A large, multi-subspecialty ophthalmology group (Ophthalmology Group) contracted VMG Health to perform a revenue cycle management (RCM) assessment for the clinic. The primary focus was identifying improvement areas within the clinic’s billing and collections processes to optimize revenue flow and ensure compliance with industry standards. 

Situation

The Ophthalmology Group’s physician board of directors was growing more concerned about the aging of accounts receivable and declining reimbursements. They believed switching to a new practice management system and inefficient workflows decreased reimbursement for services performed. 

Solution

VMG Health conducted an RCM assessment to evaluate the clinic’s billing processes and net collections. The approach involved a comprehensive analysis of the current financial statements and benchmarking the results against proprietary industry standards. VMG Health also performed an onsite evaluation to assess physical operations, including patient data acquisition and posting claims and payments. This process included interviewing and observing staff to gain valuable insights, such as workflow clarity, technology use and familiarity, team synergy and communication, and compliance and documentation practices. VMG Health’s goal was to provide actionable recommendations that enhanced the ophthalmology clinic’s revenue cycle management practices, performance, and profitability. 

Success

The assessment identified several key areas for improving the practice’s overall billing operations: 

  • Develop standards to enhance RCM metrics, including Net Collections Ratio and Days Sales Outstanding, and ensure claims are submitted for payment within 24–⁠48 hours of the date of service. 
  • Reorganize work duties across departments and optimize staffing models. 
  • Improve insurance verification and eligibility processes, leveraging AI and digital options available in the new practice management system. 
  • Identify compliance deficiencies, such as the compliance plan, routine chart audits, and adherence to updated regulatory policies. 
  • Outline front desk operations to increase collections at the time of service. 
  • Recommend a system for monthly financial reconciliation between reports. 

By optimizing front desk operations, verifying insurance eligibility, and ensuring payment collection at the time of the patients’ visits, the Ophthalmology Group increased monthly collections by an average of $13,000. Additionally, the group prioritized submitting claims within 24 hours of the patients’ visits and implemented a policy to collect payments for advanced surgical technologies, such as premium IOLs, before surgery. These efforts reduced Days Sales Outstanding from 36 to 22, significantly improving the Ophthalmology Group’s cash flow.