#182 How Multi-Location Practices Lose Revenue Between Sites, Part 1

You opened a second location because the first one was working. What no one told you: the moment you added that second site, you added a second set of revenue gaps. And most of them are invisible on a consolidated report.

In Part 1, we cover the two most expensive gaps inside multi-location practices doing over $300,000 a month. Neither generates a single denial. They just show up as missing revenue no one can explain.

System 1 — The Credentialing Gap:
A provider sees patients at a new site before credentialing is finalized. The claims go out. The payer rejects them, or pays provisionally and recoups months later. One provider, 60 uncredentialed days, 15 patients per day at $180 per visit: $162,000 in claims at risk. The front desk who scheduled those patients had no idea.

System 2 — The Shared Billing Problem:
One billing team covers both locations. Denials get triaged by volume, not by site. The smaller location falls behind. Its AR days climb past 40, then 50. Six months of recoverable claims cross the timely filing window. A secondary site at $90,000/month with a 12% denial rate instead of the target 5% loses $6,300/month in unworked denials. Over a year: $75,600. That is the gap the report will not show you on a consolidated view.

Three actions this week:

• Build your credentialing matrix (one row per provider, one column per location, effective dates visible) 
• Pull a site-specific AR report — not consolidated, by site 
• Set a site-level denial threshold and define what triggers an immediate review meeting 

Episode breakdown:

00:00 The revenue gap no consolidated report will show you
02:00 Why multi-location growth is a systems problem
04:30 System 1: The Credentialing Gap
09:00 The $162,000 scenario
12:00 Who owns the credentialing matrix
14:30 System 2: The Shared Billing Problem
18:00 The $75,600/year site-level loss
21:00 Who owns the site-specific AR report
23:30 Three actions this week
27:00 Free resource + Part 2 preview

Credentialing Scenario Reference:
1 provider | 60 days | 15 pts/day | $180/visit = $162,000 at risk
2 providers | 30 days | 12 pts/day | $200/visit = $144,000 at risk
1 provider | 90 days | 10 pts/day | $150/visit = $135,000 at risk

Resources Mentioned:

Payment Posting Audit Checklist (free):
eligibility.natrevmd.com/payment-posting-checklist

Practice Revenue Leak Scorecard (free):
eligibility.natrevmd.com/nrm-revenue-scorecard-v3

Book a free 30-minute audit call:
calendly.com/heather-natrevmd

RECOVER Diagnostic Quiz:
natrevmd.com/quiz 

Transcript

SPEAKER_00 0:04

Most multi-location practices are losing six figures a year from gaps that never generate a single denial, never generate a single patient complaint, and never appear on a consolidated financial statement. They just show up as missing revenue that no one can explain. Welcome to Nat RevMD, a podcast where we share tips on optimizing medical billing and improving practice efficiency so you can have the business of your dreams. I'm your host, Dr. Heather Signarelli, founder of Nat RevMD. Let's get started. Today we're talking about the two most expensive of these gaps. Both of these are active right now in practices, doing over $300,000 a month. And by the end of this episode, you will know exactly where to look, what each one is costing you, and the first systems to put in place this week. Not just when you add a third location, but actually this week. Multi-location growth is something that we have experience with. We have multiple facilities that have multiple locations. And as we have really understood the differences between a single site and those with multiple locations, we are going to walk through some of the growth challenges that are not necessarily billing problems, but system problems that show up in your billing. And so when your operational structure does not scale with your footprint, the revenue cycle really does absorb the damage over time. And so practices that catch it early are the ones tracking the right things at the right site levels. These are the ones that we are tracking within our own multi-location sites. But what we are seeing is that most of these were not tracking and trending this before they came over to us. And so we want to talk about where that bleeding can occur. All right. So the first system is the credentialing gap. So this credentialing gap is exactly what it sounds like, right? Provider who is credentialed at location A begins seeing patients at location B before their credentialing at that site is complete. And then the visit happens, the claim goes out, and the payer rejects it. Or worse, uh, it pays provisionally and then recoupes it months later, which is even more annoying. And so here's what it looks like for practice. You open a second location in March, your highest volume nurse practitioner wants to start seeing patients over there, right? And so they're moving over there in April because their schedule is because the schedule is full, demand is real, and credentialing at the new site isn't finalized until June. So basically every claim that the nurse practitioner generated between April and June at location B is now risk. Again, you can have those two scenarios where they're denying it up front or alternatively where they're recouping the money later. And obviously, I know that there's a lot of incident two billing that goes on. You just really want to make sure if you've set that up at the second location, say the physician is credentialed that you're following incident two guidelines and they are very, very, very strict about incident two guidelines, depending on the payer. And you really just don't want to be in a situation where they audit you and then recoup that money. We have seen practices lose six figures related to inappropriate incident two guidelines. So obviously, depending on the payer, credentialing can take 30, 60, 90 days, even if you were already credentialed for other physicians at that location. So start early. If you know a site's opening, add that address. Another key thing here is if you're moving, we really see better success with adding an address and then removing the old one later versus removing the old one from the get-go. So just a tip that we've seen our credentialers use. The cost most practices never actually calculate is that, you know, physician or provider seeing 15 patients a day and an average reimbursement, you know, of $180. So that's, you know, $2,700 a day, 60 days of uncredentialed billing at that volume is going to be $162,000 in claims that can be denied, recouped, or may need to be written off entirely. And so really want to make sure that you have your credentialing uh chart all structured and that the front desks knows where those people patients can be scheduled for specific providers at specific locations. So obviously, who owns this, right? So you want to make sure that your credentialing team has a very site-specific credentialing matrix and that they understand when you plan to open, when those physicians or providers plan to see physicians uh patients at those locations. And there's a really simple way to manage this with a matrix where you actually show the providers, you show the locations, the effective date. And we even like to color code. You guys know I love a color code, um, so that you can see red, yellow, green for every combination. And obviously, if you don't have a dedicated credentialing coordinator or whoever is managing this, maybe you have an outsourced provider, you just want to make sure that then they're creating that matrix. Obviously, you really don't want to have patients seen by a provider, mid-level physician otherwise, without really having that green status uh checked off. All right, so system number two, the shared billing problem. We have gone into multi-location practices and we've seen where a billing team is covering those multiple locations, but the the denials are actually getting triggered by volume or by a dollar figure and not actually by site. And so the team is working the claims that are easiest to recover first, or maybe highest dollar to lowest dollar, or the newest denials. But those smaller locations or smaller dollar claims at a small location may get pushed down to the bottom. And so what you end up having is a really successful location and maybe a smaller location that has worse billing metrics. So they have more denials, they have more unworked denials because your billing team is lumping them all into one bucket and then working those and then maybe not getting to those lowest denials. And really where this hurts you, especially if you're paying your physicians or providers by commission, is they may not want to work at the smaller location. They only want to work at the larger location because on average the revenue per day or revenue per per patient visit is higher there, not because you're necessarily seeing more patients at one location or the other, but because the billing efficiency is better at the larger location than the small. So here's what that looks like. A location A is doing $280,000 a month, location B is maybe doing $90 or $100,000. And your billing team has one big denial queue. And they're not wrong to prioritize, you know, the highest dollar to the lowest dollar. But because location, because the larger location, the denials are higher value, they're working those. But then the smaller location, location B, those denials age out, and then your AR days is then starting to rise. And oftentimes this gets harder to see when you're looking at metrics across a large multi-site location company, and you don't notice that you have the smaller site really struggling from a billing metric perspective because you're not looking at it. So for us, we are pulling those site-specific AR metrics so that we're looking and understanding and making sure that the AR is managed even at the smaller sites, just as much as it is on the on the larger sites. So, really, really important. So the cost to practices that obviously most people are not even calculating is that secondary site, you know, the $90,000 a month site, um, may have a denial rate of 12% instead of that target of, you know, less than 5%. And they could be losing over $6,000 a month in unworked denials. And so over a year, that is, you know, close to $75,000. And so obviously that can get uh underappreciated when you look at metrics across a large company. So really, really important to have this done with your billing team. Obviously, who owns this is your billing manager. And so they're the ones who are making sure that site-specific AR reports are run and that the team is focusing on those, regardless of a highest dollar to lowest dollar, that all of those claims are getting managed and that location A or location B have uh similar type of metrics in terms of denials and claim follow-up. So, really, really important to measure and monitor this. All right, so obviously today we're talking about credentialing and site level billing accountability. And when those things are unmanaged, you can see multi-location practices losing six figures annually from those gaps that never really generate a patient complaint. You may not even see them in a larger consolidated financial statement or roll-up metrics from a billing perspective. And obviously, it is the cost of scale without having this structure. So, important things to take away for actions this week is we want you to make sure that you have a credentialing matrix so that you're listing those providers every single location, marking the credentialing status and effective date for each of these, making sure those addresses are correct. And obviously, that your credentialing team who owns this document is updating this and making sure that when there's a new site that's coming live, that you have a plan of action around getting those individuals credentialed, every single one who's going to be seeing patients there ahead of time before you start seeing patients. And if you're moving a provider to a new location, you just want to make sure that credentialing is done ahead of time. All right. So second thing is making sure that your billing team is pulling site-specific AR reports and making sure that they are looking at AR by location. Obviously, they're already looking at this overall, hopefully, and by payer, but you want to make sure that you're looking at those denial rates and AR notes separately for each site so that you're working through the kinks or the issues that may be coming up for those locations. Um, so if your billing software does not produce these reports cleanly, that can be an issue, which is why while we work with many different EMRs and PM softwares, we do have our favorites because it does make things easier. Like we love ECW, we love uh ModMed, Advanced MD. Those are some of our favorites. Granted, we work with many different ones. So you just want to make sure that when you have multiple locations, you have the right process in place in order to manage these locations as you scale. And then last, you just want to make sure that you have site-level denial thresholds. So you want to make sure that those uh denials and AR reports are managed by your billing team and that those triggers result in immediate review or escalation within your billing team, not just this high-level view at the end of the month. So again, this is something your billing team should be doing already. Just want to remind you guys that this is really, really, really key. So if you are running multiple site locations and you've never seen a site specific AR report or you're worried that your team isn't doing these, head on over and check out our payment posting audit checklist. It is a great framework that we even use with our practices, both new and old. And it's a good place for you to see where those gaps are. You can check out the show notes below or eligibility.netrevmd.com backslash payment dash posting dash checklist. That is a mouthful. So get the link down in the show notes. Obviously, free. And of course, if you are interested in chatting with us about billing services, you can head on over to natrevmd.com and check out um our free metric link or set up a Calendly link with the show notes below. All right, so thanks so much for being part of part one. So this is part one of two-part episode. So this week we talked about those two most invisible revenue gaps, how to close them. And then next week in part two, we're actually going to go deeper into the structural layer underneath these problems. Obviously, uh credentialing gaps and billing blind spots do not happen in isolation. And they happen a lot of times because of front-end data coming out of your second location is inconsistent with your first. And so we're going to be talking about these things uh next week. So subscribe so you don't miss out, and we'll talk to you then. Thanks so much.