American Addiction Centers – the largest network of rehab facilities nationwide – was faced with a common but costly problem: establishing and maintaining an internal revenue cycle team capable of increasing revenues in the midst of a nationwide shortage of highly skilled professionals. High turnover rates made it a challenge to build any in-depth institutional knowledge about the organization’s revenue cycle processes, while exorbitant salary demands far exceeded the experience new employees were bringing to the table.
Meanwhile, quality and efficiency at American Addiction Center’s stand-alone revenue cycle management (RCM) department was suffering. Collections had dipped to 50%, while time-to-bill and cash postings slowed significantly. Capturing documentation sufficient for monitoring key performance metrics was also a challenge. These realities, coupled with the results of a cost-benefit analysis, ultimately led the organization – which has programs in California, Florida, Texas, Nevada, Massachusetts, Mississippi, New Jersey, and Rhode Island – to the decision to outsource its RCM.
“Our revenue cycle team was not the caliber of team that was needed to perform the functions to increase revenue at American Addiction Centers, so the decision was made to outsource the services for RCM and we immediately thought of AGS Health. They were the only partner I thought to bring in, I know them. I feel comfortable with them. I know that what I'm getting is good value, but also that I’m getting superior quality and a commitment to me as a customer and that makes a lot of difference to me.”
AGS Health’s flexible service model and deep bench of highly skilled RCM professionals allowed the organization to quickly address the key issues impacting American Addiction Center’s revenue cycle. Its first act was to bring in highly qualified, motivated RCM professionals who could perform revenue cycle functions at the rate and quality needed to increase revenues. This included a commitment to time management and responsiveness, which was imperative to increasing collections and accelerating the customer’s revenue cycle.
Hummel notes that when she arrived at American Addiction Centers, there were year-old claims that were unpaid and waiting for follow up. There was also a lack of communication between RCM managers and the team tasked with day-to-day activities of managing the revenue cycle, who were “told only as much as they needed to know.”
With AGS, claims are followed up on within one week of posting and typically resolved within 30 days. Further, if there is an issue with a payer, Hummel says she simply requests a follow up and AGS is back with a response within 48 hours. Errors are immediately addressed, and processes have been implemented that allow American Addiction Center to aggregate the documentation and data necessary to monitor quality and performance metrics.
As a result, American Addiction Centers has seen its collections increase from 50% to 85%. Cash postings have accelerated from five days to three days and billing turnaround times by two days, both of which have helped improve cash flow and increase revenues.
“AGS Health’s follow up capabilities are superior to any group I’ve worked with – and I've worked with several the larger alpha providers,” said Hummel. “Their commitment to time management and the time management skills of the team that works with us are also amazing.”
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