The Top 5 Revenue Cycle Management Key Performance Indicators You Need To Track For Success
A solid revenue cycle management (RCM) strategy must track certain key performance indicators (KPIs) in order to understand patterns and optimize processes and flows.
If you manage your revenue cycle yourself or hire in-house office staff for the task, you know how tiresome and tedious it is to create a strategy that runs smoothly and efficiently. Not to mention, that having a weak process in place nearly guarantees touch point mistakes, leading to high rates of avoidable denials and rejections.
Consider the following KPIs as the vitals you need to track to ensure your revenue stream is healthy:
Days in Accounts Receivable
Tracking the days in A/R will reveal how long it takes you to get paid for your services on average. This information is critical in determining the efficiency in this particular point in your RCM workflow, as you’ll discover how long it takes your office to obtain payment for services.
How To Find this KPI: Divide the total A/R by the average daily net patient service revenue. (To get the average daily net patient service revenue, divide total annual sales by 365.)
Denial Rate
If you have a high rate of denials, you’ll need to put certain tactics in place to prevent future rejections, especially since our research shows that up to 90% of denials are avoidable. Document the reasons for denials and then put an action plan in place.
Example: Dr. Fields tracked the top 5 KPIs for his practice and discovered that he had a high rate of denials. After checking past claims and documenting the reason for denials, he realized that there were a high number of errors in coding. After spending a high cost for training material and professional development sessions to train his staff and implementing quality assessment checks on all postings, Dr. Fields’ denial rate was reduced.
Clean Claims Rate
Having a high clean claims rate fuels your practice’s cash flow, so it’s imperative to send out clean claims the first time around. This KPI will tell you whether or not the first touchpoints dealing with patient registration and insurance eligibility in your RCM flow is working accurately and efficiently. Even small mistakes in demographics or insurance information can result in a denial, so be sure to train your staff to quality check information before submitting a claim.
Pending Claims Rate
Check your current rate against last year’s rate. Has it increased, decreased, or remained the same? Your ideal rate is either low or steadily decreasing until you hit your goal. This KPI can give you information on your documentation, authorization, confirmation, billing, and respiratory teams.
Reimbursement Rate
Is your reimbursement rate improving month after month? If so, it means you’re ensuring that patients aren’t paying less than the contracted rates and your staff is properly trained to enter orders accurately the first time. If not, you’ll need to analyze these two touchpoints in your RCM workflow and optimize them.
Remember, it’s not enough to simply track these data points. After gathering the information, it’s important that you examine the data and find ways to strengthen weak points in your process and optimize it as much as possible.
The fastest, easiest, and most cost-efficient way to track these KPIs and optimize your process is by partnering with an outsourcing RCM solutions firm like Plutus Health.
Not only do our RCM experts create optimized workflows for practices and specialty labs, but we do it using Zeus, our robotic processing automation software offered as a service. Enjoy more time to focus on patients and more money when you save on overhead costs by allowing us to create an end-to-end RCM strategy that will track these 5 vital KPIs to increase the health of your revenue stream.
Connect with a Plutus Health representative today to learn how our rcm services can help your practice or lab eliminate human error, decrease overhead costs, and increase your revenue.
