The ambulatory surgical center (ASC) market has expanded rapidly in recent years. Due to insurance limitations and increasing health costs, more people are turning to the outpatient setting for quality surgery at affordable costs. Outsourcing medical billing helps ASCs with many of their financial concerns and increase profitability. However, recent reports indicate that ASCs continue to face many challenges when it comes to improving revenue performance.
- Increase in number of Accounts Receivable (AR) days: A/R refers to the average number of days that an ASC takes to collect payments for services provided. Days in A/R are one of the main measures that ASCs use to measure performance. Based on VMG Health data, Becker’s ASC Review reported that the average days in A/R for ASCs is 32. Procedure scheduling, patient pre-registration, insurance verification, patient financial counseling, patient payment plans and patient collections are among the many factors that impact AR days. According to a recent Beckers ASC Review report, setting up a patient financing solution that pays within just a few days of a procedure can also reduce days in A/R. This will protect the center if patients default on their payment.
- Cancellations: Cancellations have always been a major concern for ASCs. Facing high out-of-pocket costs for elective surgery, many patients whose surgery is cancelled, may not reschedule as they reconsider their decision to incur the expense. Same-day cancellations of scheduled surgery have a tangible, negative financial impact – they would be unable to fill the open OR with another surgery but must still incur their overhead and labor costs.
ASCs need to work on identifying the causes for the cancellations and take appropriate steps to deal with the problem. Ongoing communicating with patients and tracking change in the patient’s medical status can cut cancellations. Another recommended strategy is implementing patient financing options. A Becker’s Hospital Review report recommends providing a secured loan to patients to cover their surgical costs. This can reduce cancellations, grow surgical volume, decease AR and increase cash flow.
- Surprise billing: It has become common for patients to receive additional bills from out-of-network providers, even after they have settled their copays and deductibles. In fact, surprise billing is a national problem and many states have passed laws to curb the practice. Mnet cautions that providers operating in these states should understand these laws to avoid lawsuits. ASCs should also be wary of surprise billing or risk losing patients. According to a Beckers ASC Review report, providers can take the following steps to protect patients from surprise billing:
- See that anesthesiologists, pathologists and lab professionals are in-network.
- Inform the patient if these specialists cannot be brought in-network, in which case, the patient’s bill will include these additional charges.
- Managing and keeping up with payer contracts: ASCs face many challenges when it comes to managing payer contracts, which are subject to frequent changes. Payers also have different rules and conditions with regard to care plans, local coverage determinations (LCDs), preventive care, bundled payments, etc. A recent report from the American Association of Orthopedic Executives (AAOE) offers the following tips:
- Break through narrow/closed networks by letting the payer know why it is good for the payer to have the surgical center in their network – highlight unique service benefits, geographic advantages, clinical/treatment benefits, and out of network patient counts and referrals.
- Consider a blend of direct commercial payer agreements and both primary and secondary complementary payer agreements.
- Focus on any concerns about contracts’ language.
- Review contracts periodically to keep track of changes and contract expiry dates.
- Understand individual payer rules.
- Keeping track of coding changes: Keeping track of CPT codes and ICD-10 codes changes are another major concern for ASCs. In January 2018, for instance, the American Medical Association (AMA) added 170 new codes, revised 60 codes, and deleted 82 codes. ASCs need to be aware of such yearly changes and implement them. ICD-10 codes are also updated each October. ASCs should update their software system with these new codes. Partnering with an experienced medical coding company can go a long way in keeping track of code updates and implementing them to ensure error-free claim submission and accurate ASC medical billing for optimal reimbursement.
Outsourcing medical billing to an experienced service provider can ensure comprehensive support for all of these tasks, and help ASCs get paid faster and reduce days in AR. Such companies have trained coders and billing specialists who can ensure clean claim submission. Their team will review accounts, identify those with problems, and fast-track them for resolution. They will work to reduce days in A/R by reviewing denials and filing appeals. Experienced companies also provide business intelligence reports and performance-driven analytics. With higher patient deductibles and healthcare changes, seeking expert external support for ASC medical billing and coding will help improve collections and grow the overall bottom line.