One of the top challenges facing the healthcare industry and the revenue cycle is the medical billing system. The medical billing system encounters many obstacles due to the changes that occurred (and continue to occur) during the COVID-19 pandemic as well as the complexity of the billing system itself. Along with increasing regulations and standards, healthcare providers need to find ways to streamline the billing system. Because the billing system is repetitive in nature, it makes the perfect process to implement digital transformation.

Business automation in the medical billing system increases efficiency, speeds up payment posting, and improves the revenue cycle. The medical billing system is often the first element to be automated in the revenue cycle, usually because providers may be using an outdated billing system or notice higher claims denials. Employing automation in the billing system helps providers to enhance the process, avoid surprise bills, and focus more on patient care while reducing spending.

Complex Processing of the Billing System

Rather than being handled by a single department, the medical billing process requires input from multiple departments including the billing department, administrative department, and clinicians. With so many seemingly unlinked departments working together, there's bound to be room for error, slow processes, and inefficiencies.

Also, healthcare providers don't typically receive payment upfront. They first work with payers for reimbursement before deciding if they need to bill a patient and, if so, for how much. Healthcare providers need to consider a patient's copay, medical coverage, and insurance eligibility. At the same time, providers need to confirm that claims are accurate with the proper medical codes to avoid denied claims.

Business Process Automation Improves the Revenue Cycle

When it comes to enhancing the revenue cycle, the medical billing system needs to be taken into consideration and healthcare providers need to consider how business process automation fits into their overall digital transformation and revenue goals. According to a 2021 CAQH report, transitioning to fully electronic transactions could save the healthcare industry 48% of annual spending. There are various customizable digital solutions that healthcare providers can rely on to make repetitive tasks more efficient, free up resources, and ultimately, reduce spending.

Fewer Denied Claims

Currently, healthcare providers report that claim denial rates are between 6% and 13%. A denied claim is lost revenue and many claims are denied due to minor errors. With business automation such as Exela’s Lockbox, healthcare providers would see fewer denied claims.

Exela’s Lockbox improves the first pass rate of claim submissions by identifying and flagging medical coding and billing errors before the claim is submitted. By increasing the number of clean claims submitted, healthcare providers receive reimbursement more quickly.

Along the same line, once a claim is denied, it requires the provider to decide if the denial needs to be appealed, the claim needs to be adjusted, or the patient needs to be billed. Business automation solutions such as Exela’s Lockbox increases the recovery rate on denied claims thanks to a tool that presents the original claim along with all the related information in a single view. This makes it easier for the billing department to decide the next steps to recoup the payment.

Mitigate Human Error

As long as there are manual processes in place, claims will always be prone to human error. With claims being denied based on the smallest inaccuracy, healthcare providers can easily lose revenue due to human error. Automation ensures accuracy, removing another obstacle toward streamlining the revenue cycle.

Digital Document Management

Paper systems are inefficient, tedious, and risk documents being lost. Healthcare providers are choosing to transition to digital documents and digital archives to store all pertinent data and information. Exela’s Lockbox converts paper EOBs into EDI 835 remittance files while also providing full support for paper and electronic payments.

Providers can also access information such as EOBs and other data through Lockbox’s secure web portal. With a simple search, a provider can find exactly what they're looking for rather than manually sifting through paper files.

Increase Speed of Payment Posting

Due to the different departments being involved in the medical billing system along with any outdated system that's currently in use, the path toward payment is going to be inefficient and significantly slower. By using automation tools, healthcare providers reduce the time it takes for payments to post, giving them faster access to deposited funds.

Let Business Automation Improve the Revenue Cycle

While the medical billing system is a great place to start for digital transformation in healthcare, healthcare providers can find a myriad of business automation processes that can enhance their revenue cycle, and encourage them to save money while increasing patient care.

There's no one-size-fits-all when it comes to a solution, which is why healthcare providers should determine what needs to be prioritized in their own organization. Whether healthcare providers start automating the medical billing system or automate a different facet of a healthcare process, it's high time that the industry embraces digital transformation.

For any hospital, healthcare network, or physician’s office faced with the challenge of managing complex payment processing operations, medical lockbox service providers make for essential partners. Medical lockbox services can help to automate and accelerate slow, manual in-house processing; maintain compliance; avoid errors, bad debt, and write-offs; and shorten the revenue cycle.

A capable lockbox partner with EOB to ERA conversion tools eliminates the manual cash posting, facilitates auto posting directly in the provider’s patient accounting system, and reduces the hassles of cash reconciliation. On top of that, the 2019 CAQH index showed the provider cost of manual remittance to be $5.35, while an electronic transaction only cost $1.78, for an average savings of $3.57 per transaction.

There’s no question that this kind of service provides significant value to healthcare providers. The only question is: how do you choose the right one?

Here are 4 key things to consider while selecting a medical lockbox partner:

What Kind of Payments Can Medical Lockbox Accept?

The act of requesting and accepting payment sounds simple enough, but as ERAs, paper EOBs, ACH, checks, credit card payments and associated correspondence add up, managing the totality of the accounts receivable work stream can get pretty complicated. In fact, in absence of a standardized form, the number of templates a provider may need to deal with could be as high as the number of payers - sometimes reaching upwards of 20,000 EOB templates.

A good medical lockbox solution is designed to simplify and streamline processing of healthcare receivables, regardless of payment type. And the best options should be capable of handling your payments, regardless of the format in which they arrive.

Is it PCI and HIPAA Compliant?

Lockbox solutions are great for healthcare providers, but they aren’t unique to the healthcare industry. When assessing a lockbox solution, be sure to assess its level of compliance and whether it was built specifically for healthcare companies or if it is intended as a more general solution. Issues arising from gaps in compliance cost the average hospital about $47,000 per bed, or $1,200 per patient annually. Healthcare and finance are among the most regulated industries in most countries, so finding a solution that emphasizes compliance is particularly important.

Does it Help Reduce Claims Denials?

Denied claims make up 15-20% or more of the average provider's total claims volume. Consider as well that variances in EOB documentation templates can add confusion and slow down payment processing even when things go well. Additional processing work, correspondence, and back and forth between provider and payer result in increased costs and decreased efficiency. Improving your recovery rate through automated data management and reconciliation, and a more streamlined denials management process can significantly improve your bottom line.

Does it Improve Process Transparency?

A lockbox solution that compiles and organizes transaction and payment data and provides in-depth reporting can help you gather the bigger picture and find ways to improve. This goes for just about any new solution you may be considering, especially when it comes to managing and optimizing complex processes.

Look for a lockbox solution that increases your visibility into the metrics that matter and provides flexible reporting capabilities so that you can gather the insights you need to help optimize your system. For example, Exela’s ability to convert proprietary denial codes to industry standard Claim Adjustment and Remarks Codes (CARC) helps ensure proper accounting of denials and application of cash to appropriate patient and adjustment accounts.

How Does Exela Do it?

Exela has been providing lockbox services for over 30 years, and our Medical Lockbox solution has built upon our success to provide payment processing solutions that address the specific needs of healthcare providers. Our lockbox services can be integrated with add-ons such as Revenue Integrity Services, Medical Coding, Audit Consultation Services, Denial Management & Analytics, Appeals Grievances Services, Medical Record Management Services, and Collections to name a few. Taken together, these offer a cost-effective, efficient, and comprehensive medical lockbox system for healthcare providers.

- Exela offers omni-channel intake of both digital and paper formats to create a comprehensive, centralized processing system.

- Paper digitization is achieved through our in-house scanning platform and intelligent character recognition (ICR) technology, which enriches data to provide benefits beyond typical OCR engines. Our automation solution is capable of supporting non-standard claims and variations within claims.

- Payments from all sources are quickly and accurately converted into 835 electronic remittance files, which can be posted directly to medical billing systems, resulting in improved accuracy and quicker turnaround time, benefitting the end customer.  

- The web-based denials management tool provides a simpler and more direct workflow through which denials can be addressed. The original claim and related remittance information is given in a single view so that users can easily determine if they should adjust the claim, bill the patient, or appeal the denial, further reducing expensive processing time and cost.

- Automated processing of EOB templates results in fewer denied claims and greater clarity in tracking and resolutions of denials, improving the payment recovery process.  

- Detailed reporting supports reimbursement and performance analytics that improve process auditing and contract negotiations with payers.

Learn more about Exela's Medical Lockbox Services.

Digital transformation in healthcare continues to be a key topic in many healthcare leaders' minds. Healthcare providers of every size face the same challenge of improving patient care and engagement while managing costs. However, many obstacles create complications including limited staffing, outdated systems, payer contract complexities, and more. By embracing digital transformation, healthcare providers can begin to tackle these obstacles and accomplish their goals for the future.

Digital transformation in healthcare affects many aspects of the business from freeing up resources that can be devoted toward patient care and increasing patient engagement to improving operational and financial efficiencies. With AI, automation, and technological advancements, the healthcare industry stands to gain improved processes, quicker payments, and fewer claims denials.

Digital Transformation in Healthcare Starting with Automated Claims Processing

Claims management and processing is a major operation in need of digital transformation in healthcare. This is often a thorn in healthcare providers' sides because of its complexity. Claim denial rates are between 6% and 13%, which eats away revenue.

These statistics highlight the importance of submitting clean claims right from the start. However, this is easier said than done especially when relying on manual processing and outdated systems. Many healthcare claims are being denied for simple reasons such as a spelling error, incorrect coding, missing patient identify information. Given that healthcare organizations' resources are stretched thin, it makes sense that claims processing would be vulnerable to human error.

Once again, digital transformation in healthcare can step in and smooth the process. Exela is a leading claims processing provider with a solution that enhances claim processing by unifying data from all incoming communication channels, performing pre-submission checks to create clean claims, and intelligently routing correspondence for optimal processing using automated decisioning. Exela’s Healthcare Claims Processing solution reduces denials and resubmissions by applying business rules to produce clean claims prior to submission. Using automation and artificial intelligence, Exela increases transaction processing rates and accuracy while reducing manual processing and rework.

Take Complex Claim Processing Further

According to a 2021 CAQH report, only 21% of medical administrative transactions are digital while the rest are paper. Exela leverages exclusive vendor contracts with leading health plans for complex paper claims processing.

Embrace digital transformation further with Exela's PCH Global solution, a powerful digital platform that not only provides a single point of access for claims management but provides a central bridge between all parties including the provider, payer, and patient.

PCH Global promotes clean claim submissions by identifying certain-to-denied claims, thereby improving first-pass rates. Its iterative feedback loop technology helps the system continuously learn and improve to identify errors enabling proactive claims management with system flexibility as your contracts change.

Finally, the system automatically tracks and records any addition, deletion, or modification to transactions along with user reference and timestamps providing clear audit trails and ensuring full compliance.

Digital Transformation of Remittance Payments

The 2021 CAQH report determines that the healthcare industry could save 48% of annual spending by transitioning to fully electronic transactions. Manual processing significantly slows down operations especially when human errors are taken into consideration. Automation streamlines this process reducing errors, posting payments quicker, and improving overall efficiency making it a terrific place for digital transformation in healthcare.

Exela's Medical Lockbox simplifies the healthcare payment process by digitizing and automating manual, paper processing tasks. Using a state-of-the-art scanning platform and intelligent OCR/data capture technology, Exela’s Medical Lockbox solution converts paper EOBs from any source into 835, electronic remittance files, payment reconciliation and posting to the healthcare organization's medical billing system. By streamlining the payment path, Exela’s Medical Lockbox solution reduces the time it takes for payments to post and allows quicker access to deposited funds. Submitting secondary claims or patient billing, depending on the patient’s coverage, makes the payment cycle faster from Primary, Secondary, Tertiary or Patient payments.

Not only does Exela's Medical Lockbox streamlines payment processing, but it also features a web-based denial management tool designed to increase the recovery rate on denied claims. This web-based management tool presents the original claim and all related remittance information in a single view simplifying the process for users to adjust the claim, bill the patient, or appeal the denial. Insights are gleaned through reimbursement metrics presented within Exela’s Medical Lockbox’s configurable reporting function. These insights are valuable with billing system audits and contracts negotiations.

Automated Contract Management

Healthcare payer contracts vary greatly, each having different policies, regulations, and parameters. The contracts of each insurance company are often revised and updated annually so healthcare organizations need to renegotiate several payer agreements every year.

Keeping track of the current contracts and any annual updates is an enormous task that burdens healthcare resources. Without a handle on contract management, healthcare organizations are vulnerable to underpayments which affect their bottom line. Contracts and underpayment management are yet another place where digital transformation in healthcare is needed.

Exela’s Revenue Integrity solution automates the contract management process, document scanning, indexing, profiling, loading and maintaining all third-party payer agreements. Agreement terms are tracked and providers are presented with notifications of important dates as well as amendments and updates. Instead of using limited resources to keep track of contracts, automation is ready to step in.

Exela’s Revenue Integrity solution also offers predictive contract modeling that provides accurate reimbursement calculations for current and future contractual agreements. By providing multiple scenarios and utilizing the most recent one-year patient data set, the platform presents the net dollar and percentage increase or decrease.

This solution also identifies retrospective, current and prospective underpayments from all contractually obligated third-party payers.

Summary

Digital transformation in healthcare opens many doors and it’s time providers embrace the opportunities available to them. AI and other technologies are ready to streamline antiquated processes, increasing efficiency and accuracy while freeing up personal time.