Key Performance Indicators To Judge The Effectiveness Of A Medical Billing Company
The
intricacies of medical billing appear to have no end in today’s complex and
difficult reimbursement situations. Regardless of the challenges, you must be
ready to guarantee that collections are optimized and streamlined. As a result,
keeping track of your practice’s financial performance while providing
excellent patient care is critical to the success of your medical billing
practice.
How do
you know if your business and the people you choose to execute your medical
billing practice is running at full speed? Creating a dashboard of key
performance indicators might help you stay focused on your goals. Medical
billing metrics, also known as Key Performance Indicator (KPI’s), assist
practitioners in gaining a better understanding of their revenue cycle and
providing insight into how to boost collections.
This is why so many practices will concentrate on medical
billing key performance indicators.
1. Identify bad debts
One of
the most important medical billing KPIs to keep an eye on is the bad debt rate.
Not all of your patients will be able to pay their bills on time, and you
should have anticipated this when reviewing all of your revenue. However, one
of the most important medical billing KPIs is to monitor the bad debt rate
which is stated as a percentage. Divide authorized charges by bad debt
write-offs to get this percentage.
2. Make use of your KPI data
It’s
important to stay within industry norms on key metrics, but it’s easy to get
distracted by the plethora of external obstacles that affect your performance.
As a result, be aware of the upper bounds. While underperformance on some or
all of these indicators may be unavoidable in your situation, it is beneficial
to draw a line that will prompt you to search deeper for possibilities to
enhance performance.
3. Track Gross Collection Rate
Another
important KPI is the gross collection rate which is calculated by dividing
money from payments by invoiced charges. It’s a good metric to utilize when
comparing the cash flow of your company and also to obtain a better picture of
what future collections will be like by examining the fluctuations. The gross
collection rate will always be affected in case there are any alterations made
to the patient population, fees, and insurance providers.
4. Check Accounts Receivable (A/R) Days
The accounts receivable (A/R) of
practice reflects how many payments have yet to be received, whether for
insurance reimbursements or out-of-pocket expenses. The goal here is to study
and improve to streamline your operations in order to get your practice
reimbursed faster. This may entail reducing billing and coding errors or
improving claim follow-up. Keeping track of how long claims spend in A/R can
help clinics figure out which payers are delayed and why.
5. Calculate Net Collection Rate
You’ll
need to calculate the net collection rate to see how much money your practice
is making out of all the bills that are available for payment. It’s calculated
by dividing payments by the total number of allowable charges. You can compare
different groups in your company using the net collection rate, and see how
demographic changes affect the percentages your teams collect.
6. Identify Resolve/ Denial Rate
The
effectiveness of your practice’s resolution rate will reveal how disciplined
your personnel is in managing revenue flow. This is calculated by dividing the
total number of claims paid in a particular time by the total number of claims
filed in the same period. On the other hand, the denial rate is calculated by
dividing the number of claims refused by the number of claims remitted.
7. Curate the Unbilled Claims
Calculate
the number of claims divided by the number of claims that were rejected due to
incorrect or missing information to get a handle on this critical performance
metric. Details like inaccurate doctor’s orders, omitting or using wrong DX
codes and errors in patient demographic information can all contribute to a
higher unbilled claims KPI.
When it
comes to medical billing services,
practices will need to pay particular attention to the finer points to ensure
employee efficiency and effectiveness. Therefore, keeping track of medical
billing KPIs will help such medical billing practices be top of important
metrics and improve the revenue cycle.
Unsure
of how to manage such KPIs or how to go about it? You can simply reach out
to 24/7 Medical Billing Services
and we will take it from there. We put a lot of consideration into the best
ways to discover and analyze your KPIs over time as a medical billing provider
with our diverse industry expertise; helping you maximize your practice’s
income potential. We will also help you examine such KPIs for daily activities
as well as weekly performance, monthly trends, and quarterly updates to help
you ensure you maintain a well-orchestrated medical billing practice.
About
24/7 Medical Billing Services:
We are
a medical billing company that offers ‘24/7
Medical Billing Services’ and support physicians, hospitals, medical
institutions and group practices with our end to end medical billing solutions.
We help you earn more revenue with our quick and affordable services. Our
customized Revenue Cycle Management (RCM) solutions allow physicians to attract
additional revenue and reduce administrative burden or losses.
Contact:
24/7
Medical Billing Services
Tel: +1
888-502-0537
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