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P006 Office of Facilities Management (FY17-FY19 Strategic Plan)

P006: Percent of eligible third-party revenue collected at all agency facilities

Current Value


FY 2017


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Story Behind the Curve

  • The Affordable Care Act has increased the number of insured nationally. This puts more emphasis on third-party billing and collections.
  • Collection of revenue is important to maintain services across the state. Greater revenue collection allows the New Mexico Department of Health (NMDOH) to provide an enhanced level of care to our consumers.
  • This performance measure is based on the rate of collection for medical services with a billable pay source. The third-party collection rate for FY17 was 92.0%.
  • Although we met the target, staffing challenges remain across NMDOH, which limit our capacity to collect revenue timely and efficiently at each facility. Rejections of claims occur due primarily to changes in coding rules and regulations. An inability to recruit and/or retain highly skilled medical billing staff also contribute to the increase in claims rejected. Uncollectible write-off remains high across the facilities.
  • Facilities continue to focus on revenue collection through weekly meetings with billing agents and with third-party payers. These meetings are facilitated by senior staff at the facilities and the NMDOH Administrative Services Division to ensure timely collection of billable claims. Recruitment and retention remains a priority for revenue-generating positions, including medical coding and billing staff.


  • NMDOH facility and community program financial managers and billing/collection staff
  • Managed care organizations (MCO) under Centennial Care
  • Commercial insurance providers
  • NMDOH Human Resources Bureau
  • Veterans Administration
  • NM Human Services Department (HSD)

What Works

  • Communicating regularly with third-party payers to resolve claims issues and outstanding payments. 
  • Sharing best practices and frequent collaboration among the facilities.
  • Dedicated staff focused on outstanding claims, questioning discrepancies, and following up on payments consistently and timely.
  • Monthly reconciliation of revenue to identify unpaid claims and address issues preventing payment.


  • Communicate at least monthly, and in some cases weekly, with MCOs and third-party payers on unresolved claims.
  • Work with HSD to address payment issues that arise with MCOs.
  • Assess personnel resources for maximum efficiency in medical coding, billing, and revenue collection efforts.
  • Mandatory reconciliation of revenue monthly for consistent monitoring of earned income and revenue collection.

Action Plan

  • FY17: Recognize revenue on a monthly basis following the new policy “Recording Patient Revenue and Accounts Receivable”. Completed. 
  • FY17: Review monthly revenue actual and projected collections reports (include facility projections) for collection rate efficiency along with discussions regarding resolutions when rates fall below the target. Completed.
  • FY17-Q4: Careful review and appropriate collection efforts of aging medical claims prior to writing off revenue. Completed.

FY17 Annual Progress Summary

  • In FY17, the percent of eligible third-party revenue collected at all agency facilities was 92.0%.  This annual result met the target of a 92.0% collection rate.
  • Although the target of 92.0% was met, NMDOH continues to face challenges in collecting revenue timely and efficiently at each facility due to claims rejections that are occurring and being unable to retain highly skilled medical billing staff.
  • NMDOH continues to strengthen collection efforts. 

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