Discharged not final billed (DNFB) is a critical factor impacting the financial health of healthcare organizations. Managing DNFB effectively can lead to faster cash flow, reduced denials, and improved revenue outcomes. As hospitals and healthcare providers navigate complex billing processes, it becomes essential to implement best practices that streamline workflows, leverage technology, and foster collaboration among departments. Understanding the nuances of DNFB and adopting proactive strategies are vital steps toward ensuring financial stability and operational efficiency.
What is DNFB in Healthcare?
In the context of healthcare billing, accounts are designated as Discharged not Final Billed (DNFB) when patients have completed their treatment or stay at a facility, but the final billing has not yet been generated. Typically, after discharge, there is a hold period—often between three to five days—during which the hospital verifies that all documentation, including charges, coding, signatures, and procedure logs, are complete and accurate. This period allows administrative teams to ensure compliance and completeness before submitting claims.
Once this hold period concludes, claims are sent to a clearinghouse, which acts as an intermediary to validate and process billing information. Electronic Health Records (EHRs) are equipped with rules that prevent claims from processing if critical information, such as diagnosis codes or signatures, is missing. These rules can be organized into worklists that flag accounts requiring attention. When all necessary data is verified, the claim is released for submission. However, even then, complex billing rules or missing documentation may cause claims to be rejected or held in DNFB status.
The efficiency of this process depends heavily on the sophistication of the EHR system. Advanced systems categorize issues into manageable worklists, ensuring timely resolution. When errors are identified—such as missing diagnosis codes or incomplete documentation—the claims are flagged for review, making it easier for billing staff to address issues promptly before submission.
How is the DNFB Calculated?
DNFB is measured by dividing the total dollar amount associated with unbilled discharged accounts by the average daily gross patient service revenue. This ratio provides a clear indicator of revenue cycle performance and is one of the key metrics recognized by the Healthcare Financial Management Association (HFMA). Specifically, the days in DNFB, part of HFMA’s MAP Keys, reflect the average number of days claims remain unbilled after discharge, highlighting potential bottlenecks in the revenue cycle.
Monitoring the DNFB rate helps organizations identify delays and inefficiencies that may hinder cash flow. A rising DNFB can signal issues such as documentation delays, coding errors, or technical problems within the billing system. Regularly calculating and analyzing this metric enables healthcare providers to implement targeted interventions, improving overall financial health.
What Causes DNFB to Increase?
Several factors contribute to an increase in DNFB levels. Historically, hospital billing involved close collaboration between the Business Office and Medical Records departments to review each discharged patient account manually. Today, technological advancements have shifted this process, allowing reports to be generated directly from the EHR system. However, these reports are only as accurate as the data within the system.
Common causes of DNFB escalation include inaccuracies or omissions in documentation, such as incomplete diagnosis or procedure information, missing signatures, or discharge details. Specific issues that can lead to claims being held in DNFB include:
- Medical necessity denials or documentation gaps
- Charge reconciliation errors or service separation issues
- Lack of required insurance authorizations
- Incorrect insurance or payor information
- Outdated or inaccurate insurance verification
Regularly updating the EHR with current coding standards, such as annual CPT code revisions, is essential. Failure to do so may result in claim rejections and increased DNFB. Ensuring that all systems are synchronized with the latest coding and billing requirements minimizes delays and enhances claim accuracy.
Why Does DNFB Matter So Much?
The impact of DNFB on a hospital’s revenue stream cannot be overstated. Each day that an account remains in DNFB status translates into delayed cash inflow, affecting the organization’s liquidity and operational capacity. The dollar value associated with unbilled accounts accumulates daily, representing lost revenue that could otherwise be reinvested in patient care, staff, or infrastructure.
Effective management of DNFB directly correlates with improved cash flow. For example, during a recent engagement, JTS Health Partners successfully reduced DNFB by 56%, unlocking over $25 million in cash flow. This demonstrates how targeted strategies to address DNFB can significantly influence financial outcomes and organizational stability.
How Do You Manage DNFB in the Revenue Cycle?
Successful DNFB management requires a comprehensive, proactive plan. Daily monitoring of the DNFB list is crucial to identify and address issues promptly. When documentation deficiencies are identified, especially from physicians, engaging clinical staff to improve the completeness and accuracy of clinical documentation is essential. Strengthening communication between billing, medical records, and clinical teams ensures that documentation supports claim submission efficiently.
Understanding and adhering to insurance contract rules also plays a pivotal role in reducing denials and subsequent DNFB. Regular training and audits help maintain compliance and accuracy, ensuring claims are clean before submission. The ultimate goal is to send out claims that are free of errors, reducing the likelihood of rejection or delays.
Who Monitors DNFB?
A dedicated team or individual should oversee DNFB management. Typically, the responsibility falls to the Health Information Management (HIM) department manager, who, in collaboration with the IT team, develops and maintains monitoring processes. The Chief Financial Officer (CFO) also plays a strategic role, reviewing reports and ensuring that appropriate actions are taken to resolve issues swiftly.
What Is a DNFB Report?
Traditionally, hospitals generated DNFB reports manually. Today, with advanced EHR systems and analytics tools like JTS’s nCREAS™, these reports can be extracted automatically, providing real-time insights. The nCREAS™ platform aggregates data to produce detailed reports, including account aging, dollar amounts, payor-specific data, and reasons for claim denials. This level of detail enables organizations to identify trends, prioritize high-impact accounts, and implement targeted interventions to reduce DNFB durations.
Five Steps to Reduce DNFB
While human error and technological issues can contribute to elevated DNFB levels, organizations can implement these five strategic steps to improve their revenue cycle performance:
1. Develop a Robust Revenue Cycle Strategy
A comprehensive Revenue Cycle Management (RCM) plan ensures the entire process—from patient intake to final payment—is monitored and optimized. Regular oversight of the DNFB list is essential to identify bottlenecks early and implement corrective actions promptly.
2. Automate Processes Using Advanced Revenue Cycle Technology
Leveraging automation tools within your EHR and billing systems can streamline workflows, reduce manual errors, and accelerate claim processing. Consulting with revenue cycle experts, like JTS, can help tailor these technologies to your organization’s needs.
3. Invest in Staff Training and Adequate Staffing
Proper training ensures staff are knowledgeable about documentation requirements, coding standards, and billing procedures. Maintaining appropriate staffing levels prevents overload, reduces errors, and enhances the efficiency of the billing process.
4. Maintain an Accurate and Up-to-Date Charge Description Master (CDM)
The CDM lists all billable items, including descriptions, revenue codes, and applicable CPT/HCPCS codes. Regular updates—especially after annual code revisions—are critical. An outdated CDM leads to claim rejections and increased DNFB, so ongoing maintenance is vital.
5. Utilize Analytics for Continuous Improvement
Analytics tools like nCREAS™ enable organizations to track DNFB trends, identify aging accounts, and analyze denial reasons. These insights facilitate targeted interventions, reducing the overall DNFB and enhancing cash flow.
How JTS Health Partners Supports DNFB Management
JTS employs tools like nCREAS™ to analyze DNFB data comprehensively. This platform categorizes unbilled accounts, tracks aging patterns, and pinpoints specific issues causing delays. Collaborating with clients, JTS helps identify aged accounts for prompt resolution and assesses which physicians or departments contribute most to delays. Based on these insights, tailored policies and procedures are developed to improve clinical documentation and expedite billing processes.
Ready to Strengthen Your Revenue Cycle?
Implementing a strategic plan to reduce DNFB is essential for maintaining healthy cash flow and operational resilience. Contact JTS to explore customized solutions that streamline your billing processes and improve revenue outcomes. For more insights into the evolving landscape of healthcare technology, explore how emerging AI solutions are transforming patient care. Understanding the fundamentals of the healthcare ecosystem also supports better decision-making when optimizing revenue cycles. If you’re considering expanding your healthcare operations, guidance on establishing a healthcare organization from the ground up can be invaluable.