper or the electronic medical record (EMR). Medical billers and coders review the EMR or patient chart, assign the right code for each service, and ensure that claim forms are accurate and complete before submitting to the insurance company. The medical biller or coder consults ICD-9/10, CPT and HCPCs references to determine which code should be assigned to a certain procedure, office visit or hospital stay.

Billing providers often measure coding productivity using speed and accuracy metrics for each medical coder. The American Health Information Management Association (AHIMA) recommends separate productivity standards for four (4) different types of coding: inpatient, ER, ancillary testing, outpatient/interventional surgery and procedure.

The time needed to code accurately and completely depends on the service mix or service offerings. If most of the cases are ICU patients or complex surgical/trauma, accurate coding time can overshoot national productivity averages. If, on the other hand, most of the cases are less complicated, like pediatrics and obstetrics, charts-per-hour can be significantly higher than the average. For instance, a medical biller or coder should be able to complete 3 patient records per hour or 24 records per 8-hour day for inpatient coding. ER coding is considered less complex, so the coder should be able to complete 120 records per 8-hour day.

ICD-11 implementation

The International Classification of Diseases (ICD-11) was approved by the World Health Assembly in 2019, and came into effect worldwide on January 1, 2022. The ICD ensures the operability of digital health data and it contains diseases, disorders and health conditions. Billing companies have systems in place for coding ICD-11 effectively. In fact, healthcare organizations transitioned efficiently and effortlessly from ICD-10 to ICD-11 by outsourcing.

Service providers understand that it is important to strike a balance between coding speed and accuracy. Speed cannot be the sole driving force behind productivity; billing accuracy is even more important and needs to be monitored. If errors are found, the service provider can correct them immediately.

How to Increase Productivity and Efficiency with Medical Billing BPO

Physician Productivity

Part of the success of an outsourced revenue cycle management project depends on how well a practice’s internal and outsourced billing staff can perform their duties. At the same time, RCM success revolves around the services that physicians and healthcare professionals provide their patients. Physicians are busy, and as such, need all the support they can get.

Medical billing providers can boost the productivity of physicians by increasing the time they spend on patient care and reducing the time spent on administrative and billing tasks. For practices with their own billing departments, medical billing companies can improve physician productivity through consulting services. The billing provider may recommend offloading non-critical tasks (such as handling lab results, patient charts and faxes) to the outsourced team. They could also or provide cross-training to in-house support personnel so they can fill in for healthcare providers whenever necessary.

EMR and Productivity Software

Some practices are reluctant to switch from paper to electronic medical records (EMR). They believe the transition would take more work, which would consequently decrease productivity and reduce the number of patients that physicians would be able to see. Although the use of EMR requires immediate entry of necessary patient data into medical billing software for insurance purposes, it can be done before the appointment. Physicians can also save time by entering pertinent information only, without filling out the entire form. They can also accomplish most of the work during the visit.

Paper chart filing and searching takes up over 20 percent of administrative time at medical practices. Switching to EMR eliminates this. It also gives practices greater control over patient data and allows for more accurate record-keeping. This means no more indecipherable physician handwriting. Compared to paper claims, electronic claims can save a business from 7 to 14 processing days.

The right medical billing or RCM software provided by third parties has been proven to increase productivity. It gives practice owners and administrators valuable insights into performance and allows the client and billing company to stay connected. While the medical office has access to patient records that can help staff collect outstanding balances during appointments, the biller has real-time access to demographics, insurance, and other data needed for claims submission.

That said, the right software billers have access to crucial information that allows them to follow-up, appeal and resubmit quickly and efficiently. Also, practice admin and CFOs can easily generate comprehensive reports so they can check performance levels and productivity statistics for all levels of support staff.

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