Complete guide to Australian hospital revenue cycle management — MBS billing, private health insurance claiming, DVA billing, IFC, gap payments (Access Gap Cover), denial management, and revenue cycle software.
Australian hospital revenue cycle involves MBS + private health insurance + DVA. Access Gap Cover reduces patient gap payments. AR-DRGs drive casemix funding. This guide covers Australian revenue cycle management.
Revenue Cycle Stages
- Pre-registration: Patient demographics, Medicare, health fund, DVA details
- Registration: Patient registration, eligibility verification
- Pre-auth: Pre-authorisation for procedures requiring health fund approval
- Service delivery: Provide medical service with documentation
- Coding: ICD-10-AM diagnoses, ACHI procedures, AR-DRG assignment
- Claim submission: MBS (medical), health fund (hospital), DVA (veterans)
- Payment: Medicare 75% + fund 25% (medical), fund per diem (hospital)
- Gap billing: Patient gap or Access Gap Cover
- Denial management: Appeal denied claims
- Reconciliation: Reconcile payments with claims
Revenue Cycle KPIs
| KPI | Australian Average | Best Practice |
|---|---|---|
| Days in AR | 45-55 days | < 35 days |
| Claim denial rate | 8-12% | < 5% |
| Clean claim rate | 75-85% | > 95% |
| Collection rate | 90-95% | > 98% |
| AGC participation | 85% | > 90% |
| Cost to collect | 3-5% | < 2% |
| Write-off rate | 3-5% | < 2% |
Denial Management
- Denial tracking: Track all denials by reason, fund, department
- Root cause analysis: Identify and fix root causes
- Appeals: Appeal denied claims within fund time limits
- Prevention: Fix root causes to prevent future denials
- Eligibility verification: Verify Medicare, health fund, DVA at every visit
- Pre-auth compliance: Ensure pre-auth before non-emergency procedures
- Coding accuracy: Ensure accurate ICD-10-AM and ACHI coding
Frequently Asked Questions
- What is the Australian hospital revenue cycle?
- Australian hospital revenue cycle: 1) Patient registration (Medicare, health fund, DVA details), 2. Service delivery, 3. Coding (ICD-10-AM, ACHI), 4. Claim submission (MBS for medical, health fund for hospital), 5. Payment (Medicare 75% + fund 25% for medical, fund per diem for hospital), 6. Gap billing (patient or Access Gap Cover), 7. Reconciliation, 8. Denial management, 9. Reporting.
- What is Access Gap Cover?
- Access Gap Cover (AGC) is a scheme offered by Australian private health insurers to eliminate or reduce patient gap payments. Doctors who participate in AGC agree to the insurer's fee schedule. In return: 1) Insurer pays a higher benefit, 2. Patient has no gap or a known capped gap, 3. Doctor gets paid faster. ~85% of specialists participate in AGC.
- What is the Australian DRG system?
- Australian DRG (Diagnosis Related Group) system is called AR-DRG (Australian Refined DRG). AR-DRGs classify hospital admissions by diagnosis and procedure for funding and benchmarking. Public hospitals are funded by state governments using AR-DRG-based casemix funding. Private health insurance uses AR-DRGs for benchmarking. Each AR-DRG has a weight that determines funding relative to other DRGs.