:: A Seven Point Checklist For Revenue Cycle Enhancement

Here is a short list of tips for a healthcare provider self-audit of revenue cycle efficiency. “Claims denial management” often includes letter campaigns and claims procedure processes. For the significant claims, more is needed.

With at least one-third of the average hospital’s revenue coming from group health plans, an in-depth analysis of the manner and method of pursuing plan reimbursements merits first consideration. This is the place to “measure twice, cut once”.

This is the list:

1. Terms of Assignment. Assignments of benefits, so important to the provider’s revenue cycle, are nonetheless often given only perfunctory attention by the business office. The scope and terms of the assignment should be carefully reviewed by counsel.

2. Status of Plan. Is the health plan an ERISA plan or not? Is the plan self-funded or fully insured? Simple questions with complex answers at times. This analysis will determine the application of State laws and regulations, such as prompt pay statutes, the DOL claims procedure regulations and numerous other factors bearing on payment. See, e.g., :: How To Identify A Self-Funded ERISA Plan

3. Status of Entity. Beyond the intertwined question of the status of the plan (i.e., a governmental entity will typically sponsor an ERISA-exempt plan), the status of the employer will be particularly important if the plan is self-funded. A small employer will be very dependent on stop loss coverage for funding of claims.

4. Provider Agreements. The wild card in provider reimbursement will often be the managed care or provider agreements. These agreements may authorize a chain of authority running to entities distant from the initial parties to the agreement. Further, the agreements may contain venue selection and arbitration provisions that bear significantly on how the provider will be paid and at what rate. See, :: Arbitration of Provider Reimbursement Disputes

5. Precertification/Utilization Review. If a plan requires precertification, understand the guidelines employed by the plan. Recognize the important distinctions between confirmation of a plan member’s eligibility and confirmation of coverage for a medical procedure. Further, distinguish between approval of a procedure’s medical necessity by a utilization review company and confirmation of coverage for the procedure under the plan. See, e.g., :: Pre-Certification Fact Question Defeats Fiduciaries’ Motion To Dismiss. For more information on clinical guidelines, see the AHRQ site resource.

6. Plan Provisions. The plan provisions may contain an anti-assignment clause. The effect of such provisions is a subject in itself, but nonetheless, the presence of an anti-assignment clause should be taken into account. The claims procedures should be reviewed as well as the standard of review based upon the grant of discretion to the plan administrator.

7. Third Party Claims. Providers should have in place protocols for management of potential third party liability cases. These procedures must be reviewed with an eye toward any provider agreements that may impede such efforts. For example, if participation in a managed care network involves agreement that the patient will not be “balance billed”, then the provider may be precluded from refusing play payments in preference of liability insurance. See, :: Healthcare Providers’ Balance Billing Practices Under Scrutiny

Most providers’ business offices could benefit from staff training on these points, and virtually all providers will find at least area in which they could improve. Form letters and dunning notices have their place, but the real opportunities for revenue enhancement lie in a well-considered approach to health plan reimbursements.

For additional information on specific business office training modules, send your inquiries with areas of interest to