Billing benchmarks

Key indicators of value to any medical practice include the net collection rate, days in accounts receivable, charge lag days, denial rates, collection per RVU, bad debt etc. A standard report generated by most software billing programs should consist of total charges, dollar amount submitted for payment, amounts paid/adjusted/written off with a breakdown by physician, facility, CPT code, and payer. An aging report with accounts receivables at 30, 60, and 120 days and beyond is essential. Overhead costs should be reviewed on at least a quarterly basis keeping in mind that overzealously trying to reduce overhead could produce negative results. Investing a little extra to obtain better information or that extra call to an third party payer may be worth a great deal more than saving a few staffing dollars. If your practice lags behind standard benchmarks, the billing manager must be able to come up with a performance improvement plan. Some warnings signs for you to look for include: claims payment first pass rate <85%, paper remittances are >30% of all posted charges, charge master has not been updated in more than 2 years, a compliance plan that has not been reviewed or updated in 2 years, insurance contracts have not been reviewed in 12 months, cash collections are lower than the previous year, 40% or more of the A/R is >90 days old and >80% of that is either self-pay or patient co pay 
Comment: Most of you are familiar with the intricacies of billing but few understand the benchmarks that you should compare your office performance with. I have laid these out here "Revenue Cycle" . and here "The Smarter Physician Volume 2"