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Timely Identification of Take-Backs Using 835sDifficulty: Moderately Simple // Patient Financial Services
Why run this play?
Takebacks can happen unexpectedly and create a crisis that throws cash off target. Unfavorable audit results and expensive recoupments put a strain on slim operating margins. Fortunately, many takebacks are successfully appealable. To get takebacks under control, you need analytics that immediately identify when payers are taking back money from your organization. Then you can decide which takebacks to appeal and which to accept, and ensure your financials are updated in a timely manner.
Background
Audit review on claims can occur long after they are submitted to the payer. When there is an unfavorable result, and the payer takes back payments, the provider has an opportunity to appeal the decision. According to an HFMA article titled “RAC Recoveries Increase, as Problems Persist”, about 63 percent of the overpayments collected in 2016 were for inpatient hospital claims, and the overturn rate for Medicare Part A hospital claims was 38 percent, an increase from 22 percent in 2015.
For example, one of our clients had a payer that was taking back large sums of money for patients who were discharged over a year ago. With their current HIS platform, our client had no visibility as to when this was occurring. With a simple report, they were able to identify the issue and create an automated process that uncovered any further recoupments.
Take Action
- Set ‘Y’ for all accounts with a Claim Status Category = Reversal, with a payment amount greater or less than Zero AND Zero payment received on date, Greater than or Equal to the same Remit Date as the Reversal Date. Else N.
- The flagged account should change to N once a remit with a payment is posted.
- Look at this report daily to see if anything qualifies.
Want to see how to run this play in VisiQuate?
Request a demoHow to Calculate This Play's Value
The value of this play is measured in two different ways:
- The value of adjusting Cash expectations. If a forthcoming recoupment or takeback is known, it can be broadcast to the operations team (especially the Medicare Team) and to the Finance department. It is recommended that Cash to Target by Payer is measured daily, which will highlight recoupment topics.
- Delaying/defeating a takeback request. A policy can be developed for payers that do not practice offsets but make a request for payment to the provider instead.
- In this case, once identified, the account can be isolated and contested. When a Takeback or Recoup effort is successfully defended, the value is similar to a denial overturn, since at risk Cash is protected.
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