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The Science Behind Orthopedic Revenue Cycle Management

While traditional business management education often overlooks the complexities of revenue cycle management in healthcare, medical billing is becoming more complicated than ever before, especially for orthopedic procedures.

In a compelling discussion hosted by the Journal of Orthopaedic Experience and Innovation (JOEI) podcast, Nader Samii, CEO, and Lisa Rock, President of nimble solutions, discuss the science behind revenue cycle management (RCM) for orthopedic practices.

Here are three RCM insights from their conversation to help orthopedic surgery centers and orthopedic surgeons improve revenue capture.

1. Chargemaster and Orthopedic Revenue Cycle Management (RCM)

Payer requirements and reimbursement can vary greatly from patient to patient. That’s why reviewing your orthopedic practice’s Chargemaster on an annual basis is fundamental.

The Chargemaster serves as one of the primary building blocks for revenue cycle management because it lists the billable fees for all procedures and services. Reviewing and updating the Chargemaster annually is recommended for compliance. This practice also prevents undercharging by ensuring charges are not set at a lower rate than the contracted amount.

Be sure to review your contracts when you review your Chargemaster and research additional information such as AMA coding updates, payer rate changes, and the latest costs for implants and billable supplies. This comparison will help ensure that you have a complete and accurate Chargemaster.

2. Orthopedic surgeons can improve revenue cycle turnaround times

Orthopedic surgeons play a pivotal role in revenue cycle management by providing dictation for each procedure.

To get paid faster and meet timely filing deadlines, orthopedic surgeons should dictate op notes as soon as possible, but also make sure notes are thorough. If the transcribed report is unclear, codes could be added correctly for the main procedures, but add-ons could be missed.

Another best practice that saves time is creating dictation templates, especially for your most frequent cases. Review your reports with coders every six months to look for any deficiencies in documentation or ways that the documentation can be made clearer. Then you can adjust your templates appropriately to ensure the right information will be captured each time.

An all-in-one transcription mobile app can also streamline your transcription workflow and integrate with your orthopedic practice’s revenue cycle. A mobile app gives physicians the ability to dictate, review, and e-sign reports from any location. Features can include automated push notifications to remind doctors of pending dictations and provide real-time status updates on all cases. Within the app, physicians can select the appropriate patient to dictate the case and ensure dictations are linked accurately.

3. Managed Care Contracts: the Financial Foundation for Orthopedic Practices

The reimbursement terms in managed care contracts set the foundation for your orthopedic practice’s financial success. Tracking specific Key Performance Indicators (KPIs) for orthopedics can turn contract management and analyses into real growth opportunities.   

The process of case costing, or tracking all costs associated with a case and comparing that to your reimbursement per payer, will determine your profit margin and if your managed care contracts should be renegotiated. 

When running a case costing analysis, it’s also important to track historical patterns and associated costs for each surgeon and each procedure. Depending on the terms in your contract, the reimbursement potential and overall cost for a procedure can vary due to a surgeon’s behavior. For example, the profit margin for total joint shoulder operation can vary due to multiple factors, such as the number of anchors used and the type or cost of the implant.  

As part of your denial management strategy, always ensure your revenue cycle management team has access to complete contract terms and keeps track of payer updates. For example, there are specific payer policies and requirements for billing orthopedic implants. Unless your team bills exactly the way the contract reads, your orthopedic practice could be at risk for denials. 

Reviewing contracts annually will ensure greater accuracy within prior authorization, coding, and billing processes. Analyzing the terms, fee schedules, and specific requirements outlined in managed care contracts also enables orthopedic practices to negotiate favorable terms, ensure accurate billing, and minimize claim denials.

Final thoughts on the Science of Orthopedic Revenue Cycle Management

While RCM is often thought of as a sequence of backoffice activities, such as front-end patient intake, dictation, transcription, coding, and billing, there are best practices within each process to ensure the right payment is received for each procedure.

Watch the full podcast episode below for more orthopedic revenue cycle management tips.