Indisputable Hurdles to Getting Every Dollar Owed … Unless You Have Prior Authorization Software
The pressures healthcare providers face haven’t eased up this year. Northern Arizona Healthcare CFO Clifford F. Loader told HealthLeaders in July that “The after-effects of the pandemic—such as a general shortage of healthcare providers such as doctors and nurses, and continuing inflation in the pricing of medical supplies and pharmaceuticals—are ongoing. With no further funds anticipated, the healthcare industry is facing adverse financial impacts.”
Is it any wonder that many healthcare providers are looking for ways to stabilize their revenue cycles. Prior authorization software can help, especially when it comes to getting reimbursed (by payers and patients).
Lack of patient financial transparency
Almost 90% of consumers received a surprise medical bill last year, according to research reported by Rev Cycle Intelligence. Some said a bill was more than expected; others said a bill wasn’t expected at all.
That in itself is a problem because, as the HFMA points out, “The healthcare revenue cycle is critical to the patient experience of care. It’s the first touchpoint patients have with a health system and the last encounter patients will remember.” If what your patients remember is an unexpected medical bill, don’t hold your breath for a 5-star review.
In fact, the research on surprise billing also found:
- 70% receive medical bills via the mail but a majority of consumers would prefer online billing
- 74% of Millennials would even switch providers for a better payment experience
- Yet, 39% of providers downplay the impact billing and collections have on the patient experience.
Of course, improving price transparency isn’t only about keeping bills out of collections. It’s about keeping people healthy. Diana Nole, CEO of Wolters Kluwer Health, writes in FierceHealthcare that “The lack of transparency between cost and outcomes means some patients will just opt out … Millennials in particular are showing they will forego needed procedures or treatments—61% will refuse treatment due to cost considerations, compared with 31% of baby boomers.”
Given the high stakes to both patients and your revenue cycle, patient financial responsibility calculations are a must.
Tip for improving price transparency
Embed patient financial responsibility calculation at the front end of the revenue cycle: patient intake. Prior authorization software can provide end-to-end automation, from benefits verification to calculation of patient financial responsibility based on the patient’s exact benefits, co-pay, and deductibles. You provide the price transparency that patients want and need. At the same time, you have a timely touchpoint to inform patients of payment options. Both make it less likely that bills will end up in collections.
Claim denials have been creeping upward for years. According to research by KaufmanHall, 67% of providers reported an increased rate of claim denials in 2022, more than double the number from 2021. One cause: the number of services, procedures and medications requiring prior authorization has increased significantly too. The good news is that 86% of denials are potentially avoidable and 34% are absolutely avoidable, according to the American Journal of Managed Care.
Tips for reducing claim denials
KaufmanHall suggests building a cross-functional team to gain a 360-degree view of denial trends. Or, you could try establishing a prior auth triage role to troubleshoot denials and pinpoint root causes for future prevention. But the most effective approach takes aim at preventable denials on two fronts: eligibility verification and prior authorization.
- Verifying insurance coverage and other benefit information accounts for almost half of all transaction volume.
- Identifying prior authorization requirements and submitting clean prior auth requests remains a considerable burden in terms of time and staffing, often resulting in treatment delays, denials and expensive rework or write-offs.
Prior authorization software allows you to automate the process,connecting the dots between patients’ health and benefits information, providers’ clinical documentation, and payers’ plans and policies. This reduces reliance on institutional knowledge or detective work to identify requirements. Software typically pre-checks submissions for errors or missing information too, reducing preventable denials and up to 90% of denials rework.
Better collections begin with a more streamlined, accurate process at the first point of patient contact. Learn more about how Myndshft prior authorization software helps healthcare providers address patient intake and prior authorization issues that contribute to missed revenue.