Beating Break-Even: The Power of Partnerships

    Posted by Katrina Slavey and Stephanie Boim on May 19, 2016 1:00:08 PM
    Physician practice managers work together to improve revenue cycle and operational performance

    One of our clients, a large hospital-owned physician practice network, needed to quickly improve their financial performance. Their Rapid Improvement Plan included goals designed to speed up the cash collection process, maximize opportunities for reimbursement, improve coding and documentation at the clinics, and increase provider productivity. Sound familiar?

    With these goals in mind, we convened in a conference room with about a dozen key players, including practice managers as well as representatives from information systems, finance, revenue cycle, and managed care. The two of us from Halley—a revenue cycle expert and an operations expert—began engaging the group in a conversation regarding the overall performance of the physician practice network. In our passion and enthusiasm for the topic, we seamlessly worked together throughout the discussion, even to the point of finishing each other’s sentences. This was just a normal day for us, supporting one another in our roles, and we didn’t give any thought to the impact of what we were modeling. But for the leaders sitting around the conference table, our synergy was a revelation: This is how it should work. This is the partnership of operations and revenue cycle in action.

    The Financial Hazards of “Us versus Them”

    One of the biggest mistakes a hospital-owned medical network can make is to overlook the fact that 85% of revenue cycle performance is owned at the practice level. In other words, practice providers and staff are responsible for 85% of the tasks that determine whether the organization will get paid for services rendered. And yet most hospitals and practices have a fragmented, “us versus them” mentality when it comes to revenue cycle and operations, failing to recognize that collecting revenue in an accurate and timely manner requires a highly synergistic approach.

    The hard truth is this: Organizations that fail to establish a culture of collaboration and accountability across the continuum of care have much more at stake than a few lost dollars here or there. A fragmented process often results in decreased patient satisfaction, operational inefficiencies, and significant losses that are beyond repair, even with the most robust Rapid Improvement Plan. 

    Changing the Process

    To beat break-even, the operations and revenue cycle teams—and all supporting departments—must partner together and take responsibility for their respective roles in the process.

    Below are a few ways that team members can support one another in developing workflows and processes that reduce losses and benefit the individual practice and the network as a whole.

    • Gather accurate information at the practice site.

    Practice personnel must be sure to obtain correct and current patient information such as address, date of birth, co-pay collection, and an image of the patient’s insurance card. Failure to do so may result in claim re-work, denials, and multiple patient statements, leading to unnecessary spending for the network and frustration for the patient.

    • Complete the payer credentialing process before onboarding new providers.

    The credentialing process takes a minimum of 90 days and can often take 180 or more days, depending on the payer. Organizations that are focused on increasing market share and building their provider base without completed provider credentialing may be setting themselves up for thousands of dollars in write-offs.

    Network leaders should be sure to allow sufficient time for processing before onboarding their new providers—or they must understand and forecast the lost revenue resulting from a strategic decision.

    • Provide consistent education for all team members.

    In this fast-paced era of changing healthcare and global communication, education is critical. Insurance companies regularly make policy changes that affect reporting trends or that require adaptation in the way patient or claim information is entered. It’s critical for all team members to establish an open relationship where communication of these changes is natural and consistent. Open dialogue allows for knowledge sharing and problem solving of critical industry changes and challenges affecting the network.

    The revenue cycle team has the advantage of numbers and can quickly identify denial trends across the network. Physician practices have the advantage of face-to-face contact with patients. Working together, they can offer continued education that focuses on patient satisfaction, insurance payer rules, practice management system utilization, company policies, coding and documentation, and universal best practices (such as providing consistent education to patients through messaging or other means).1 This synergistic partnership drives operational efficiencies and ensures providers are working smarter, not harder.

    • Develop a culture of accountability.

    Accountability for all teams begins with communicating openly, understanding the strategy, and measuring the results. Key leaders can monitor progress and manage expectations during weekly meetings. As a group, operations and revenue cycle team members can follow a site-specific plan with actionable items that impact the overall health of the practice. Such a tool allows the group to track and trend progress toward key initiatives relative to practice performance, including revenue cycle.

    The beauty of a detailed, site-specific plan is that it allows for a deep dive into all pertinent practice information and gives key stakeholders the opportunity to have open conversations about adjusting the plan and/or expectations as necessary, fostering relationships, and delivering results.

    Change, as they say, doesn’t happen overnight. And it certainly doesn’t happen without hard work, organizational engagement, and the willingness to rethink and revise routine practices. But by enhancing communication, building partnerships, changing workflows, and establishing a culture of accountability, our client saw just under $5 million in improvements over a nine-month period (equivalent to one month gross patient revenue). More importantly, they’ve been able to sustain the changes and continue to see improvements a year later. This is because they have come to understand that improving performance begins with building relationships.

    1. Harmon, R. (2014). MGMA Performance and Practices of Successful Medical Groups: 2014 Report Based on 2013 Data. Englewood, CO: Medical Group Management Association. 

    Topics: Physician Practice Management, Revenue Cycle

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    Halley Consulting Group has a proven track record of building high performing medical practices. We can show you how to continue to benefit from the downstream revenue provided by your owned physician network, while at the same time, diminishing the losses. If this type of measurable performance improvement would be of interest to you, please contact us! We would be delighted to visit with you. 

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