3 Leading Indicators of Constrained Financial Margins in Healthcare
Whether we are officially in a recession or not, our economy is contracting and inflation is impacting businesses and their margins. turmoil. Factors such as record high gas prices, a volatile housing market, bearish investors among others are causing instability. From a healthcare perspective—shortage of qualified staff, reduction in demand for certain healthcare services and shrinking financial margins are signs that must be monitored. Healthcare sometimes follows the larger economic trends a bit later in timing so now is a good time to prepare your business.
Three signs that your healthcare business is facing more difficult times ahead are:
These signs are further aggravated by increased encounters, an increase in avoidable denials and decreased reimbursement.
The challenge for healthcare providers is to circumvent constrained financial margins while maintaining and improving services (and the experience) to the patient. So, as the old saying goes , “how can you squeeze blood out of a turnip?”
The easiest of these turnips to squeeze would be unresolved claims. The Kaiser Family Foundation recently released a report that stated nearly one in five healthcare claims submitted are eventually denied (https://revcycleintelligence.com/news/claim-denial-rates-as-high-as-80-for-some-marketplace-payers). In the 2020 Denials Index, Change Healthcare corroborated these numbers but also concluded that half of the denials are caused by front-end revenue cycle issues related to registration/eligibility errors and authorization difficulties (https://www.ache.org/-/media/ache/about-ache/corporate-partners/the_change_healthcare_2020-revenue_cycle_denials_index.pdf). The index’s final conclusion was that 86% of denials are avoidable!
To counter these avoidable denials, healthcare entities are beginning to use overlapping solutions in their front-end (patient-facing) and back-end (billing & revenue cycle) workflows. Intelligent Verification utilizes real-time, real-world with access to 300 million individuals in multiple data sources, over 3.5 billion records and thousands of managed care providers.
No matter what system, technology or service you are currently using for the first step in claims processing (scrubbing), intelligent verification is the solution for rejection prevention will reclaim more revenue than you are now. Intelligent verification provides the highest level of accuracy in verifying the information needed to process claims, maximizing reimbursements with no money left behind.
By Darryl Berryhill
VP Business Development, tevixMD