“Look, if I made more than $165.00 on this claim, I’m not looking to chase the rest.”
When it comes to balancing encounters and closing out A/R, Athelas starts by automatically resolving any denial adjustments that we’ve confirmed are not realistically workable. This strategy works well for many common adjustments, however as we get into the long-tail of thousands of individual adjustment combinations, this approach starts to become less effective.
This is why we’re implementing a new complimentary strategy, the Target Allowed Amount.
What is a Target Allowed Amount?
A Target Allowed Amount (TAA) is our answer to the question:
How much do I realistically expect to earn for this claim?
With TAAs, Athelas is able to quickly identify encounters where we’re satisfied with the payouts, then write off the balance and finalize the encounter. This allows us to resolve a large number of encounters where no further action is needed, reducing unnecessary inflation of a practice’s A/R metrics.
How is a TAA different from a Contracted Rate?
While these concepts are similar, a Contracted Rate is the letter of the law for how much a payer is supposed to pay for a procedure. But in practice, a variety of factors cause them to pay less. TAA on the other hand is more practical: it’s the amount you designate as the minimum your practice will accept for a claim configuration and not pursue further payment. If the payer exceeds that amount, even better.
Contracted Rate and TAA amounts are often nearly the same, but TAA tends to be slightly lower.
How do TAAs work?
- Athelas provides an internal tool to its Operations Team that lists a practices most common claim configurations, which are a unique combination of procedures (cpt/mod/units), payer, and place of service.
- The Ops team can review all the allowed amounts we’ve received for this particular claim configuration, discuss with your practice, and together specify an acceptable TAA.
- When the Adjustment Rules Engine System (ARES) finds an encounter that matches the claim configuration and has an allowed amount greater than the specified TAA, all remaining non-PR balances will be written off, resolving the encounter.
Are we required to use TAAs?
Definitely not! Target Allowed Amounts are an optional tool meant to give you greater accuracy in your A/R metrics, help your team focus on working the most important claims, and get PR to your patients sooner.
Athelas strongly recommends using TAAs, but in the end the choice is yours.
If you and your practice would like to start setting Target Allowed Amounts to get a clearer picture of your A/R and resolve more encounters, talk to your Account Manager and we’ll get a TAA session set up.
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