A U.S.-based medical devices company serving the physical rehabilitation market was dissatisfied with its revenue cycle management performance. Claims had to be recoded and resubmitted to health insurers far too frequently, resulting in a high percentage of pended claims. It also had a high unapplied cash rate because of inefficiencies in matching payments to claims submitted. With a low net-collection rate and unapplied cash, the company had less day-to-day financial flexibility and missed out investor revenue targets. The company partnered with Cognizant to leverage our combined healthcare operations experience and clinical expertise in life sciences.
The company wanted Cognizant's life sciences technology experts to work on its revenue cycle management process. As one of our first steps, we established a dedicated payer team to review the company’s payer contracts, rules and payment histories using analytics. The team uncovered where underpayments and no payments were occurring and in what volumes, guiding the new collections team in prioritizing efforts to drive better collections. A workflow tool was also designed and deployed to manage the collection inventory.
We helped reduce the order-to-cash time and improve the days sales outstanding by compressing the processes across front, middle and back offices. Streamlining tasks such as managing patient eligibility, verifying coverage and calculating the percentage of payment due from insurers helped predict working capital more accurately. Up-to-date insurer contracts, as well as claims submitted according to individual payer requirements for coding, modifiers and other parameters, helped the company achieve better first-time collection results.
We helped the company eliminate bad debts and increase its revenue by $11.3 million. Automating the cash posting processes helped improve working capital and reduce unposted collections from $2 million to $46,000. The focused partnership also helped boost the company's collection ratios across its key sales lines.
increase in net revenue in one year
drop in unposted collections
rise in cash posting automation
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