June 28, 2024

5 Reasons to Skip a Zero-Balance Review in Healthcare Revenue Cycle Management

Brandon Pittman
VP of Business Development
at Boost Healthcare
Zero Balance

Healthcare CFOs are advocating for a return to basics as Kaufman Hall’s April 2024 “National Hospital Flash Report” reveals 40% of hospitals still operate with negative margins.  This renewed focus on revenue cycle fundamentals may include reprioritizing a Zero-Balance Review.

At first glance, re-examining accounts with no anticipated additional reimbursement may seem counterintuitive.

After all, is it really worth re-reviewing accounts with no additional reimbursement expected?

It may not be, read on to decide for yourself.

What Is a Zero-Balance Review?

A Zero-Balance Review retrospectively scrutinizes accounts showing no outstanding insurance balance.  This process verifies whether full and appropriate reimbursement was received from the payer(s) for the services rendered.

Acting as the safety-net to healthcare providers’ revenue cycle processes, both internal and outsourced, a zero-balance review identifies and recovers lost revenue from contracted and non-contracted Commercial and Government payers.

What Are The Benefits of a Zero-Balance Review?

When an unbiased partner conducts a zero-balance review, the benefits can be:

  • Increase net revenue by recovering unknown underpayments and unworked denials.
  • Improve payer compliance by generating data-supported insights into payer behavior with a comprehensive analysis.
  • Optimize revenue cycle processes with newfound upstream process improvements.
  • Prevent underpayments with identified root causes that are creating an environment for revenue leakage.
  • Improve margins by recovering otherwise lost revenue, implementing process improvements, and negotiating more favorable contract terms with payers.

Why Not Do a Zero-Balance Review?

Although Zero-Balance Reviews are often considered a best practice in healthcare revenue cycle management, there are situations where they may not make sense.

Here are 5 reasons why a hospital might decide against a Zero-Balance Review:

Resource Constraints

While the implementation process can be expedited when working with a partner dedicated to Zero-Balance Reviews, it does require claims data, system access, and payer agreements to operationalize.

Staff Perception

Between some staff having overconfidence in established revenue cycle processes or becoming territorial when considering a Zero-Balance Review, internal resistance can become a hurdle.

Payer Relationships

While most payer agreements allow for limited retrospective reviews, some payers may become frustrated with an extensive review of zero-balance accounts.

Competing Priorities

With most healthcare revenue cycle leaders prioritizing ‘open’ or ‘active’ accounts receivable, this may leave little bandwidth for implementing an internal or outsourced  Zero-Balance Review.

Uncertain Return on Investment

Like each hospital, each Zero-Balance Review is unique, making results impossible to guarantee.  While historical performance suggests that up to 1% of reviewed net revenue is being lost to underpayments and denials, actual recoveries can vary.

Wondering if a Zero-Balance Review could work with your organization? 

Speak with our dedicated experts that prioritize zero-balance accounts daily.

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