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Greg Koller is Chief Strategy Officer, Revenue IQ, which specializes in automated remittance and status transactions for healthcare organizations. Koller has more than 25 years of experience in improving healthcare technology and revenue cycle processes. He specializes in electronic transactions that help dental practices and dental services organizations achieve meaningful business improvement.
ental practices often treat payment posting as an “out of sight, out of mind” activity. But the inefficiencies associated with manual payment posting result in more than lost productivity and higher transaction costs.
Productivity is the top concern of dental practices, a 2019 survey shows, and most practices are focusing on increasing production by adding new services or reducing overhead through supply management. But one of the most common productivity challenges dental practices face is around payment posting, a highly manual process that is rife with error.
Dental practices often treat payment posting as an “out of sight, out of mind” activity. Payment posting occurs on the tail end of the claim process after staff have invested significant time and effort in verifying patient coverage and supporting a clean claim. It’s tedious, highly manual, and relegated to entry-level staff.
But the inefficiencies associated with manual payment posting result in more than lost productivity and higher transaction costs. When practices don’t get this piece of the payment process right, they risk errors that:
How can dental practices strengthen their cash-posting capabilities? There are three things to consider.
Eliminate paper-based payment
It takes staff significantly longer to process paper-based check payments than electronic payments, according to an Association for Finance Professionals report. Meanwhile, transaction costs associated with paper payment are five times higher than e-payments. Yet healthcare organizations have been slow to make the move to electronic payments. Just 20 percent are ready to accept payments other than checks, cash, or credit/debit cards. Among dental providers, the numbers are even lower: Just 12 percent of dental practices accept electronic claim payment, with the remainder paid by checks sent by mail, according to the
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What’s holding dental practices back? It’s not fear of consumer abrasion. While there are consumers who prefer paper-based payment and billing, more than half of consumers say they would choose electronic statements and payment for healthcare bills, a recent survey shows. Instead, slow adoption of electronic claim payment typically comes down to:
There is a business case for making the move to electronic payment, both in terms of cost savings and efficiency. On the cost side, dental practices nationally could save $119 million per year by moving to electronic claim payment alone, according to the CAQH Index. They also spend far less time processing electronic payment than check-based payment, with transaction costs that are five times lower, according to the AFP.
There’s also a reputation factor to consider. Electronic payment significantly reduces the potential for payment fraud, especially as check fraud becomes increasingly sophisticated. Last year alone, check fraud cost U.S. companies $18 billion, impacting 70 percent of organizations.
Transition to electronic remittance advice posting
The vast majority of dental practices (80 percent) rely on manual posting of remittance advice, the explanation of claim payments sent by the health plan to the provider, according to the CAQH Index. Just 17 percent of dental practices rely completely on electronic posting; 3 percent use a partially manual, partially electronic approach.
The decision to receive remittance advice electronically instead of by mail saves dental practices time and money. It also streamlines remittance advice management. By eliminating stacks of paper remittances in favor of electronic remittance posting, practices gain the following benefits, according to the American Medical Association:
For example, one practice used to spend hours organizing the data in remittance files, sorting the data by adjustment type, location, and more. Large files that included hundreds of claims could take up to a day and a half to process. Worse, as staff manually organized the data, sometimes a claim would be unintentionally skipped. When this happened, staff would need to pore through the data to pinpoint the missing claim-an effort that could take one to two hours.
The practice invested in a software solution that automates reconciliation of electronic funds transfers with remittance advice-and reduced this process to just two hours. Staff can pick and choose how remittances are split and locate remittance data with a few keystrokes.
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Ditch manual payment posting processes
When dental practices fail to invest in the right people and processes to support payment posting, they risk mistakes that make it difficult to follow up on underpayments from insurers. They also leave themselves vulnerable to a hit to their reputation, such as when staff accidentally apply payment to the wrong patient or claim, fail to account for overpayments, apply the wrong adjustments to charges, or manually enter the wrong payment amount.
Automating payment posting removes the guesswork and drudgery from this process. It provides real-time visibility into payments received from payers. It also significantly reduces the administrative costs related to these transactions.
For example, one specialty practice saved 13 hours per day by automating its cash-posting processes, increasing productivity and freeing up staff to focus on activities that provide greater value for patients. Examples of value-added services that can be added when routine tasks are automated include oral health screenings, remote dental checks, oral health education, health screenings for schools and employers, and new services such as cosmetic dentistry procedures.
What should dental practices look for in an automated payment posting solution? Key features include:
Protecting Revenue-and Your Reputation
In an era of online reviews and high overhead, dental practices can’t afford inefficient revenue processes that hurt their profit margin and threaten patient loyalty. Addressing these cash-posting challenges in a more modern way with electronic processes, automated support for staff, and increased synergy between payment receipt, posting and remittance reduces the potential for error, boosting dental practice revenue while safeguarding patient trust.