Industry Insights
Five Steps to More Profitable and Efficient Laboratory Operations
May 17, 2024
Let’s face it. Laboratory billing (laboratory revenue cycle management or lab RCM) is a complicated mix of workflows, codes, payers, and practices that can lead to efficient and profitable laboratory workflow management when done with the right laboratory billing system.
We all know that running a pathology practice or clinical lab is expensive. They take on significant overhead costs for equipment, supplies, and staff (all done to serve their clients and patients) and then need to generate enough revenue to cover those costs and sustain business operations.
Proper lab billing practices enable labs to be efficient and profitable and most importantly get paid accurately and promptly for services rendered.
LigoLab Informatics Platform is an all-in-one laboratory information system (pathology lab software) and laboratory revenue cycle management solution (RCM cycle) designed to help pathology groups and clinical labs digitally transform with advanced software technology.
LigoLab’s LIS system, when teamed with its billing software for labs, brings together the modules and a shared database needed to streamline and automate processes, remove the potential for errors, and ensure accurate and prompt payment.
Proper lab billing starts with advanced laboratory software systems and the right mindset.
Here are five steps your medical lab can take to become more efficient and profitable.
Step 1: Recognize Lab RCM is NOT a Back-End Process
Laboratory revenue cycle management (lab RCM) has traditionally been a “back-end” process. Fortunately, this outdated view is changing because accurate information needed for a smooth and productive lab billing workflow can now be interwoven throughout the workflow design of advanced laboratory billing solutions.
It’s best to start lab RCM at the order level, allowing verification and scrubbing components to be shared by the lab LIS and RCM modules. Real-time patient/payer data verification seamlessly integrated into one platform prevents rejections and denials and ensures the laboratory billing process is both seamless and able to be easily edited. This live queue-facilitated lab workflow greatly increases accuracy and throughput efficiency.
Learn More: Six Reasons Why You Should Choose an Integrated Laboratory Billing Solution for Your Medical Lab
Step 2: Integrate Data to a SINGLE Source Informatics Platform
Nationwide, an estimated 35 percent of denials are caused by inaccurate or missing data primarily due to the human error component and time-consuming nature of manual claim processing.
Standalone RCM systems substantially contribute to high denial rates and revenue loss. When LIS & RCM modules operate as separate silos, even if interfaced, the full capabilities of each cannot be achieved due to lack of consistency, transparency, and integrity of data.
A single fully integrated platform shares a common database and software infrastructure thereby ensuring proper interchange of laboratory data, greatly improving lab workflow integrity, accuracy, and processing.
Learn More: Leveraging LIS & RCM Integration to Improve the Laboratory Billing Process
Step 3: Implement Rule-Based Automation
Manual processes often lead to user error and missing or inaccurate data. Furthermore, cumbersome and complex CPT and ICD coding typically bring on subsequent error-prone entries. Collectively, this greatly increases inaccuracies that lead to rejections and denials.
Laboratory billing solutions with rule-based automation ensure verified demographics, accurate CPT/ICD coding, proper TC/PC and other modifiers for assignment and splitting, and regulatory institution compliance (PTP, MUE, LCD, NCD ). This provides a transparent and customizable lab workflow and statement generation and facilitates accurate data integration throughout the pathology lab management workflow.
Learn More: Automation in Pathology Labs Using Advanced LIS System Software
Step 4: Maintain Constant Full Visibility of Your Lab RCM Operations & Finances
Even when revenue and net collections are robust, the industry is constantly in flux so one must be fully aware (at the touch of a button) of high and low-margin procedures, operational gaps, and department efficiencies (or lack thereof).
The goal should be to increase your lab’s clean claim pass-through rate. In that case, you should look for a robust laboratory billing system that tracks all data and lab operations and can create customizable reports and dashboard templates that can easily be used to measure efficiency and workflows.
Learn More: The Top Five KPIs: Driving Successful Lab Revenue Cycle Management
Step 5: Remain Agile and Able to Pivot Given Unforeseen Industry Changes
Too often, laboratories become set in their ways when the niche focus is on profitability instead of investment in infrastructure improvements. This gets overlooked because it’s deemed “unneeded” for the lab’s current operations processing. This is primarily due to investment and current return on that investment, and the high cost of traditional, siloed, hard infrastructure improvements.
Forward-thinking labs can counter this potential stalemate when the tides change by investing in a pliable, customizable, and ever-expanding pathology lab software platform. It’s a smart choice that will pay huge dividends down the road.
Look for pathology software that has no huge cost of entry and one that’s based on a true partnership model with no added future costs. One with a sharing of costs and a tailored metrics model.
With this model, you’re never hit down the road with unforeseen costs, and you have a future-proof operation at the onset, anchored by an enterprise-level LIS & RCM software platform ready to pivot and expand at any time in any landscape.
Learn More: Navigating the Future of Pathology: The LigoLab Advantage
To learn more about how LigoLab’s laboratory billing solutions can increase your clean claim pass-through rate and improve your overall laboratory workflow operations through advanced, highly customizable automation, connect with a LigoLab Lab RCM Specialist.
