As the COVID-19 crisis continues, the pressure is on for orthopedic practices to become incredibly nimble at running their businesses. Practices must manage finances in an unpredictable environment and adapt how they operate. As one example, the abrupt on-again, off-again status for elective surgeries in many parts of the country creates an ongoing challenge to cash flow.
One lesson stands out from instability created by the pandemic: the need for greater focus on administrative processes. Now more than ever before, orthopedic practices, along with other specialties that rely heavily on elective surgeries, must embrace a more process-driven approach. To be able to work through the current COVID-19 crisis and come out on the other side, processes must be examined and improved.
5 Timely tips for orthopedic practices during an ongoing crisis
1. Scrutinize your business
Before COVID-19, many orthopedic practices could cover faulty business practices through increased productivity. For example, if a practice saw 60 patients in the course of a day but claims never got paid on three or four of those encounters, it was no big deal. The practice could sustain itself and operate profitably in this fashion. Since the onset of COVID-19, financial performance has received much more scrutiny. When productivity declines, it becomes important to account for every dollar earned.
2. Take denial prevention
Traditionally, orthopedic practices considered a 10-15 percent denial rate to be acceptable. Now many practices strive for a denial rate of about 5 percent, more in line with primary care and other medical specialties. This change in outlook is driving orthopedic practices to look more closely at what goes on in the front and back office
When reviewing denials, consider the types of denials you receive. Certain types will tend to occur more commonly than others. Typically, most denials are related to eligibility, benefits policy, authorizations, or medical necessity. Once you group denials by type, look more closely to see if you can find common threads. Examining denials will point you to processes that need adjustment.
3. Reconsider clinical documentation
Many orthopedic practices have opportunities to make improvements in clinical documentation. For example, consider making changes to electronic health record (EHR) templates to help ensure more accurate documentation—a tactic which can help prevent denials.
Most insurance companies have criteria orthopedic practices must meet before receiving payment for procedures. To meet these criteria, practices must provide documentation. Before the pandemic hit, many orthopedic practices were careless with this documentation. Now they're being more careful, wary of the potential of not getting paid. Significantly, these practices want to be paid the first pass. They don't want to have to go to appeal based on in notes in the chart.
4. Adapt your policy on patient collections
Orthopedic practices traditionally enforced strict patient collection policies. Once an elective procedure, such as a knee replacement, is done, a patient may not return for several years—which makes it harder to recoup unpaid bills. This reality led practices to develop and enforce policies on point-of-service collections, pre-surgery deposits, payment reminders, keeping credit cards on file, turning patient accounts over to collections, and so forth.
All of this changed with the COVID-19 public health emergency. Many practices turned off patient collections throughout the first months of the pandemic. These practices went for extended periods without sending out billing statements, identifying bad debt, or turning any patients accounts over to collections.
However, the patient collections valve can't stay off indefinitely. Now, orthopedic practices are going to have to reconsider their bad debt policy. How aggressive or how lenient can they afford to be as the COVID-19 pandemic lingers?
5. Find trusted partners and work with them
When the pandemic unfolded, the ability to get physicians up to speed on a telehealth platform quickly enabled many orthopedic practices to continue to see patients and in stay in business. Now, as the healthcare economy struggles forward, operational agility will continue to rely on having the access to the right technology.
Patients will want to do more tasks—such as scheduling appointments, filling out forms, and paying bills—online, to ensure their health and safety, as well as for convenience. Likewise, office staff will likely want to continue to work from home. The burden of adaptation will continue to significantly lean on health IT platforms and IT departments.
To remain competitive in this environment, make sure you have the best arsenal of technology tools at your disposal and the capabilities you need built into them. For this to happen, you'll need to work with a health IT vendor who does more than install systems—they should also serve as a trusted advisor to help you achieve administrative, clinical, and business goals.
The same applies to orthopedic practices that outsource revenue cycle management (RCM) services or are considering doing so. Having an RCM services provider that can serve as a trusted advisor is critical, especially as healthcare economy continues to adapt and adjust. Inconsistency in the business environment is hard for a medical practice to deal with and increases the need for reliable, consultative support. Learn more about how to manage better in an ongoing crisis.