A Cleveland Clinic lesson: Credit refund automation cuts costs and errors

Automating the credit refund process increases efficiency, reduces errors and improves patient satisfaction, according to Suzanne Tschetter, director of patient financial services for the Cleveland Clinic Health System.

Speaking at the Healthcare Finance Management Association’s ANI: Healthcare Finance Conference in Orlando, Fla., Tschetter explained how the Cleveland Clinic worked with CDR Associates, a subsidiary of ACS Xerox,to automate its refund process. Using a manual refund process for small credit balances, she said, no longer made financial sense.

“Our average credit balance refund is $75, and the cost to manually produce a refund check is well beyond that,” she noted.

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According to Tschetter, the automation software uses scoring algorithms to identify overpayments or misposted allowances and move patient payment information from one system to another to send a refund check, significantly decreasing the amount of staff time and paperwork required. Refund balances of more than $500 are still managed manually, she said.

The risks involved with not effectively managing credit balance refunds include federal penalties, revenue cycle issues, misstated profits, patient dissatisfaction and possible exposure to fraud, according to Tschetter.

The Cleveland Clinic approached the need to resolve credit balances with a focus on patients, as well as their bottom line, Tschetter said.

“If it’s my mother who is owed a $25 refund, I want her to get it as quickly as possible,” she said.