Finding Patients with Insurance Who Are Medicaid Eligible
Medicaid eligibility can be a huge source of untapped reimbursements for providers of every size. By identifying patients who presented as self-pay but are actually Medicaid eligible, providers can grow their revenue by up to 10% annually, according to a study byTransUnion.
- The analysis is based on more than 50,000 cost reports over 10 years and included from 100 various providers that are considered mid-sized.
- That translates to more than $500,000 over a three-year period in recovered revenue for the average mid-sized hospital or larger clinic.
How Medicaid Eligibility Increases Revenue Recovery
As of January 4, 2019, 37 states, including DC, have adopted Medicaid expansion, according to the Kaiser Family Foundation. And more states are expected to expand coverage before the year is out. While the expansion of Medicaid is resulting in more Americans being covered, there are still a lot of people without health care coverage. Consider this: In 2017, there were still 27.4 million non-elderly people in this country without healthcare coverage.
This presents a huge opportunity for providers to get more revenue from different sources as many of those uninsured patients could be eligible for Medicaid, depending on your state’s expansion status and active demonstration waivers. Why is that so important? Because 63% of all bad debt recoveries are related to patients eligible for Medicaid who presented as self-pay at the time of treatment and are consequently written off as bad debt.
Maximizing Your Returns
In 2018, approximately five percent of self-pay accounts that end up being discarded and written off as bad debt were actually eligible for Medicaid or Medicare insurance that could've been billed at that time. While five percent may not seem like a lot, it's actually a huge opportunity to maximize your revenue recovery. It's incredibly important to ensure that earned revenue translates into revenue you get paid.
Developing A Solid Revenue Collection Strategy
Consider this: In 2018, Sage Growth Partners discovered that two out of every three hospitals have over $10 million in debt. What's more astounding is their finding that most hospitals, large practices or urban clinics don't have a strategy to recover revenue. A baseline strategy to increase your revenue collection is to first examine all areas of potential revenue leakage.
Getting an extra five percent of accounts to pay can make a significant difference on your AR. Ultimately, this allows you to increase your income collections and improve cash flows, both of which can be invested back into the organization to fuel operations that result in higher levels of quality care.
In doing so, centers, hospitals and practices alike can also focus more of their budgets on acquiring top talent healthcare professionals as well as invest in the latest technologies that enhance compliance, support better care coordination and improve patient outcomes.
Check All Patients for Dual Coverage
As mentioned earlier, there's a significant opportunity for collecting AR from patient encounters that are dual-eligible for Medicare and Medicaid, or even commercial insurance that they may not be aware of though family or employers. Having your front office staff trained to ask and a process in place to identify potential coverage decreases denials and collection time.
Document Bad Debt Collection
Make sure you document in detail all of your bad debt and keep up to date on changes to the Medicare Physician Fee Schedule (PFS). Medicare, for example, currently pays 65 cents on the dollar, based on the CY 2019 MedicarePFS Final Rule, updated November 1, 2018. In addition to policies affecting the calculation of payment rates, this final rule finalizes a number of documentation, coding, and payment changes to reduce administrative burden and improve payment accuracy for office/outpatient evaluation and management (E/M) visits over several years.
Having a good documentation system for both commercial and government insurance will help you identify trends in your bad debt write offs so you can process patient encounters as per current rules.
Engage with Partners That Can Enhance Your RCM
The decision to outsource revenue services often involves much more than ROI. Some practices choose an RCM vendor because it can improve staff productivity and boost morale, in addition to increasing revenue. According to a HIMSS Media Research Study, more than 8 in ten finance, revenue cycle and healthcare IT leaders call clinical documentation and coding a high or medium risk area for lost or decreased revenue.
Outsourcing RCM ensures claims are submitted correctly the first time. It decreases collection expenses by taking advantage of procedures that reduce the overall revenue cycle process. And when claims are rejected, you can analyze them ensure future denials are minimized--or to make a solid case for appeal. A strong partner will leverage the findings and educate your front office and clinical staff on errors that can be avoided in the future, thus improving outcomes.
Strengthening Medicaid Reimbursement -A Real-World Example
As complex as the Medicaid environment might be, a focus on recovering retroactive Medicaid in self-pay can help you collect every dollar possible for uncompensated care. This process starts with a trustworthy, low-risk vendor partnership that aligns with your organization’s goals.
In October of 2016, a provider with significant self-pay volume and average monthly Medicaid revenue of $350K implemented a new technology-enabled service to identify, bill, and collect retroactive Medicaid reimbursement.
The service—Altruis RetroPay™—enabled the automated monitoring of all self-pay encounters not yet reimbursed that had not yet passed timely filing deadlines. When billable coverage was identified, eligible encounters were automatically billed and collected.
- In the 6 months following go-live, RetroPayTM captured $750K in retroactive Medicaid reimbursement, and $145K in additional incremental MCO reimbursement for patients identified through RetroPayTM - $895K in revenue that otherwise would have been written off.
- In month 6, baseline monthly Medicaid revenue was up 78% compared to year-over-year average - $650K vs. $350K.
That’s significant, especially for providers operating on tight financial models. And while the dollar amounts are impressive, what’s more meaningful is the impact—more resources and services to support the health of local communities.