How not to lose money when you migrate to a new revenue cycle system

EXECUTIVE SUMMARY

The consumer landscape has changed dramatically over the last two decades, and the healthcare space has seen several such changes including impact of ICD transition, proliferation of cloud-based revenue cycle providers, changes in the products of health plans, and not to mention, the need to do more with less on account of reducing reimbursement rates. 

System transitions are one of the most significant causes of lost revenue in Provider revenue cycle management. As salespeople reach out to you to make a quick decision to switch your core revenue cycle management platform, you as a decision maker need to carefully evaluate if your decision could potentially have an adverse impact on your financials. Whether you are a physician practice or a revenue cycle services provider, you need to take time to consider the implications of the system transition and, more importantly, put in place a comprehensive right set of change management processes to achieve a successful revenue cycle system transition. 

Migrating revenue cycle platforms requires a careful consideration of both IT and business needs, and challenges. While the new platform providers typically enable a smooth systems implementation from a technology perspective, more often than not, they give you options around a cutoff date prior to which the revenue cycle data is not migrated. 

Furthermore, most of your internal staff is focused on transitioning to the new system. With a lack of clear guidelines on write-offs, persistent follow-up on aged A/R and lack of focus on ensuring that revenue cycle processes are consistently run on both systems, issues such as reduced reimbursement, physician dissatisfaction, client exits, and lost revenue often creep up. 

Effective collaboration between your revenue cycle systems provider and business process outsourcing (BPO) partners early in the transition can help address issues such as loss of data from the old to the new platform, ineffective follow up of old A/R balances, ineffective linkage of EMR records with patient data, and loss of patient data or the reimbursement history. Therefore, the importance of a strong governance model through the transition cannot be undermined. 

In this paper, we examine the key challenges of transitioning to new revenue cycle platforms and provide best practices from our in-depth experience across multiple platforms and supporting over 25 clients.

INTRODUCTION

For Healthcare providers, it is important to improve reimbursement rates while continuing to be compliant with the regulatory requirements. While new revenue cycle platforms offer an opportunity to reduce work effort in the practice as well as the back-office, system transitions often result in lost revenue and excessive costs of transitions. 

Migrating an existing revenue cycle processes to new platform poses a unique set of challenges. For effective RCM platform transitions, effective integration of IT and business process transition would help in the elimination of revenue leakage and effective transition of elements such as:

1. Patient Information and Charges

• Ensure that the Patient data is migrated to the new platform. This will improve effectiveness of the new system being implemented 
• Ensure new charges are entered into the new system from the date of switchover

2. Accounts Receivable

• Transition Aged Accounts Receivable information data transition based on the agreed cutoff date 
• If you are migrating partial A/R data, ensure medical history and associated records are migrated for the accounts with balances 
• Ensure availability of the old RCM and EMR system to run out A/R effectively

3. Medical Information

• Medical history and EMR information should be carefully transitioned with strong governance and oversight

ACCOUNTS RECEIVABLE RUN DOWN STRATEGIES

Revenue cycle managers should work with the chief financial officers to decide on the time period for which a collections effort needs to be initiated, the method to value the aged A/R balances, guidelines for write-offs, and choice of the right partners. Some of the most critical elements in running down aged A/R balances are the following:

A. PREPARING FOR TRANSITION

i)   Ensure Credit balances are cleared as much as possible prior to the migration 
ii)  Ensure that the files related to the remaining credit balance are available for future processing

i)   Valuing Aged A/R is as much an art as it is a science 

ii)  Information on historical success rates with collecting A/R by aging bucket, timely filed claims, and by payer can help in valuing the aged A/R correctly 

iii)  Get expert help for valuing A/R 

i) It is important that you work your A/R backlog off the old system. Irrespective of the switchover date, there is a good possibility that information required to support your claims may not be transitioned perfectly. This will enable stronger recovery  

i)  Since EMR Systems are often transitioned along with the RCM systems, an ineffective transition may lead to medical records not being available once the system is migrated. Therefore, transition managers need to ensure that the medical records associated with RCM/EMR system migrations are available to the teams handing A/R run down project 

ii)  Legacy AR data should be available for any backtracking and audits 

iii) Payment reconciliation and availability are key to ensure a smooth transition.

B) PURSUE A/R STRATEGICALLY

Go after the low hanging fruits
Define priorities based on thorough analysis of outstanding AR

i)   Low hanging fruits: Dissection of A/R by payers and by date of service will give you a clear view of the accounts that are most likely to get paid. Create a SWAT team to chase this set of accounts and track progress aggressively

ii)  Very old A/R: The time period for which a collection/run down effort needs to be initiated needs to be planned carefully. Very Old A/R balances have very limited chance of success

iii)  Low Balance: Clearly understand the cost to collect and take a decision on writing off old A/R where the cost of collections is more that amount likely to get recovered. Decide to adjust the old AR where the cost of collections is more than the actual collections

Define the policies for operations team
i)   Define the policies for tracking effectiveness of the A/R run down effort 
ii)  Address every claim at least once to maximize collections 

iii) Set goals and track aggressively 

iv) Track progress of old AR – Collections & Reduction of outstanding AR 

v)  Define write off policies. Clearly, understand the cost to collect and take a decision on writing off old A/R where the cost of collections is more that amount likely to get recovered 

vi)  Ensure there is governance through the run-down effort

Get a specialized team

There are different ways in which Revenue Cycle Managers can look at addressing old A/R at the time of system migration

i)  Existing Staff: Utilizing existing staff is an obvious choice but it is often not the most effective one. Platform migration being a complex project typically drains out resources and drives focus on business as usual vs. the old A/R. 

ii)  Utilizing a BPO vendor: Choice of BPO vendors should be dependent on their ability to resolve A/R rather than just obtain statuses of the balances. Resolution of each account may require a lot more interaction with internal stakeholders during platform migration than is normal. Contracting could be for a contingency fee or for touching up each account. Contingency fee models could be developed based on total A/R collected by the vendor. 

iii) Factoring Services: Several Healthcare RCM services providers offer factoring services.Choice of factoring services provider should be done only after the A/R has been diligently valued. As mentioned earlier in this paper, valuing A/R is an art and hence, choose your service provider carefully

  

About the Authors:

• Sanjeev Britto, Vice President of Operations, With over 13 years of experience in the delivery of revenue cycle processes, Sanjeev leads the delivery of best practices to over 40 Access Healthcare Customers. He can be reached at sanjeev.britto@accesshealthcare.co 
• Manish Jain, Chief Marketing Officer. Manish brings over 15 years of experience in solution design, sales, and marketing supporting healthcare and financial services customers. He can be reached at manish.jain@acceshealthcare.co

About Access Healthcare

Access Healthcare provides business process outsourcing, applications services, and robotic process automation tools to healthcare providers, payers, and related service providers. We operate from 12 delivery centers across US, India and the Philippines. Our 8,000+ staff is committed to bringing revenue cycle excellence to our customers by leveraging technology, emerging best practices, and global delivery. Based in Dallas, we support over 150,000 physicians, serve 80+ specialties, process over $ 50 billion of A/R annually, and ascribe medical codes to over 10 million charts annually. To learn how Access Healthcare can help your organization boost its financial performance, visit accesshealthcare.org.