Disruption caused by the COVID-19 pandemic is operationally and financially challenging for health care providers—creating rapid changes in projected volume and cash flow. And while these challenges introduce significant upheaval, they also create an environment for health care organizations to create effective cash-acceleration programs.
Typically, if an operational crisis—such as an unsuccessful system conversion or major process failure—occurs during a revenue cycle cash-acceleration project, it’s addressed quickly to prevent problematic backlogs in accounts receivable (AR) claims. Additional assistance can come from a business partner, who provides the health care organization with much-needed cash to help remedy the AR backlog.
However, the COVID-19 pandemic requires a more advanced approach. While the traditional cash-acceleration process is still necessary, it’s also important to create longer-term solutions in the revenue cycle to prepare for potentially lingering problems.
The following eight steps can help your health care organization strategically increase its cash collections while implementing long-term improvements.
1. Create a Two-Pronged Approach
To achieve short-term cash collections as well as a more robust, longer-term revenue cycle strategy, a health care organization can benefit from developing a two-pronged process approach:
- Utilize its collections team to review and address unpaid claims and secure short-term cash flow
- Get additional weigh-in from its improvement team to address the root causes of a disruption and suggest steps for long-term process enhancements
2. Prioritize Accounts Requiring Resolution
After developing a process approach, the next step is to prioritize accounts for collections.
While one team within collections analyzes the claims for resolution, a subgroup should look for trends and process weaknesses occurring within the collection of the accounts.
3. Consider a Temporary Staffing Reallocation
Your company’s resources—such as staff, equipment, and system access—need to be marshalled to quickly identify and address AR for collection. That could mean redistributing your staff to make sure the project is completed accurately and in a timely manner.
Leadership should also consider how to improve the team’s project schedule and objectives, making sure they coordinate with the collection team’s efforts.
4. Revise Your Approach to Collections
The identified AR for collection could be materially different than the typical billing and collection process, so leadership should carefully consider how the collection team approaches collections.
Revisiting the collections process also provides an opportunity for the improvement team to determine what went wrong with payments from various commercial and governmental health plans and provide insight into improving those processes and teams going forward.
5. Create or Modify Work Lists
When determining your collections approach, your collections team may need to create or modify its work lists so that they’re organized by individual payer or specific account criteria.
Developing individualized or specialized work lists will help your organization identify longer-term solutions to problem areas.
6. Develop Management Reporting
Nothing gets solved in the long term unless results are measured.
Implementing weekly reporting on the cash acceleration process can help your organization measure its improvement activities and help its collections and improvement teams get accustomed to regular and actionable metrics reporting.
7. Implement Follow-Up Processes
It’s important to coordinate internal hospital staff as well as any external vendors in the collection team’s follow-up and account resolution.
This could require developing and distributing new follow-up processes or communication protocols.
8. Identify Root Causes of Disruption
In a simple framework, business improvement projects focus on three core pillars: process, team, and technology. Some of the following areas can be the root cause of disruption when performing cash-acceleration projects.
Common process-related disruptions include:
- Non-value added manual tasks
- Weak or nonexistent performance metrics and monitoring
- Lack of consistent standardized procedures across the organization
Some team-related disruptions include:
- Inconsistent and variable training
- Unaddressed error rates
- Low employee retention rate
Common technology-related disruptions include:
- Systems not configured for optimization
- Claim edits not reviewed and updated
- Underutilized automation tools
Cash-acceleration projects are born out of an internal crisis in the revenue cycle. The COVID-19 pandemic presents an external crisis that is requiring organizations to strategically increase cash collections as well as allowing them to make long-term improvements typically not seen in short-term cash acceleration efforts.
However, upfront planning and strategically applying your team’s effort is key to making this process successful in both the short- and long-term.
We’re Here to Help
To learn more about how to get started with your health care organization’s cash-acceleration program, contact your Moss Adams professional.