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COVID-19

R1 RCMOctober 26, 2020

How Financial Clearance Can Create Resiliency for Physician Practices and Patients

More than half a year into COVID-19, physician practices are still facing reduced revenue and patient volume challenges that can no longer be solely attributed to patient safety concerns. Near the start of the pandemic, The New York Times cited potential infection and rising healthcare costs as the pandemic’s “twin risks” to patients. Four months later, these twin risks have evolved into a new challenge: an influx of patients with greater healthcare demands many of which are also either uninsured and underinsured.

 

The snowballing impact of patients’ “twin risks” and physician practices’ financial losses

As millions of patients cope with a loss or change in health insurance, many also have financial struggles due to reduced pay, job layoffs or business hardships. On top of these financial pressures, a large percentage are also becoming more sick. For example, one report indicates more than 80,000 cancer diagnoses might be missed or delayed due to disruptions in healthcare delivery; another shows a 38% decrease in patients treated for a life-threatening heart condition. The 40% of Americans managing one or more chronic conditions have likely missed routine care such as labwork. As a result, physician practices are treating sicker patients who need more complex treatment, which costs more for both parties. While patients are struggling to pay, physician practices  that are in financial recovery mode need to collect every dollar, more quickly than ever.

 

Revenue cycle strategies for financial resilience: financial clearance and advocacy

Various revenue cycle strategies can help physician practices increase revenue and accelerate cash flow; however, most of these strategies don’t also financially benefit the patient. Financial clearance is the exception if the program is comprehensive and proactive, with a strong financial advocacy component.

 

R1 defines financial clearance as the end-to-end workflow that starts at pre-registration – beginning at orders, outreach and patient scheduling – and extends all the way through service delivery to accomplish three key objectives:

  • Ensure the most accurate information pertaining to the visit is obtained and documented
  • Find the right financial pathway for each patient
  • Make sure the practice receives full payment for services

 

While the majority of financial clearance processes take place at the front of the revenue cycle at pre-service and point of service, our financial advocacy team continues working through the entire care continuum, until the patient receives funding and the practice is paid.

 

Three steps to help physician practices get financial clearance "basics" right

To accomplish the above objectives, practices need to be effective at numerous financial clearance “basics,” which require the right processes coupled with the right technology. These “basics” include obtaining prior authorization prior to scheduling and establishing a plan for payment prior to service. Another critical basic, which applies to multiple processes, is collecting 100% accurate patient data and insurance information.

 

The following three strategies can help you succeed at the “basics,” improving your practice’s financial health while also benefitting patients:

 

1. Establish a workflow that checks every patient for eligibility as soon as possible.

Whether your patient is scheduling an appointment online or staff is calling to remind them to book their next visit, leverage both technology and your team to conduct eligibility checks. Take every pre-service opportunity to obtain patient eligibility information and educate patients on their expected out-of-pocket payment so they’re able to plan their finances accordingly.

 

2. Develop a robust financial advocacy program. 

Programs that help patients obtain funding if they’re unable to pay their healthcare costs have numerous benefits; they can help alleviate stress and financial pressure from your patients, increase patient loyalty and satisfaction, and ensure your practice is paid in full. A robust program can even help patients who need funding for other necessities that contribute to health and wellness, such as assistance with food or housing. Be sure your financial advocacy program screens every patient at pre-service or time of service, asking questions to ensure patients who need help don’t slip through the cracks. Patient funding can be a tedious process, so leverage automation to not only help identify potential sources, but also populate financial assistance applications and monitor status updates. Read our blog post for tips on how to implement a successful financial advocacy program.

 

3. Automate prior authorization. 

The AMA’s research shows physicians spend an average of two days per week on prior authorization, and 86% indicate their burden has increased in recent years (for more information, view our infographic). Any prior authorization errors or delays can not only keep practices from receiving full and timely reimbursement but can also hinder the patient experience by delaying care.

 

Due to COVID-19 and its impact on the economy, providers are currently inundated with changes in patients’ insurance – which can create additional work, greater delays and frustration for both staff and patients. Consequently, automating prior authorization is critical for physician practices. Look for technology that moves this process to the point of order or referral; this will help your practice ensure each order captures all necessary information up front. The technology should schedule the appointment when the prior authorization is secured, thus minimizing staff intervention and maximizing resources.

 

Ensure ongoing financial resilience through a robust financial clearance program

Physician practices can reap major benefits from a financial clearance program; however, it can be difficult to fully optimize due to its many processes and large amounts of data. The right technology and workflows must be utilized, and all staff involved in financial clearance processes must be trained and fully comfortable with their proactive role counseling patients and developing a plan for payment. For example, R1 has defined 27 methods that exist in a high-performing financial clearance and advocacy program, supported by 39 standard analytical measures. These methods include schedule optimization, proactive authorization capture, and point of service collections and payment plans. Each method includes best practice processes that facilitate the 39 analytical measures, which are directly tied to physician practices’ KPIs.

 

Check out Physician Practice’s video series with R1’s Dan Dooley to learn more about achieving post-COVID financial resilience – in particular, dealing with the influx of uninsured and optimizing financial clearance:

1. Four Building Blocks for Physician Financial Clearance

2. What Financial Clearance Means for Physician Practices

3. Adjusting to Post-COVID Revenue Cycle Management for Physicians

 

Contact us to discuss how your practice can increase revenue and improve patient experience through financial clearance.