First Pass Resolution Rate: Get Paid the First Time
In the world of RCM, there are a number of Key Performance Indicators that a well-performing practice should pay attention to. Ignoring one of these key metrics and the picture they paint on the health of your practice could mean a significant loss in revenue. Many practices recognize the importance of days in A/R, but your First Pass Resolution Rate is equally as important - if not more so.
For our first installment of the RCM 2.0 Deep Dive Miniseries, we are taking a closer look at the First Pass Resolution Rate. See how our RCM expert, Jessica Cousins, breaks down FPRR and decodes how this critical metric impacts your revenue cycle and can signal you to where your frontend and backend inefficiencies lie.
Thank you so much for checking out our RCM 2.0 video series. The purpose of this video series is to cover a range of RCM topics typically overlooked or misunderstood during the revcycle. We really want to get a deep dive into so you can use the insight to apply it to your practice and make sure you are realizing your true potential.
Today we are going to focus on First Pass Resolution Rate or FPRR. We are going to define what First Pass Resolution Rate is and more importantly what it is not. From there we are going to think of the critical success factors of FPRR and why it is important. We are also going to round it out by showing you how to apply your FPRR benchmark into your overall business analysis so you can make sure you are maximizing your potential in the office.
What is FPRR?
Your FPRR is your percentage of claims paid the first time they are submitted to the insurance company. That is paid in full. To calculate the total number of claims paid divided by the total number of claims submitted.
For most practices, it will vary by specialty in terms of what the FPRR should be for your practice. No matter what, you never want to see below a 94% FPRR. Regardless of payer mix and regardless of your specialty.
FPRR is not the same as your Clean Claims Pass Rate. For many years a lot of systems and companies you could work with would confuse the two. The Clean Claim Rate is the percentage of claims that pass through the clearinghouse and actually make it to the payer. It does not even consider if those claims are being paid.
Your FPRR is taking it a step further and saying that not only did it make it to the payer but did it also get paid in full? With the technology that is in place in practice management systems today, there is no reason why your clean claims pass rate shouldn’t be upwards to 100%. Your FPRR is a little bit trickier. There is a lot of different things that have to go into those claims making sure they are clean, processed and paid in full.
Why is your FPRR Critical?
Your FPRR is a total reflection of the effectiveness of your RCM processes. How effective is your process? Particularly on the front end, meaning everything that happens before that claim goes out the door.
Including all your front desk operations:
- Your enrollment with the payers, are your providers credentialled with those payers?
- Are you checking eligibility for every patient that walks in through the door?
- Are you obtaining your prior authorizations before every procedure being performed in the office?
- Do you have checks and balances in place to make sure that patient demographics are being entered completely and accurately?
Also look at the second step of that front end RCM process, your billing and your coding. Are your providers coding correctly? Do you have billers in place to affectively add modifiers and code properly?
All these front end processes affect your front end resolution rate which affects your efficiency and profitability.
How to use FPRR to see an improved collection.
If you have an unhealthy FPR the goal is to understand why. Are you missing any of the key points? Eligibility, enrolment, etc? If your FPRR is on the low side we need to understand if you are looking at all the front end processes, and both billing and codding.
You have a staff in place doing that for you. The goal is that with a high healthy FPRR, you never have to worry that your staff has to touch that claim again. The goal is that when the claim goes out the door the insurance company pays it in full and your staff moves on to new claims. Every time your staff has to go and work old claims it is costing your time and money, burning through your resources. Your staff and your time are the best resources that you have in your practice to maximize your money.
What does an unhealthy FPRR mean for your practice?
The FPRR is a feeder metric into so many of your other metrics. If your FPRR is low what does it mean to your other metrics? Your denial rates are high, elevated days in A/R, looking at lower net collection rate, higher A.R from 60 days out and hitting a higher A/R 120. Also slows down you staff because there is now more work in place.
As we look at your overall FPRR you want to make sure that you are looking at the correct metrics. If you are using a practice management system that provides the metric for you. Ask them questions to make sure that you are looking at your FPRR or if you are looking at a Clean Claim Rate. If you see your rate is 97 or 98 percent that’s wonderful, but make sure you know how that is being calculated.
Bottom line is that every time a claim goes through the door and you receive a denial in the back end, you are burning through your resources. Make sure you have the process in place on the front end to alleviate that so it doesn’t happen.