Results Delivered. Bottom Line.
February 18, 2011
Oregon HFMA
Winter Conference
‘Trends in POS Cash Collections’
Presented by
James McHugh
© 2011 MultiCare Consulting Services; Proprietary and Confidential
Agenda

National Trends in POS Collections

Taking the First Step

Advanced Strategies

Questions
© 2011 MultiCare Consulting Services; Proprietary and Confidential
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Results Delivered. Bottom Line.
National Trends in POS Collections
© 2011 MultiCare Consulting Services; Proprietary and Confidential
Oregon HFMA
National Trends in POS Collections

Why collect POS Cash?
 Increased cost share and high deductable health plans
 Increase Patient Satisfaction
 Educating patients on cost
 Providing financial assistance prior to service
 Low self-pay collection rates once in the billing cycle
 Average True Self Pay > 10%
 Average Self Pay After Insurance > 50%
 Avoid high cost to collect
 Internal collection efforts are costly
 Early Out Collection vendor cost ~ 5-7%
 Reduce Self Pay A/R days
 Reduce Bad Debt and Charity Write-offs
© 2011 MultiCare Consulting Services; Proprietary and Confidential
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Oregon HFMA
National Trends in POS Collections

Where does your organization stand?
 Average POS Collections as % of Net Patient Revenue
 If you are a Medium $400M Net Patient Revenue Hospital:
 Do you collect < $2M in POS Cash ( < 1%)?
 Do you collect between $2-4M in POS Cash (1-2%)?
 Do you collect >$4M ( > 2%)?

Average POS Collections as % of Patient Cash Collections
 Regardless of your size, what % of Cash do you believe you collect as POS
cash?
 < 10%
 10%
 15%
 20%
 > 20%
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Oregon HFMA
National Trends in POS Collections

Where does your organization stand?
“Does your organization strive to be Average or in the top 25%?”
POS Collections as % of Patient Cash Collections
POS Collections as % of Net Patient Revenue
National
Average
National
Average
Top 25%
Top 25%
Top 10%
Top 10%
*Source: Point of Service Collection Benchmarks 2008 Q1 Academy of Healthcare Revenue
© 2011 MultiCare Consulting Services; Proprietary and Confidential
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Results Delivered. Bottom Line.
Taking the First Step
© 2011 MultiCare Consulting Services; Proprietary and Confidential
Oregon HFMA
Taking the First Step


Advanced technology isn’t necessary to start
collections
Start with organizational policy change
 First focus on Co pays and Self-Pay deposits in
the ED
 ED Co pays for the insured
 Set obtainable flat rates for self-pay
patients
 Track other self-pay areas
Hospital Requesting Payments in the ED
Set obtainable deposits for diagnostic procedures
Consider organizational ‘Pay or Delay’ policy for elective procedures
Focus on Coinsurance in low dollar, high volume areas
 Target OP diagnostics
 Mammograms & X-Rays
 Create Coinsurance matrix of top payer plans



*Source: Point of Service Collection Benchmarks 2008 Q1 Academy of Healthcare Revenue
© 2011 MultiCare Consulting Services; Proprietary and Confidential
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Oregon HFMA
Taking the First Step


Changing Patient & Employee culture
 Train staff on customer service and scripting
 Ensure compliance with frequent shadowing
 Reinforcing patient expectations and behavior
Begin tracking POS cash collections
 Track at a high level based on Financials
 % of Patient Net Revenue
 % of Patient Cash Collections
 Track at the service level
 Pre-Service Center POS
 ER POS Collection
 OP Diagnostics POS
 OP Specialties POS
 Track at the employee level
 Incentive performance
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Results Delivered. Bottom Line.
Advanced Strategies
© 2011 MultiCare Consulting Services; Proprietary and Confidential
Oregon HFMA
Advanced Strategies



Only 50% of hospitals can effectively estimate patient liabilities*
In order to master advanced POS collection, your organization must be able to
effectively estimate patient liabilities:
 Simple Charge Master pricing
 Use for self-pay on simple procedures
 Uninsured Discounts
 Don’t forget to incorporate your organizations’ self pay discount policies
 Payer contracts
 Plan specific benefits and reimbursement
 Useful for low dollar high volume OP procedures
 Historical Claim Data
 More complex IP procedures
 Estimate Lower and Upper ranges
 Develop Case Rates based on low ranges
General Rule: Always collect the lower range of estimates to avoid patient refunds
*Source: Academy of Healthcare Revenue
© 2011 MultiCare Consulting Services; Proprietary and Confidential
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Oregon HFMA
Advanced Strategies

Homegrown Estimation vs. Vendor Tools
 Of the hospitals the estimate patient liabilities, 58% utilize a home grown tool
rather than a vendor tool*
 Vendor tools are only as good as the data that is given
 Ensure that your CDM is valid
 Validate payer plan build in the contract management system
 Building a patient estimation tool (internal or vendor) is not a simple undertaking
and requires assistance from multiple departments:
 Patient Access
 Patient Financial Services
 CDM
 IT
*Source: Academy of Healthcare Revenue
© 2011 MultiCare Consulting Services; Proprietary and Confidential
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Results Delivered. Bottom Line.
Questions
© 2011 MultiCare Consulting Services; Proprietary and Confidential
13
Results Delivered. Bottom Line.
James McHugh
St. Charles Health System
Interim Revenue Cycle Director
jamchugh@stcharleshealthcare.org
MultiCare Consulting Services
Consulting Services Director
james.mchugh@multicare.org
MultiCare Health System
Revenue Cycle Consulting Services
737 S. Fawcett Ave
Tacoma, WA 98415
Phone: 253-459-8100
Fax: 253-459-7863
http://www.multicareconsulting.com
© 2011 MultiCare Consulting Services; Proprietary and Confidential