Revenue Cycle Realities

1. Revenue Cycle Realities Valerie A. Rinkle, MPA Revenue Cycle Director Asante Health System

2. The Financial Equation • Revenue minus expense = bottom line • Improved bottom line comes from either increasing revenue, decreasing expense or both!! • Revenue Cycle Managers just like Clinical Managers must be successful at both!

3. Today’s Agenda • Review phases & functions of Revenue Cycle Operations • Discuss management issues for Revenue Cycle • Discuss operational challenges & people/process/technology solutions for some of those challenges • Discuss strategies for collaborating with clinical & non-clinical departments crucial for Revenue Cycle success • Future Issues Raising Challenges

4. Major Phases of Revenue Cycle • Pre-Service • Service Delivery • Account Suspense Period • Billing & Collections • Each phase consists of several functions performed sequentially and/or concurrently

5. Management of Revenue Cycle • Overarching all phases & functions of the revenue cycle is the management of people, processes & technology • Improvement analytics should dictate prioritization • Regardless of organizational structure, collaboration with other departments is crucial for revenue cycle success

6. Management of Revenue Cycle (cont.) • For each function of revenue cycle – think about: • Quality improvement/cost reduction/automation & informatic initiatives & strategies • Compliance & documentation requirements • Employee success initiatives • Patient satisfaction initiatives • Alignment with Organization’s strategic plan • Outcome measures with targets and results • Barriers & key stakeholders • Who is the leader for this area

7. Pre-Service Phase Functions • Scheduling • Eligibility Verification • Pre-Admission • Financial Counseling/Healthcare Eligibility • Coverage, Authorizations & Waivers • Point-of-Service Collections • Compliance & Documentation of all functions

8. Scheduling • Centralized Scheduling? • De-centralized Scheduling? • Feedback loop for missing information? • Relationship to authorizations? • Late Add-On Accounts?

9. Verification • Eligibility Verification • Real time? • 270/271 batch? • Manual web site reseach • Web-bot technology? • CMS instability/OR MMIS inaccuracy

10. Pre-Admission • Creating accounts versus calling patients- work list differentiation • Swing shift schedules for optimal patient contact • Scripting to support patient satisfaction initiatives • Late add-on analysis

11. Financial Counseling/Healthcare Eligibility Assessments • Financial Assistance Policy – Up-Front Charity determination • Financial Assistance for elective procedures? • True Self Pay contractual at average commercial rates or Medicare rates • Terms for interest-free payment plans • Loans for long-term payment plans • Publicizing Financial Assistance • Expert Governmental Healthcare Eligibility Assistance

12. Coverage Verification/Authorization & Waivers • Authorizations – Notification of admission versus authorization for O/P service • Professional versus facility authorization • Imaging authorizations • Referring Office Issues • 2010 OIG Advisory Opinions • Registration staff versus RNs? • Reference labs – missing info on orders • ABNs for O/P Services • OHP ED Waivers for non-emergent use of ED

13. Point-of-Service Collections • Cost Estimates – how services are scheduled vs how they are billed? • Incentives for up-front payment? • Prompt-pay discounts? • Phone collections during Pre-Admission? • ED collections • Inpatient Admissions • Incentives for staff to collect

14. Compliance & Documentation Requirements • Condition of Services Rendered, HIPAA, Patient Rights, Genetic Research Opt-Out,Red Flag • Financial Assistance & Cost-estimate • IMM/ABN/Waivers • Off-campus PBD cost estimates • eSignature – direct to EMR vs paper & scan • Audit software to edit/audit all accounts • Productivity standards

15. Timing is Everything! • A lot of work happens between the service being scheduled and the actual date of service – how much time is optimal? • More & more requirements at time of Patient Check-in- How much time needed to keep Clinical on-time?

16. Service Delivery Phase • Activate the account – correct inpatient admission date/time • Admission status • Documentation of services – orders & execution of orders • Charge capture – dep't info systems, EMR vs key punch & development from documentation

17. Suspense Phase • Begins at Discharge – ends when bill drops • Charge capture reconciliation • Charge capture audits w/o coding • Coding – automated work lists, telecommunting, cross-training, ICD10 • Coding & charge capture edits w/coding

18. Billing & Collections • Day end automation • CDM & profile maintenance in AR system • Informatics • 3-day rule, readmissions (Medicare vs Medicaid) • Adverse Event auditing • Claim scrubbing/clearinghouse • Account segmentation for AR follow-up • Payment validation • ERA/Lockbox • On-line patient payments & discounts

19. Billing & Collections (cont.) • Late Charge Management • Denial Management • Financial Assistance Approvals • Account segmentation for collections – in-house vs outsourcing • Batch 270/271 eligibility • Collection cycle – scripting, prompt-pay discounts & dunning messages/timing • Collection practices – agencies, liens, etc.

20. Important Definitions FYI • Never Events – 3 types of Adverse Events that are NEVER covered by insurance: • 1-Procedure performed on the wrong body part • 2-Procedure performed on the wrong patient, or • 3-The wrong procedure performed on the patient

21. Important Definitions FYI • Adverse Events – OAHHS defined a list including such things as foreign body retention after procedure, blood incompatibility, burn caused by facility • Commercial plans & their lists - Contracts • Hospital-Acquired Conditions – Defined by CMS based on coding of conditions not Present on Admission (POA) such as stage 3 or 4 pressure ulcers, UTI from indwelling catheters.

22. Denial Management • Tracking RAC requests • Collaborating with Release of Information • Chart analysis prior to sending to RAC • Response letter and appeal tracking • Results reporting to Management

23. RAC Experience • Automated & Complex Accounts • Under 100 accounts? • 100-500 accounts? • 500-1000 accounts? • Over 1000 accounts? • Appeals for Automated & Complex Accounts? • Complex for DRG, Medical Necessity, Other? • Part B RACs – supplies, coding, other?

24. Strategies for Collaboration • Revenue Dept Mgr Education on Denials - Government payers and increasingly commercial insurances are mounting massive initiatives to take away payments we have already received. We have to get better at documentation and following complex rules to hold onto our payments from Medicare, Medicaid & Commercial payers. Health reform increases these initiatives!!

25. Strategies for Collaboration (cont.) • Explain Revenue Cycle’s relationship to the Value Equation • Value Equation: Quality/Cost • Reduced readmissions • Reduced Hospital-Acquired Conditions • Reduced adverse/serious safety events • Improved compliance with I/P & O/P CMS Core Measures • Improved patient satisfaction

26. Strategies for Collaboration (cont.) • Explain Revenue Cycle’s Role in Improving Customer Service • Customer Service • Patients increasingly expecting up-front estimates • ADT linking to EMR – safety in correct patient ID paramount! • Performing your organizations values consistently with each interaction throughout the Revenue Cycle • Patient relations & Risk Management

27. Strategies for Collaboration (cont.) • Educate PI, Risk Mgt & Revenue Dept Mgrs on Documentation Needs based on Denial Analysis • Clinical staff should “Always Consider” – Can I, as a provider of service tell the story of my patient care from the resulting documentation [i.e., the legal medical record] one or more years after the service?

28. Strategies for Collaboration (cont.) • Clinical Documentation Improvement Program • Coding & CDIS staff collaboration critical • Review of RAC denials • Adjusted mortality • Since only physicians and other practitioners can diagnose & perform certain procedures by virtue of their scope of practice, then only their authenticated documentation can be used to substantiate coding

29. Strategies for Collaboration (cont.) • Is your IT department maxed-out with meaningful use projects? • Consider a Revenue Cycle IT dept • Is Revenue Cycle present at CPOE & EMR planning sessions? Charge capture automation possible with EMR integration.

30. Future Issues & Challenges • ICD10 • Increased regulations of outpatient services • Payment Reform • Cost Reform

31. ICD10

32. Outpatient Services • Two types of outpatient services: • Diagnostic – think tests • Therapeutic including ED visits & RN services – think assessment/tx • CMS supervision rules • Orders for services – electronic vs paper vs oral • Provider-based – how much longer?

33. Payment Reform • Financial systems & allocation strategies – RBRVS, fee schedules, Medicare rates, aligning incentives • Bundled payments • Accountable Care Organizations • Oregon – exchange estimated 34% of population on State exchange insurance

34. Cost Reform • Bending the cost curve • Automation & Informatics • Performance standards • Telecommuting • Presumptive charity • Aligning incentives

35. Questions?

36. Thank you!!