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CAPC Palliative Care Discussion Forum
Billing and Finance
revenue benchmarksAuthor: CindyK
Date: Jul 15, 2010 1:25 pm
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1) compare the average paid rate to 100% of Medicare - if it is close, this is a good sign that things are going well.
2) look for the % of claims denied; also check whether they have been refiled and successfully collected. If the rate is higher than 5% or so of claims, look more closely for root causes and actionable items.
3) compare the % for your services to other non-procedural specialties (hospitalist, internist) and see if they are similar.
People often ask why the fee schedules are so high, if they are not collectable. There are various reasons - possibly there are a number of insurance contracts that pay a "percentage of charges" so this brings in revenue, or there are contracts that evaluate discounts on a year to year basis, so inflating charges is advantageous.
Also, to further complicate things, the professional services fee schedule and expected % of charges for collection usually varies significantly from the fee schedule and expected collection rate for the hospital Part A services...and the gap between billed and expected collections rates vary by type of service - some testing and procedures are marked up 400%, other services might be marked up 100%.
The best approach is to focus on expected payment rates from your 2-3 most frequent payers (including Medicare and Medicaid), model the payment x volume, and compare your expected revenue to actual - then focus on the gap.