Using KPIs to Accelerate Revenue Cycle Performance
Measurement • We’ve all heard it: you can’t manage what you don’t measure. – Measurement aids in identifying problem areas. – Sets the stage for setting goals/targets and working toward them. • It is also a proven principle that: – When performance is measured, performance improves. When performance is measured and reported, the rate of improvement will accelerate beyond mere measurement alone. • Other principles to keep in mind: – Ensure that what you are measuring is accurate and meaningful. Use a standard data source. – Use metrics instead of just data reporting – the more standardized and widely used, the better. Examples: HARA, HFMA’s Revenue Cycle MAP Keys, PNC benchmarking initiative! – Measure early and measure often. – Automate the measurement process as much as possible.
Developing KPIs • What to measure? – Develop indicators for each process at the department/ functional level as well as overall RCM indicators • Develop a baseline – where are you today? • Where have you been? – Trending information is more valuable than one point in time – Calculate values for the previous 12 – 18 months – Track a 3 – 6 month rolling average • Where do you want to be? – Use resources such as HFMA & HARA for best practice benchmarks – Try to find benchmarks more specific to your type of facility and geographic region – Look for opportunities and create your “own” target
KPIs by Functional Area PATIENT REVENUE CLAIMS OTHER ACCESS INTEGRITY MANAGEMENT REIMBURSEMENT MANAGEMENT • Pre-Registration • Days Gross Revenue • Final-Billed-Not- • Initial Zero Paid • Cash Collections as Rate in Discharged-Not- Submitted (FBNS) Denial Rate % of Net Revenue Final-Billed (DNFB) • Point-of-Service • Final-Billed-Not- • Clean Claim • Initial Partial Paid • Days Cash on Hand Collections Rate Submitted to Payer Submission Rate Denial Rate (FBNS) • Uninsured Patient • Discharged-Not- Conversion Rate Submitted to Payer (DNSP) • Net Days in A/R • Insurance • Late Charges as % of • A/R Aging • Overturned Denial • Bad Debt Write-offs Verification Rate Total Charges Distribution Rate as % of Gross • Insurance • Billed A/R >90 Days • Charity Care Write- Authorization Rate ∙ 3rd Party >90 Days offs as % of Gross ∙ Self Pay >90Days • Charity Care to • Days Gross Revenue • Cost-to-Collect Uncompensated Care Held in Credit Balances