Key performance indicators KPI's are an essential component to improving an ASC's financial performance. By consistently monitoring specific items, a practice can streamline its operations. To discover what factors may harm specific KPI's and potential solutions, visit this article from Surgical Notes.
Here are the most integral key performance indicators to track.
ASCs need to understand their projected revenue. Knowing what payer types are trending can help determine this estimate. A financial category boom or dip should modify income expectations. Even if your practice meets its predicted patient volume, failing to account for payer type can misalign your calculations.
To determine payer classes, compare the charges you send each agency to the reimbursements you receive. Payers that trend towards high charges but low payments may cause long-term financial problems.
Revenue per case is crucial to understanding future income. Check how much each specialty service nets. If your physicians are comfortable comparing peers, do this same process with them. A monthly revenue decrease for a physician or specialty may be worrisome. However, a spike in income should also cause concern as it may indicate upcoding.
Once you know how much each specialty nets, calculate the number of specialty visits you receive each month. A shift towards a lower revenue-generating service may significantly harm your financial predictions.
On average, ASCs should send bills less than 48 hours after a service. If your practice takes significantly longer, address this problem immediately. Billing delays can increase days sales outstanding, denials, and even result in unnecessary lost payments.
Monitor days to pay to review how long it takes insurers to settle a claim. Different agencies have unique timelines. A reliable overall standard is 45 days. Medicare may take on average18 days, and workers' compensation may take around 55 days.
Note the average number of days it takes each insurer to pay. If you find that time to pay is increasing, examine the cause. Payment delays can oftentimes be avoided and if the claim is unnecessarily delayed may cause a rise in imply denials, billing issues, or payer miscommunications.
Patient financial responsibility is increasing. As such, tracking the number of days and cases in patient AR is critical. Numerous cases may indicate that most insurers have paid, and your practice billed many patients. However, a high number of days in patient AR may imply poor collection habits.
Note how many cases have surpassed 90 days in total AR Collection typically becomes impractical after this date. A general industry standard is less than 15% of AR should reach 90 days. Exceeding this standard points to revenue cycle issues that can easily be rectified with the right RCM processes and expertise.
Write-offs can indicate denials, bad debt, timely filing, and other factors your staff failed to consider when billing and managing the total AR. Timely filing write-offs should never happen. Denial and bad debt write-offs are acceptable in low, consistent numbers. If your practice exceeds your maximum write-off goal, rethink your RCM processes and seek expert assistance to correct your RCM performance.
Calculate clean claims by measuring the percentage of claims a payer rejects. Clean claims show a successful professional coding and billing process that avoids denials. The industry goal for this metric is 98%. If your ASC receives a high rejection volume, it can imply a major claims or clearinghouse problem.
Denial reason is a critical indicator. While this reason is often a one-time fluke, it may highlight operating procedural issues. Record denials by which payer reported them. A high rejection volume from an payer can imply miscommunication of standards.
Compare a period of one year with the same period the next year. Understanding long-term changes can help expose positive growth or worrisome decline. However, this metric on its own is too vague. Many factors may have contributed to shifts over the past year. Use this metric as part of a complex system designed to narrow down problems and lead you to viable solutions.
Plutus Health understands how complex revenue cycle management is. That's why we provide services that alleviate ASCs' burdens. Our professional billing and coding team relentlessly pursues an increase in reimbursements and a shorter turnaround time to get your reimbursements into your bank account speed. Talk with a representative today to begin your financial improvement journey.
1. Monitor payment volume trending.
2. Keep a close eye on specialty services income and volume.
3. Calculate days to bill and track reimbursements by the payer.
4. Track days and cases in total AR.
5. Manage write-off percentages.
6. Observe clean claims and denial reasons.
7. Compare year-to-year changes.
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