Timely resolution of your credit balances can generate a significant net income pickup for your organization because, typically, only 15% of your credit balances result in refunds to patients/payers.
Resolving your credit balances is necessary in maintaining compliance, but it can also be a revenue opportunity. The Healthcare Financial Management Association (HFMA) estimates that a small-to-medium-size hospital generates approximately $2M in credit balances annually.
When a busy, metropolitan hospital system found
itself falling behind schedule in working its
accounts receivable credit balances, it was faced
with the choice of either failing to comply with
government regulations or diverting more staff to
the task – costing the CBO time and money that
would be better spent elsewhere.
The CFO of the hospital chose a third option: engage Hospital Revenue Cycle Solutions (HRCS) for this special project, to analyze and process the Receivables Department’s entire load of credit balances spanning 10 years. And what he thought would be an unpleasant necessity turned into a very pleasant surprise—an unexpected $600,000 payoff!
Digging Up Buried Treasure
On a one-month project basis, HRCS worked through 15,000 accounts using its established, well-proven methodology to distinguish true credit balances from the false ones caused by data entry error, a very common occurrence nationwide.
Errors had led to credit balances totaling $600,000 that the hospital didn’t really owe anyone. It’s not that this hospital’s CBO personnel were unusually bad at their jobs; rather, it’s a fact of human nature that out of the total of actions taken, a percentage of them will be mistakes. So, it’s a universal problem, but one that can easily be fixed if the correct actions are taken.
Saving Staff Hours
The CFO’s original goal of keeping his own staff focused on more clearly profitable activities, such as working unpaid claims, was achieved while HRCS managed and executed the entire credit balance resolution and compliance project from start to finish.
With our deep knowledge and expertise of Medicare and other corporate and governmental regulations on timely resolution of credit balances in receivables, we put the hospital on a secure footing for ongoing compliance in just three weeks’ time.
Converting a Lose/Lose to Win/Win
From the project’s inception, the CFO had understood HRCS’s fee for this service to be the lesser of two evils over the looming non-compliance penalties. However, the reward that ensued – the $600,000 found by HRCS—was an unexpected bonus for seeing that work that had to be done anyway got done and a substantial net gain, even after HRCS’s fee was paid.
Why Choose Hospital Revenue Cycle Solutions?
HRCS partners with organizations to improve their Healthcare Revenue Cycle Management processes, to deliver a faster, more profitable payment system. We are committed to providing highly customized, value-focused revenue cycle outsourcing services that result in efficiency gains, increased corporate and governmental compliance, and overall optimized financial performance for our healthcare clients.
With more than 20 years of experience, HRCS is a leader in healthcare billing and services, and full CBO outsourcing. We also specialize in high-value, high-touch project work that we execute with unmatched quality, driven by our philosophy of a “client-first” approach to excellence.
We've recently tackled $5 million in Credit Balances for one of our clients and completed the project in less than six weeks! The CFO is happy and they are ready for the auditors. How many Credits are at your hospital?
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