Are you looking for automated ASC-606 certified accrual-based, encounter-level revenue recognition? How long are your current close processes today from start to board reporting revenue? In this article we'll explore the realities of the elusive, mythical 3-day financial close and opportunities for improving closing speed.
In the summer of 2020, a $500 million MSO was facing challenges to close their financial books in under 60 days. Insurance Explanation of Benefits (aka. EOB) line-item detail reconciliation with charges and diagnosis required significant process changes as well as a solution designed to process rapidly expanding data volumes. On average, this MSO required the processing of 15 million records per month-end with 9% growth, month over month.
While these data volumes are nothing compared to 'big data', they are way too much for Excel spreadsheets or most open-source database options, especially considering the PHI & HIPPA nature of MSO related information.
Needless to say, the required solution is complicated - at least more complicated than the Patient Management Systems (aka. PMS) could handle. Each location ran a different software or significantly different versions (on-premise or cloud). Native reporting tools were not capable, nor designed to support the reconciliation work-load necessary to crunch revenue accruals.
Now consider the marrying of multiple locations and aggregating transactional details with the same AMA or Service Codes. Piece of cake right? Reality is no, it is not a piece of cake but a well-designed solution can help any organization have similar results as this MSO realized.
They are now able to bring revenue insights with encounter-level detail, aggregated across an MSO organizations, at cloud-scale in 2 hours (including validation). The Azure technology stack delivers operational analytics, encounter-level revenue recognition, and MSO consolidated financials, through Power BI.
After implementation, they realized an 80% reduction in close duration and 92% reduction in FP&A resources for month-end processing.
Are you searching for an ASC-606 compliant solution? Do you have multiple locations and face similar challenges aggregating more than summary-level general ledgers? The process to achieve these insights can be complex and require attention to many aspects of the processing of claims data and EOB reconciliation over long spans of time.
Contact us today to share your situation and let's talk revenue recognition and what's preventing your team from achieving a quicker close and ASC-606 compliant revenue recognition.