Revenue cycle benchmarking instrumental to successful finance performance
Revenue cycle performance improvement remains a major priority for hospital finance departments; yet, they lack comparable benchmarks in collections, costs, and denials.
To fill this gap, the Council in 2005 launched a revenue cycle benchmarking initiative, followed by two more comprehensive surveys in 2006 and 2008. The 2011 survey continues our earlier work and provides comparative benchmarks for a range of revenue cycle areas, including AR days, first-pass yield, bad debt, charity care, cost to collect, and denials management.
AR improvements, but POS collections still a trouble spot
Among the takeaways from this latest survey, we found that since 2008, hospitals have shown strong improvement in AR days across all performance categories. Average and bottom quartile programs, however, still have ample room to improve.
Point-of-service collections, meanwhile, remain a struggle for many hospitals across the country, with the high-performing quartile just exceeding 1% of net patient revenue through up-front patient collections.
We also found that, overall, hospitals collect 94% of their total net patient revenue in cash. Unsurprisingly, self-pay suffers from the largest shortfalls. Recovery rates for Medicare and Medicaid were 92% and 94%, respectively, largely mirroring our 2008 survey results. The relatively low collections from government payers and self-pay patients were balanced by significantly higher rates from private payers.
Access the full study to learn more
The 2011 Revenue Cycle Benchmarking Results allow finance executives to measure performance against industrywide metrics on a wide variety of revenue cycle benchmarks. Our survey measured not only the commonly tracked patient access and business office departments, but also the less frequently included metrics across the mid-cycle.