Improve profitability through outsourced revenue cycle management (RCM)
In recent years, reimbursement cuts have proven to be incredibly challenging, testing even the most experienced HME/DME providers. The fluctuation of insurance deductibles also creates challenges to managing a profitable business. Providers are searching for ways to gain greater agility so they can better adapt to market conditions while maintaining profitability and gaining a competitive advantage. One of the most common solutions for this is outsourcing.
How Cost, Staff, Technology Shape Our Decisions
Outsourcing is quickly becoming essential for scalability, cost and staff management, and access to expertise and technology resources that allow providers to focus on their core business of patient care instead of their non-core back office billing and collection functions. The industry is constantly shifting, and providers must shift with it.
Cost and staff management have become a top priority. One of the most common reasons companies consider outsourcing is to reduce overhead costs. Another factor which drives providers to outsource is a variable cost model that takes into consideration the fluctuation in your volumes rather than having a high amount of fixed costs for handling billing in-house. Outsourcing helps free up capital and personnel resources to invest back into the core business. Outsourcing revenue cycle management can ensure that owners no longer bear the burden of recruiting, hiring, training and managing only to cover the fixed cost of absenteeism, paid vacations, and the impacts of employee turnover within an internal billing department, instead leaving the responsibilities to a large professional organization.
Because an outsourcing provider makes the HME’s non-core business its sole focus, the outsourcer can leverage its expertise in both billing process and software platforms to achieve higher levels of efficiencies. This allows HME providers to focus more attention on delivering quality patient care. One example area would be automated technology. Many HME providers print and sift through monthly reports and other material,then manually print, stuff, and mail invoices. An outsourced provider has automated technology for increased efficiencies such as electronic invoice delivery or automatic recurring monthly payments. An outsourcing provider can also be your one technology partner instead of a provider using multiple vendors that an HME owner would have to manage for the services they need.
Selecting the Right Partner to Avoid Costly Mistakes
Choosing the right partner to support your HME business can be a challenge.
In the past, outsourcing was leveraged only to lower costs, but no improvements to the process were made. Today, outsourcing providers know that to differentiate themselves from the competition, cash flow insight and process improvements paired with cost savings is a given. With new outsourcing providers appearing on the scene, HME providers must be aware of vendor selection best practices and management. The reality is that not all vendors are created equal.
Here are the top four considerations to select the right partner and avoid costly outsourcing mistakes:
|1.||Look for an outsourcing partner that can execute and provide transparency into its services. Equally important, never rely on vendors that cannot show you success. If they cannot illustrate statistical results, they are likely not a good choice.|
|2.||Look for a partner that not only has a competitive price point, but also strong industry expertise and a proven track record in providing consistent and reliable service. An experienced partner is needed with the changing reimbursements rates as well as the ability to transform a business model. In addition, a provider that relies on one individual to deliver results will add uncertainty and inconsistency to the operations. You must have a strong team.|
|3.||Experienced providers leverage data and analytics to provide recommendations to enable process improvement. Industry experts analyze the data and ensure that the recommended methods provide confidence in consistent and predictable cash flow and provide cleaner claims processing and faster follow-up on aging A/R.|
|4.||Look for a vendor that offers a suite of services rather than selecting multiple vendors. Working with one vendor partner that can provide more services is key to mitigating risk and giving you the flexibility to adopt other services if and when needed.|
Outsourcing to Gain a Competitive Edge
Outsourcing can be a highly effective solution to gain a competitive edge. By leveraging the right outsourcing partner, HME providers can better manage change and move toward a more flexible operating environment.
Selecting the right vendor requires careful evaluation. Look for a provider that can demonstrate expertise and provide collaborative solutions that drive efficiencies and ensure you have maximum reimbursement rates and consistent cash flow necessary to remain competitive.
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