Revenue Cycle Realities
Valerie A. Rinkle, MPA
Revenue Cycle Director
Asante Health System
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!
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
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
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
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
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
Scheduling
•
•
•
•
•
Centralized Scheduling?
De-centralized Scheduling?
Feedback loop for missing information?
Relationship to authorizations?
Late Add-On Accounts?
Verification
• Eligibility Verification
– Real time?
– 270/271 batch?
– Manual web site reseach
– Web-bot technology?
– CMS instability/OR MMIS inaccuracy
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
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
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
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
Compliance & Documentation
Requirements
• Condition of Services Rendered, HIPAA,
Patient Rights, Genetic Research OptOut,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
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?
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
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
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
Billing & Collections (cont.)
•
•
•
•
Late Charge Management
Denial Management
Financial Assistance Approvals
Account segmentation for collections – inhouse vs outsourcing
• Batch 270/271 eligibility
• Collection cycle – scripting, prompt-pay
discounts & dunning messages/timing
• Collection practices – agencies, liens, etc.
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
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.
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
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?
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!!
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
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
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?
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
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.
Future Issues & Challenges
• ICD10
• Increased regulations of outpatient
services
• Payment Reform
• Cost Reform
ICD10
ICD9 Diagnosis Codes
Used by hospitals, physicians & payers.
Dependent on practitioner documentation
Approximately 14,000 codes
Alpha-numeric 2-5 characters
Few codes available for expansion
Lacks detail w/non-specific codes
ICD9 Procedure Codes
Used by hospitals & payers for Inpatients
Dependent on practitioner documentation
Approximately 3,000 codes
Based on outdated terminology
Few codes available for expansion
Lacks detail w/o method or approach for
procedures or body part definitions
Limits DRG assignment
ICD10 Diagnosis Codes
Used by hospitals, physicians & payers.
Dependent on practitioner documentation
Approximately 68,000 codes
Alpha-numeric 4-7 characters
Codes available for expansion
Very specific for improved reporting of
morbidity
ICD10 Procedure Codes
Used by hospitals & payers for Inpatients
Dependent on practitioner documentation
Approximately 87,000 available codes
Reflects current terminology & devices
Codes available for expansion
Precisely defines procedures w/detail on
body part, approach, method & devices
used.
Allows improived DRG definitions for new
technology and devices
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?
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
Cost Reform
• Bending the cost curve
– Automation & Informatics
– Performance standards
– Telecommuting
– Presumptive charity
– Aligning incentives
Questions?
Thank you!!