To keep the revenue cycle process inhouse or outsource to a vendor—that is the question. At one time or another, most medical practices—especially those that experience growth—come to a crossroads about the best way to manage billing and finances.
The decision can get complicated. Suppose, for example, a medical practice has outsourced revenue cycle management (RCM), but is no longer satisfied with the services provided. Now the practice must choose from three options: (1) keep the current RCM vendor and work with them to improve the situation, (2) bring RCM in-house, or (3) switch to a new vendor.
An unacceptable status quo
When I arrived at Loden Vision Centers in Nashville to serve as CEO, I immediately faced this three-way fork in the road. The practice worked with an outsourced RCM services provider—and had some very troubling financial issues.
Processes in both front and back offices were inadequate—especially considering the scope of the practice. Billing practices were poor. Dollars due for major services, including surgeries, weren’t coming in. Also, we weren’t receiving payment for expensive retina drugs. Clinical excellence and high revenue figures hid the consequences of these faults to an extent, but I knew business management couldn’t remain status quo.
I felt we had to give our RCM vendor an opportunity to improve the situation. While we had to make changes quickly, I wanted to avoid making unnecessary changes. Here is the path I followed to better RCM.
Understand your current state
The first step in improving RCM is to gain insight into your practice’s current state. What billing practices have been working, what needs to change, and why? It’s important that your practice have good insight into its own financial data and metrics. If you don’t, it’s a sure sign change is needed. Lack of clarity into our practice’s own financial information made me decide to end the relationship with the then-current RCM services provider.
Consider your options
Three choices had now been narrowed down to two: build a full internal billing team or outsource RCM. At Loden Vision Centers, we still had the remnants of an internal team—billing staff who had been hired before we outsourced RCM and who had remained with the practice and were performing billing duties. We just needed a strong leader to take the helm to drive billing processes forward.
Do a cost benefit analysis
The next step in making a decision, was to consider the costs and benefits of each option. First, I considered the cost of rebuilding our internal RCM team.
For this option to succeed, we needed a strong leader. But what would it cost to recruit the right individual—someone with expertise in the business side of ophthalmology?
The labor market in Nashville is tight. Headhunter fees would be costly. But that wasn’t the biggest obstacle. We would need to initiate a search, identify qualified candidates, interview them, and then allow the chosen candidate to give notice to their current employer—a process that would take at least four to five months. I couldn’t wait that long to achieve results. If we could afford the cost of this option in dollars, we couldn’t afford it in time.
Understand the RCM vendor landscape
Outsourcing appeared to be the best option. That lead down us another decision-making path: finding the RCM service provider who would best meet our needs. Questions we considered:
- Do they have experience with the EHR and PM solutions we are using?
- Do the they understand the subtleties and nuances of billing in our specialty?
- What was the implementation timeline? How long before they were up and running?
- How quickly can they make an impact on our bottom line?
As the choices narrowed down, it become important to get references, especially from peers, both within our medical specialty and in other specialties.
Ultimately, it’s about the relationship
In the midst of the crisis over the practice’s billing and finances, the COVID-19 pandemic hit. I didn’t have four to five months to achieve results. The practice was owed a lot of historical dollars which we had not recouped. I wanted to get working on this ASAP.
Loden Vision Centers was using NextGen® Enterprise PM. I realized that working with NextGen® RCM Services, we could start chasing dollars left on the table, especially the Medicare dollars, faster than we could with any other outsourced RCM service provider.
Difficulty obtaining a clear view into our own financial data is a huge part of what triggered my search. A second factor that helped me make my decision was the abundance of metrics available from NextGen® Financial Analytics—accessible from my smartphone if I wish. This tool enables me to get a pulse on my practice’s financial status whenever I want. Using the dashboards, I can drill in by location and provider to look at any data point. I’ve used NextGen Financial Analytics to assess and improve the accuracy of medical coding.
More than anything, NextGen Healthcare’s RCM team is a partner. They listened to me. They understood our situation was dire and acted quickly. Now this partnership extends further—helping identify the need for business process changes and improving long-term strategy. When you view your RCM services provider as a true partner—that’s when you know you’ve made the right decision.