As the nation’s skilled nursing organizations continue to face enormous regulatory, staffing, and financial challenges, it’s more important than ever for them to take steps to optimize their revenue cycle. And RCM services are designed to do just that, helping to ensure that skilled nursing facilities not only receive appropriate reimbursement for care delivered, but also operate more effectively with the confidence that their cash flow is secure.
Yet some facilities are still hesitant to partner with an RCM vendor, even as they hire third-party vendors for other specialized work. Other facilities simply haven’t prioritized it in the face of other day-to-day clinical challenges. But for SNFs, the ability to operate depends on efficient reimbursement for the care provided, so time is of the essence.
For SNFs still considering an outsourced RCM strategy, here are three ways to tell whether you can benefit from partnering with an RCM expert.
3 reasons for skilled nursing providers to embrace RCM services
“The days of billing a claim and trusting it’ll be paid are over,” as Quality Healthcare Resources (QHCR) President Aaron Hellman explained in a recent news release announcing the company’s partnership with MatrixCare.
“The financial and regulatory landscape of skilled nursing has grown too complex,” Hellman continued. “Our communities need strategic, always-on revenue cycle management support powered by the right people, processes, and technologies to continue providing best-in-class care.”
As experts in supplying those RCM people, processes, and technologies, QHCR is MatrixCare’s source for insights into why so many SNFs need expert revenue cycle management today. How can these organizations tell it’s time to find an RCM partner? How will an RCM partner benefit their community? Here are three key signs to look out for.
#1: Your net collection rate is less than 98%
If your net collection rate is 98% or less — and most facilities range in the low 70s to high 80s — then you’re being under-reimbursed for your services. Other indicators of RCM issues include high days sales outstanding, mounting aging over 90, and a high number of write-offs.
Whatever your specific symptoms may be, the meaning is the same: Your organization isn’t being fully or efficiently reimbursed for care delivered. And that doesn’t just jeopardize your financial health, but also your ability to continue providing world-class care.
It’s not unusual for organizations to be unaware of their net collection rate, or to need help understanding your aging breakdown. As part of our partnership with QHCR, MatrixCare offers a complimentary accounts receivable (A/R) assessment to identify opportunities to improve collections and cash flow. QHCR’s A/R analysis includes calculating and contextualizing your net collections rate, days sales outstanding, and A/R over 90. You can learn more here.
#2: You have low net collections or cash flow, but you don’t know why
Facilities that don’t understand why their net collections are low are particularly well positioned to benefit from RCM services. After all, there’s a wide gulf between knowing that your collections are low and understanding why, or how to fix the problem. RCM is complex, and it can be difficult to stay on top of current regulations, best practices, and payer requirements, especially for SNFs with limited billing resources or personnel.
At the same time, organizations that don’t know how to pinpoint the errors in their billing, denial management and collections processes are poorly positioned to improve them. But this is no easy task, and struggling to develop a robust RCM strategy isn’t unusual. RCM is complex, and there are many reasons why you might miss reimbursement opportunities.
For example, maybe your Medicare reimbursement rate is 99%, but Medicaid is at 78%. Do you have a lot of Medicaid pending cases? Is there a lack of urgency on application follow-up? How is your payer tree set up? Documentation gaps, unclear processes, and numerous other issues could all contribute to low or sluggish reimbursement.
Knowing you have a problem is an advantage. But having strategies, people, and resources in place to correct your financial challenges is another matter altogether. A professional, dedicated RCM partner has the expertise to identify financial warning signs, diagnose the problem, and execute the optimal solution. They focus on your RCM performance so your back-office team can focus on other internal operations priorities.
If you’re not sure if your current methods are working, we offer a complimentary A/R assessment. Contact your MatrixCare account manager to learn more.
#3: You’re struggling with back-office turnover
Many organizations lack the back-office personnel, resources or expertise to handle the mounting complexity of SNF billing. On top of that, back-office employees are resigning at higher rates than ever. And that can drain an organization’s knowledge base, forcing them to invest extra time and money in expensive contract workers and recruitment.
One MatrixCare client recently shared that their sole biller had quit, only to offer to come back as a contract worker for double the pay when the community couldn’t find a replacement. Meanwhile, that community was losing money as accounts aged and it struggled to stay up to date on current billings.
An RCM partner can eliminate all of these staffing and retention difficulties at once. They can provide a stable, dedicated workforce staffed with experts who are specifically hired, trained, and focused on your organization’s RCM strategy.
And this stability extends beyond the Great Resignation. With an RCM services provider, organizations won’t have to worry about any lapse in revenue cycle management due to vacations, sickness, or retirement. RCM vendors provide a deep roster of RCM billing knowledge overall, as well as knowledge on a specific facility’s precise financial operations.
It’s easy for small facilities to get swamped in day-to-day operations and miss opportunities for improvement. But every month that you’re in that position, and putting off optimizing your revenue cycle, is a month where your organization is losing money. RCM services provide the expertise you need to maximize revenue without the need to employ a full staff of experts.
Learn more about RCM services with a complimentary assessment
For businesses looking to elevate their financial performance to support quality care, the easiest way to begin is with a free A/R assessment from QHCR, an official MatrixCare partner. Their experts will assess your data to determine net collection rate, day sales outstanding and A/R over 90, and then compare that performance against industry benchmarks.