By Lindsay Gross, Executive Vice President of Operations at National Medical Billing Services
While COVID-19 initially caused a shutdown or significant slowdown for surgery centers, ASCs have worked their way back to achieving pre-pandemic volumes. Surgery centers have proven to deliver safe and high quality outcomes, and have become a very attractive destination for patients given that it allows them to have surgery without being required to enter a hospital setting. Given this dynamic, ASCs are well situated to continue growing and thriving in 2021 and beyond.
According to a Bain & Co. report, the number of ASC procedures is projected to hit 27 million in 2021—an increase of 35 percent from 2015. Revenue is estimated to increase 54 percent for the same time period.
No matter how great the demand, ASCs have to remain vigilant about maintaining high quality outcomes while simultaneously maximizing revenue and improving efficiency. Payers reimburse outpatient surgery centers at roughly 50 percent of the hospital rate for similar procedures; yet, surgery centers continue to improve their services and offer more complex procedures. So, in order to make sure that you don’t leave any money on the table, it is critical that you shore up your financial systems and processes.
To maximize revenue, it is important to refine these 3 areas of your business:
1. Negotiate managed care contracts right. By “right” we mean as much in your favor as possible. To do that, first make sure you have complete copies of existing contracts and fee schedules. Next, review those contracts with an expert in managed care contracts.
A strong contract is one that’s profitable for your ASC. Are you being paid appropriately for implants? Negotiate for higher implant coverage and contract rates. Know every expense that goes into a case and make sure you’re paid appropriately.
Before you meet with payers to discuss contracts, research your market as well as your business. Compile reports on patient satisfaction, quality measures, case costs, case mix, and volume, among other data. You’ll want to present information that shows payers the value you provide as an ASC and/or why they should move procedures to your facility.
2. Master the revenue cycle. The revenue cycle encompasses everything from coding to accounts receivable. An effective revenue cycle starts with efficient front-end processes. Establish processes to ensure accurate intake, and always provide an estimate. Not only does this build trust with your patients, it helps start the financial conversation. According to our data, 85 percent of providers say it’s “very difficult” to collect post-surgery. Collect payment before surgery.
Next to seamless pre-authorization, accurate coding is the foundation for effective revenue cycle. Experienced coders can decipher doctor’s notes, pull out correct CPT and ICD-10 codes, ensure that the data complies with payer guidelines, and ask questions when needed. This process will lead to highly compliant coding while also maximizing revenue.
Payment posting is one of the final steps in the revenue cycle and should not be overlooked. Your payment posting department needs to make sure all lines on the remittance advice match the individual lines that were billed on the claim form. Oftentimes payers will lump the entire payment into one line and short change you on the reimbursement without you knowing it. It is also critical to appeal any denials or underpayments promptly.
3. Sophisticated Analytics. To get a complete financial picture that can allow you to make informed business decisions, sophisticated business intelligence or analytics tools are a must. These tools allow you to make smart, data-driven financial decisions moving forward, as well as compile the quality data needed for value-based reimbursement models.
Excel spreadsheets can provide some useful information, but don’t allow for deep insights. Many revenue cycle solutions include analytics for detailed examination into profit and loss by specialty, procedure, physician, and payer. Financial metrics help you examine physician performance and service costs. Does it make financial sense to bring in additional specialties or purchase new equipment that will be needed for those new specialties? Analytics help you decide.
Data analytics platforms can process large amounts of data to help you forecast demand for devices, supplies, and medications for a more efficient supply chain. You can also analyze procedure times to better manage physician blocks and staff schedules. Considering healthcare providers spend the majority of their budgets on labor, analytics around staffing can lead to significant annual savings.
The ASC revenue cycle is complicated and constantly changing. By following the 3 steps outlined in this article, your ASC will have strong contracts with payers, allowing you to stabilize your financials, have compliant coding that maximizes revenue with correctly posted payments and accurate patient statements and lastly, have access to data to make informed decisions that impact the performance of your center.
This post was published November 9, 2020.