TPC’S Zero Balance Reviews Help Member Hospitals Recover Lost Revenue
Billing and collection in the healthcare system is highly complex. Authorizations need to be received, benefits are often restricted, many services are subject to deductibles, and in-network versus out-of-network coverage must be monitored. Even after payment is received, there are new challenges. Employees must record these transactions within systems, tracking payments, denials, balance transfers, and adjustments.
Due to limited resource availability, providers typically don’t review the accuracy of paid accounts. A third-party review can help identify discrepancies, such as underpayments or denials, and an appeal process can be initiated to help providers recover cash. Even if money can’t be recouped, this process provides transparency in the revenue cycle.
Zero Balance Reviews
Zero balance reviews should be a part of every hospital’s revenue cycle process to ensure they’re not leaving money on the table. Zero balance reviews provide information on how accurately payers have paid their bills.
Where do underpayments come from? Typically, they come from managed care plans that have not processed claims according to the contractual agreement. Often, hospitals do not have funds to purchase tools to help identify the underpayment, or have the staff to adequately work the account.
Issues with payments may include the following:
- Claims with multiple errors
- Payer not remitting add-on payments
- Outlier remittances being underpaid
- Payers switching out DRGs (Diagnosis-Related Group) to lower the complexity, but also to reduce payment
According to recent data from the American Medical Association, 7% of paid medical claims had errors.[1] The AMA also found denied claims averaged about 5%. Other studies show that 50% of denied claims are not filed, 90% of denials may be preventable, and up to 67% can be recovered if appealed.[2]
TPC’s Zero Balance Review
TPC has partnered with a company that provides zero balance reviews. The zero balance program includes program implementation, cash recovery, staff education opportunities, and an opportunity to correct the gaps causing the denials or underpayments. It all adds up to a reduction in denial opportunity.
Using the combined purchasing volume of community-based, independent hospitals gives TPC Members negotiating power. Prior to the launch of this initiative, four of our Members did not have a zero balance review program in place. As a result, the Revenue Cycle Council issued an RFP to find a suitable vendor, and one sole provider was selected to work with TPC Members.
The implementation of this program has provided significant positive results. In the first year of the program, $1.6M was recovered for Members. And in addition to revenue gains, Members were able to close the gaps on denials and underpayments, as well as correct the root causes of their collection issues.
Zero balance reviews are complex, but they allow hospitals to better understand their revenue cycle, and ultimately improve it. With the right technology, training, and system, zero balance reviews can help hospitals correct ongoing errors, increasing collections in the future.
TPC and You
TPC provides the framework for independent, community-based hospitals to achieve system value through standardization, utilization, and strategies that optimize operational, financial, and clinical performance.
Within TPC's Revenue Cycle Programs, TPC Members can take advantage of zero balance reviews through a single provider. This program can help members recoup revenue that once was thought to be lost, as well as identify gaps in the billing and collection process.
Stronger Together. Superior Results.
To learn more about TPC’s Revenue Cycle Services and how zero balance reviews can help your hospital uncover lost revenue, visit TPC online today!
[1] https://www.beckershospitalreview.com/finance/there-s-gold-in-the-zero-balance-review.html
[2] https://www.fcc-cpa.com/healthcare-consulting/zero-balance-and-underpayment-review/