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P006: Facilities Management Division

P006: Percent of eligible third-party revenue collected at all agency facilities

Current Value

88.1%

FY 2018

Definition

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Story Behind the Curve

  • The Affordable Care Act increased the number of insured nationally. This increase puts more emphasis on third‐party billing and collections.
  • Collection of revenue is important to maintain services across the state. Greater revenue collection allows NMDOH to provide an enhanced level of care to our consumers.
  • The state's revenue fluctuates each year, and as a result the amount of General Fund appropriated to NMDOH is directly affected. NMDOH must strive to collect on other eligible revenue.
  • The FY19 eligible third‐party collection rate is as follows:
    • Quarter 1:  72.4%

        The target of 93% was not met.

  • Facilities maintained focus on revenue collection through regular meetings with managed care organizations and communication with Human Services to address billing/payment issues. Monthly actual and projected revenue reports for each facility/program were reviewed by the Administrative Services Division and discussions were ongoing with each Finance Director to assist with resolving collection issues. 
  • There are challenges with collecting revenue timely and efficiently at each facility.  Contributing factors for low collection rates, at any given time, are:
    • Electronic health record and/or clearing house (billing transmission) system issues
    • Limited billing staff (high turnover) to address both current and aged accounts
    • Staff not following proper Managed Care Organization (MCO) protocols (i.e. obtaining prior authorizations) in order to have an eligible claim for reimbursement
    • Rejection of billed service types that are not contractually recognized or newly established/negotiated between NMDOH and MCOs
    • Staff errors in claims processing
    • MCO system issues
    • High turnover of MCO representatives to assist and complete the follow-up of claims issues

          The strategies and actions in place will continue in an effort to increase the third-party collection rate.

Partners

  • Facility and Community Program Finance Directors and billing/collection staff
  • Managed care organizations
  • Commercial insurance providers
  • New Mexico Department of Health Human Resources Bureau
  • New Mexico Department of Health Administrative Services Division
  • New Mexico Human Services Department

What Works

  • Regular communication with the facilities and managed care organizations to resolve claims issues and outstanding payments.
  • Periodic communication between NMDOH and the New Mexico Human Services Department to resolve payment issues that occur with the managed care organization contracts, and to ensure regulatory and contract requirements are being met.
  • Sharing best practices and frequent collaboration among the facilities.
  • Dedicated staff focused on outstanding claims, questioning discrepancies, and following‐up on payments consistently and timely.
  • Monthly reconciliation of revenue to identify unpaid claims and issues preventing payment.

Strategy

  • Communicate at least monthly, and in some cases weekly, with managed care organizations and third‐party payers on unresolved claims.
  • Work with the New Mexico Human Services Department to address payment issues that occur with managed care organizations.
  • Assess personnel resources for maximum efficiency in medical coding, billing, and revenue collection efforts.
  • Perform monthly reconciliation of revenue for consistent monitoring of earned income and revenue collection.

Action Plan

  • Q1: Hold at least one meeting with an ASD and Facilities teams to gather information on the most significant issues affecting collection rates.
  • Q2: ASD to perform an analysis of the issues identified, brainstorm possible solutions, and identify required resources for at least one possible solution.
  • Q3: Develop and implement a plan, which includes allocating responsibilities and scheduling tasks, for at least one possible solution in an effort to improve the collection rate.
  • Q4: Monitor and evaluate the plan implementation.

FY18 Annual Progress Summary

FY19 Annual Progress Summary

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