Outsourcing administrative tasks
by Jeremy Crow

A year has passed since one of the most significant changes to payment models in decades took effect—and, 11 months into the COVID-19 pandemic, home health and hospice agencies are  continuing to wade through a number of challenges and economic pressures.    

The introduction of the Patient Driven Groupings Model (PDGM) in January 2020 affected tens of thousands of agencies that maintain the delicate balance of running a business and providing the care their patients need. On top of these changes, the pandemic has shaken the health care industry and altered the way care is delivered to patients both in and out of the hospital.

In today’s environment, homecare and hospice agencies are facing a reimbursement squeeze from the Centers for Medicare & Medicaid Services (CMS), a sharp decline in census due to widespread cancellations of elective surgeries, cancelled visits in general and restrictions on where existing visits can take place.

Managing cash flow—the lifeline for any business—has become more important than ever. However, no one gets into home health or hospice because they want to spend their days crunching numbers, filling out forms or keeping up with ever-changing reimbursement requirements; those who join the industry do so to provide high-quality, high-touch care to patients. Outsourcing billing and coding needs to a third party will not only free up valuable time that can be directed back to patient care or other strategic initiatives, but can also help agencies become more profitable overall.

Building a Relationship

A successful relationship with a revenue cycle management (RCM) partner allows an agency to forgo the day-to-day administrative tasks behind billing and coding, leading to a number of agency-wide benefits. Outsourcing RCM also allows agencies to focus on recruiting top clinical talent, rather than filling administrative roles. An RCM partner employs top-notch talent, trained on an ongoing basis and coached specifically in how to help agencies achieve maximum reimbursement and cash flow within a changing regulatory landscape. A scalable partner is also able to follow an agency’s journey as it contracts—and ideally expands—to adapt to changes in the industry, such as COVID-19, by providing the necessary talent to meet evolving workloads. As a leader, one of the most challenging responsibilities is to get the best return on your organization’s assets. Partnering with RCM services enables a potentially greater return with one of an organization’s most valuable assets—people.

The key to picking the right RCM partner is to consider several aspects that help define success for a homecare or hospice agency, including:

1. Performance Indicators

A straightforward indicator of a partner’s success is to look at industry standard performance areas, such as days to claim, accounts receivable days by payer type, collection rates by payer and percentage of write-offs by revenue.

The quality of an RCM partner’s work will directly affect a business’s cash flow and would be properly reflected in their data.

2. Expertise

As a direct extension of an agency’s billing and coding department, it’s important that potential partners demonstrate expertise in regulatory affairs and customer success. A dedicated regulatory team that maintains a pulse on the industry and liaisons with their agency partner to communicate key changes will help guarantee more short- and long-term success in a rapidly evolving regulatory landscape. Another aspect to consider is how long the RCM service provider has been in business, as its history and relationships could be an indicator of its expertise.

3. Timing

In addition to its knowledge on the latest regulatory changes and the industry overall, a partner should be able to adapt quickly to any changes.

The turnaround time it takes to get coding done directly impacts an agency’s success. Timeliness to submit claims, address errors and post payments also impacts an organization’s health. From day-to-day operations to industry-defining policies, agencies should be able to expect their revenue cycle services to work congruently with the pace of their needs.

4. Quality Assurance

Along with providing timely service and industry expertise, a good RCM partner can also augment an agency’s quality and education program. When thinking about Outcome and Assessment Information Set (OASIS) documentation, it’s critical to ensure that every answer is as accurate as possible, as OASIS recording directly impacts both payment and star ratings on’s home health agency comparison tool.

For example: What “M” questions do your clinicians most often struggle with or need guidance on? Are they competent on the “GG” and “J” items? How often does the primary diagnosis need to be changed? Are you capturing all pertinent diagnoses to maximize PDGM clinical grouping as well as low and high co-morbidities? With PDGM, all the rules have changed. These are key inputs into your ongoing training and quality program—and elements an RCM partner can help address.

Measuring Your Relationship

A healthy relationship with an RCM partner is the same as any other business partnership. It should have clearly defined roles, processes and handoffs so agencies know who is doing what at what time and how that information will be communicated back and forth.

Success can also be defined by measuring the key performance indicators mentioned above, like days to claims, aging percentage of write-offs and turnaround time. Days to claims is a strong indicator of cash flow and how well the agency and partner are working together, as both the RCM provider and agency are dependent on one another for positive outcomes. The aging percentage of write-offs and turnaround time are factors in how RCM partners measure themselves and also directly impact the success of the partnership. A helpful RCM provider can be expected to provide these metrics proactively via a report card of sorts.

Managing Risk

As with every business relationship, there is always perceived risk in pursuing a new partnership. However, revenue cycle services are a good, low-risk way to offload day-to-day responsibilities so agency-centric talent can work on more specialized tasks, including freeing up time for management to dedicate to strategic and long-term initiatives.

Evolving for Success

Today’s agencies need to be agile in order to best meet evolving industry demands, from redefining care visits to staying up-to-date on regulatory and policy chances. Outsourcing day-to-day tasks like billing and coding to an RCM partner creates more time and energy to focus on caring for patients, while providing more resources and opportunities to maximize reimbursement and cash flow.

While current business models may work for many agencies right now, a major takeaway from 2020 is that adapting to sudden and unexpected change is what truly defines the success and longevity of a business.

While a system may not be broken, there is always room to make it better.

Jeremy Crow, PMP, is director of revenue cycle services at HEALTHCAREfirst. He has more than 15 years of experience supporting clinical and financial operations for a range of healthcare organizations, most recently consulting for home health and hospice businesses at Simione Healthcare Consultants. He has served as a senior software executive, information technology consultant and certified project manager.