How to Improve your Funding/Claims Performance

• By David Kopf
• Jul 01, 2011

The funding climate in which providers currently find themselves can be described as anything but friendly. Round One of competitive bidding is more than a half a year into implementation. The bidding of Round Two is coming up fast. Standard power mobility providers have had to transition their businesses to a rental model now that the first-month purchase option has been removed. Oxygen providers continue to content with their rental cap. And, last but not least, CMS has unleashed an audit blitzkrieg on both past and incoming claims. The last thing HME providers need is an inefficient billing system.

If anything, providers need to become the masters of efficient billing and claims processing so that they can drive down the amount of time their claims remain outstanding. Gone are the days when providers can handle processes by paper and fax, or with home spun solutions. They need the top tools of the trade to help them ensure they can keep cash flowing into their businesses.

Fortunately they have help in the form of dedicated HME software systems. HME software systems originally began as billing systems, and over the years they have expanded to help automate and streamline other aspects of HME provider operations, so that they are now tools that manage entire HME businesses. And because of that expansion, the billing capabilities of HME software have likewise evolved to the point that they are now most certainly indispensable.

One of the challenges that necessitates using dedicated HME software billing systems is the sheer complexity of Medicare, Medicaid and private payor billing. The amount of minutiae, as well as the follow up required can be staggering unless a provider can automate processes. Especially if the provider has a small staff charged with trying to control the process. Let’s examine some of the ways these systems can tackle these tough challenges:

Automation. Providers that still try to handle billing manually, typically experience terrifyingly long Days Sales Outstanding (DSOs). They can be as long as 100 days or even longer. Software systems can slash that by half or more. Some providers can enjoy DSOs of as few 25 days. The key here is automating every aspect of the billing process to drive as much time out of it as possible The ways software can do this varies, but a key requirement is to ensure that the software pairs up well to the HME provider’s business processes. Work with software vendors and explain to them in meticulous detail the processes you go through to process a claim from start to finish. See at what points they can shave time off the process and by how much.

Electronic filing. The ability to track and manage the claims process and move each claim to submission on a much quicker turnaround is a key benefit way to drive down a provider’s DSOs. And the next step is to speed up the claims submissions process. Here, too, software can help by electronically connecting with funding sources in order to submit claims, rather than handling the process via paper and snail mail. Whether Medicare, Medicaid or private payor, handling claims submissions electronically — and ideally over the Internet — greatly reduces the time a claim remains outstanding.

And of course this also frees up staff time. Instead of standing by a modem or a fax machine, tearing their hair out over dropped calls, billing staff can let the software do the work. Ultimately, the filing portion of claims processing should be almost invisible. In most systems, the provider enters in billing information for all its funding sources, as well as the information on its patients. When that provider has a claim to a specific payor, the software takes care of formatting that electronic claim for the payor.

Claims verification. But before claims are even submitted, another key to ensuring fast funding turnaround is verifying that the claims is correct and won’t be rejected for any reason. Of course, this is incredibly important given the current auditing microscope CMS has placed over HMEs. Software can put claims through not only the correct processes, but essentially “vet” them electronically to make sure they have all the proper documentation and other required information. Likewise it can also prompt staff to manually go through them, and note that they have done so, as well. Cutting claims denial rates is equally important as cutting DSOs. And if a claim is denied, software can help clean up the claim so that it can be resubmitted.

Collections. Another way to boost that cash flow is through collections. They might be small, but they add up in a big way. Increasingly providers are looking to patient copays to ensure the financial health of their businesses, and here too, HME software can help. Using software, smaller providers that need any and all possible revenue can use software to collect copays. Software can help them track outstanding copays, send out billing notices and automate their collections efforts. And if a provider doesn’t have the staff bandwidth to pursue those copays, there are third-party A/R firms that offer solutions that can integrate with many HME software systems.

Reporting. Of course, what gets measured gets managed, and software systems help provider management monitor what is a dizzying amount of reimbursement data. Many systems can summarize this data into easy to read executive “dashboard” views that can give them a quick picture of the company’s billing performance.

This article originally appeared in the July 2011 issue of HME Business.