When it comes to personal health, people typically try to avoid getting sick. We get vaccines, we try to get regular exercise to control our weight and strengthen our hearts, and we wash our hands to avoid communicable disease. "Preventive care" means making decisions in the present based on statistics that show such activities will most likely ensure a healthier future. It's proactive. The alternative isn't fun—trying to make oneself better after becoming sick. That's reactive, and far less productive.
Proactive thinking—doing something now to prevent problems later—can also be applied to revenue cycle management. It's about making decisions based on data and analytics rather than adopting a "wait and see" strategy where you do nothing or postpone action, putting off dealing with potential problems until after they turn into serious issues.
Wait and See isn't the Best Strategy
In a typical reactive approach, a facility performs services, files claims for those services, and then essentially "waits and sees" if they are reimbursed for the maximum amount. Some of these services could cost the center more money than anticipated, and it's only after receiving less payment than expected—or no payment at all—that the center might investigate the situation and course-correct so that it doesn't happen again. Additionally, with days to bill often exceeding 30 days, the service could be performed many times before anyone realizes something's amiss. The mentality is commonly "this didn't work, let's change it," when, instead, a center should evaluate its practices ahead of time based on available data and analytics. Think of it as preventive care for your revenue cycle.
Technology and Data for Revenue Cycle Wellness
Technology allows us to collect data and run analytics to determine if there are issues affecting the financial health of an outpatient facility and can illuminate the changes that need to occur to fix them. Instead of performing a service, filing claims, and hoping the reimbursement covers the necessary costs, a facility could use data and automated analytics to determine cost at the case level as well as the amount of expected reimbursement. If the analysis shows that the costs outweigh the profits, the individual metrics can provide insight into what adjustments should be made to maximize revenue.
Technology makes sure the data isn't just collected, but that it's also consumable and actionable. Using information to assess your center's performance routinely gives you the ability to understand where and how you need to focus to proactively improve the health of your revenue cycle. The alternative? Wait and see, then react. However, if you wait too long, you could end up in a financial hole that is difficult and expensive to climb out of.
For your revenue cycle, proactive really means preventive and profitable: building a solid plan and doing regular checkups to maintain a healthy bottom line. Reactive means letting problems develop and hoping you are able to repair the damage. As the famous proverb says, an ounce of prevention is worth a pound of cure.