Your KPI stats should follow the 4 C's for strengthened revenue cycle management: clear-cut, consistent, consequential, and connected.
For ambulatory surgery centers looking to strengthen their revenue cycle management, one of the first steps should be determining the most important key performance indicators (KPIs) to track. From the average age of accounts receivable (A/R) to cash collections as a percentage of net revenue, keeping tabs on these areas of an ASC's billing processes is essential to remaining profitable. But once these KPIs are identified, what step should come next?
Answer: The work. An ASC's revenue cycle KPIs are only as good as the data collected to determine them. With inadequate or confusing information, a surgery center could make decisions based on misleading statistics.
But don't fret. You can effectively track your ASC's KPIs by making sure your statistics follow the four "Cs."
For your ambulatory surgery center to truly benefit from KPIs, you want the data behind them to be clear-cut. In other words, data should be easily understood and calculated. For example, a KPI like "percent of A/R greater than 90 days" is straightforward and involves collecting basic, easily computed data.
As a revenue cycle management rule of thumb, avoid KPI calculations that create additional questions. KPIs should be easy to explain and leave no question about how or why you're arriving at a particular figure and decision based upon the data.
There's a reason why so many organizations, including ASCs, have trouble successfully managing their revenue cycle: Doing so requires time and commitment. Data for tracking ASC KPIs must be collected and analyzed on a regular basis. Once a month is a good target; weekly or even daily is ideal.
If you only look at your ASC revenue cycle performance once a year, as many facilities do, you may have difficulty identifying and understanding trends in the numbers. You may also discover an issue after it's already escalated and resulted in unrecoverable revenue. If data is analyzed routinely, potential problems can be discovered — and corrected — early.
When assessing your ASC's revenue cycle health, measure those processes that actually affect it. If what's being measured is not significant to the cash flow of your business, then it may not be necessary to track, collect and analyze frequently. Since there is essentially no limit to the amount of data that can be collected and measured, it is important to identify those metrics that matter most to your revenue cycle goals and performance.
It typically takes an integrated approach to improve ASC revenue cycle processes. That applies to both operations and the individuals in the revenue cycle chain. Stakeholders across the surgery center must believe in your KPI-centric plan, agree on how calculations are made, buy into the process, and be committed to making improvements based on what the data reveals. Everyone on the revenue cycle team must understand how their role in the process ladders up to the overall goal of improving revenue cycle performance. It truly is a team effort.
Taking Your ASC Revenue Cycle Performance to a Higher Level
KPIs neatly organize the information needed to highlight both the strengths and the weaknesses of your ambulatory surgery center's revenue cycle management process, but if you're not tracking them effectively, you could be left in the dark. When you're ready to delve into the world of data and analytics, remember to follow through with the above four Cs. They'll serve you well in your efforts to achieve the ASC revenue cycle performance you need and know is possible.