Cu­rios­ity can pay

Right ques­tions can help find new rev­enue sources

Modern Healthcare - - From The C-suite - Kevin Shrake

Akey trait of ef­fec­tive ex­ec­u­tives is to ask the right ques­tions of your team. I have a re­cent ex­am­ple re­lated to rev­enue cy­cle where tak­ing a “deeper dive” into the op­er­a­tions proved ben­e­fi­cial. I knew that my fa­cil­ity, 260-bed St. El­iz­a­beth’s Hos­pi­tal in Belleville, Ill., needed a rev­enue-cy­cle ini­tia­tive to im­prove mar­gin, and the fi­nance team in­formed me that there was a plan in place. Rev­enue cy­cle is a broad cat­e­gory, so ask­ing more spe­cific ques­tions to iden­tify ex­actly what we were do­ing proved ben­e­fi­cial.

We were do­ing a good job with cod­ing, as ev­i­denced by a re­cent 10% in­crease in casemix in­dex as our coders learned more com­pre­hen­sive meth­ods to ac­cu­rately doc­u­ment the work that had been per­formed. We were also do­ing a good job re­view­ing the ac­cu­racy of how our pay­ments from com­mer­cial pay­ers matched our con­trac­tual agree­ments. This was be­ing ac­com­plished via a con­tract man­age­ment soft­ware pro­gram that could make those as­sess­ments faster and more ac­cu­rately than through man­ual anal­y­sis.

How­ever, there were other key el­e­ments of a com­pre­hen­sive pro­gram that we were not pur­su­ing, so we were leav­ing money on the ta­ble. One of those was a trans­fer DRG anal­y­sis. When it is iden­ti­fied that a pa­tient is be­ing trans­ferred from an acute-care hos­pi­tal to an­other fa­cil­ity, such as a nurs­ing home or ex­tended-care fa­cil­ity, the to­tal DRG pay­ment is re­duced. There are pro­grams avail­able to ret­ro­spec­tively ver­ify that trans­fers oc­curred. This al­lows many hos­pi­tals to re­coup rev­enue for trans­fers that did not oc­cur. Not only is there an op­por­tu­nity to en­sure that DRG pay­ments are not er­ro­neously re­duced mov­ing for­ward, but you can do a ret­ro­spec­tive anal­y­sis and re­bill those ac­counts that should have been paid at the full DRG rate.

At St. El­iz­a­beth’s, this op­por­tu­nity was nearly $100,000. That gain led to a de­ci­sion to im­ple­ment a sys­temwide anal­y­sis across all 13 hos­pi­tals op­er­ated by Hos­pi­tal Sis­ters Health Sys­tem, Spring­field, Ill.

A sec­ond op­por­tu­nity re­lated to us­ing technology again to “scrub” the data­bases was used to iden­tify Med­i­caid pa­tients. If there is not an ex­act match be­tween the hos­pi­tal en­try and what is in the state data­base, it ap­pears that cer­tain pa­tients are not el­i­gi­ble for Med­i­caid when in fact they are al­ready qual­i­fied. This can re­sult in a loss of rev­enue as peo­ple are chan­neled into the self-pay or char­ity-care cat­e­gories.

Even though our team thought we had this cov­ered, us­ing ded­i­cated soft­ware to con­duct a ret­ro­spec­tive “payer search” re­sulted in an ad­di­tional $30,000 of new rev­enue for our fa­cil­ity. This sup­ported a sec­ond sys­tem wide ini­tia­tive, re­sult­ing in ad­di­tional rev­enue for our health­care sys­tem.

Even if you have a rev­enue­cy­cle pro­gram in place, don’t as­sume that ev­ery op­por­tu­nity is be­ing ad­dressed. Ask your team spe­cific ques­tions about code pair­ing, trans­fer DRGs, payer search, cash ac­cel­er­a­tion pro­grams and point-of-care test­ing. Also, make sure that your team has the ap­pro­pri­ate ed­u­ca­tion avail­able to them to do their job well. Changes in rev­enue­cy­cle con­cepts oc­cur fre­quently, which makes a con­tin­u­ous ed­u­ca­tional process es­sen­tial. A suc­cess­ful pro­gram also puts the right technology in the hands of your peo­ple to sup­port their ac­tiv­i­ties. Soft­ware pro­grams specif­i­cally de­signed to as­sist well­trained em­ploy­ees in man­ag­ing rev­enue cy­cle is a pow­er­ful com­bi­na­tion.

It should be noted that hav­ing an ef­fec­tive rev­enue-cy­cle pro­gram is not con­tra­dic­tory to hav­ing a “com­pli­ance-fo­cused cul­ture” in your or­ga­ni­za­tion. To the con­trary, hav­ing sys­tems in place that en­sure the ac­cu­racy of doc­u­men­ta­tion, billing and col­lec­tion pro­ce­dures sup­ports an or­ga­ni­za­tion wide phi­los­o­phy of com­pli­ance.

Health­care re­form will con­tinue to place sig­nif­i­cant chal­lenges on the abil­ity of hos­pi­tals to achieve a sus­tain­able mar­gin. Pro­grams to en­hance your rev­enue cy­cle are key el­e­ments of mar­gin devel­op­ment. Suc­cess­ful CEOs ask the right ques­tions and hold their team ac­count­able for the an­swers. Kevin Shrake was pres­i­dent and CEO of St. El­iz­a­beth’s Hos­pi­tal, Belleville, Ill., from Jan­uary 2008 to March 2010 and is now ex­ec­u­tive vice pres­i­dent and chief op­er­at­ing of­fi­cer of MD Re­sources, Fresno, Calif.

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