This is the first in a series of four posts discussing how a revenue integrity program can help clinical, compliance and revenue cycle teams join forces to address the increasing challenges associated with compliance.
Hayes' Healthcare Blog
Much of the healthcare industry is focused on reaching the goals of the Institute of Healthcare Improvement’s Triple Aim – improving health outcomes, enhancing the patient experience and lowering the per capita cost of healthcare. By any measure, the growing area of telehealth checks all three boxes.
Improved health outcomes? In an American Journal of Critical Care survey, eight out of ten nurses agreed that tele-ICU systems enable them to improve patient care. They said the technology allows them to remotely review patient vital signs, physiological status and laboratory and diagnostic test results to help make better healthcare decisions.
Enhanced patient experience? A study published in the Annals of Family Medicine reports that patients who were offered primary care telemedicine during a pilot program in Pennsylvania experienced high satisfaction. They noted the convenience of eliminating the need to miss work, travel to an office, arrange childcare and change attire as reasons. They also cited decreased wait times compared to in-office visits.
Reduced cost? Spectrum Health, a provider based in Grand Rapids, Michigan, saved insurers nearly $4.1 million from 2014 to 2017 by delivering almost 50,000 virtual visits that avoided more than 11,000 emergency room trips. So far in 2018, Spectrum’s telehealth program has saved insurers almost $1.5 million.
So, telehealth is the perfect solution, right? Not so fast. Especially if you are a provider facing the not-so-small problem of getting paid. While telehealth appears to be a viable healthcare delivery alternative, reimbursement issues continue to be an issue, and if not handled correctly, can adversely affect your organization’s revenue integrity.
In today's challenging financial environment - plagued by shrinking revenue, narrowing margins and tightening regulatory constraints - many healthcare leaders are stepping back to take a more holistic view of their organization’s revenue stream. They understand that the traditional, silo'ed approach to revenue cycle and compliance - in which the two functions operate independently from one another - is not going to help them achieve their goal of optimizing their financial health.
These leaders are beginning to see the value of bringing these disparate groups together to effectively address their top- and bottom-line issues. For many, that means implementing a comprehensive revenue integrity program that can serve as the “backbone” supporting such an effort.
The dictionary defines a “backbone” as “the chief support of a system or organization.” A well-developed revenue integrity program can be the “chief support” that links together revenue cycle and compliance, resulting in a more robust revenue stream, decreased risk of costly non-compliance, and enhanced bottom-line performance.
Here are five benefits that can be achieved by instituting a common revenue integrity backbone in your organization.
You’ve been struggling with the need to improve your bottom line while reducing organizational costs. New financial models, increased cost shifts to patients and continued merger and acquisition activity are leading to an increased focus on your organization’s overall financial health. Up until now, you’ve likely relied on revenue cycle management (RCM) which has served you well, but you now recognize that RCM doesn’t go far enough. You need something more, so you’ve decided to implement a more holistic revenue integrity program.
Revenue Integrity – getting paid for everything you do, and keeping it – takes a broader view of the organization’s revenue stream. A revenue integrity program evaluates many of the same people, processes and technology as RCM, but goes a step further by understanding how these various disparate processes can be connected to optimize the entire revenue cycle.
By Peter Butler, President and CEO, Hayes Management Consulting
As part of our commitment to helping healthcare organizations optimize their business processes to achieve greater revenue integrity, Hayes has recently formed a Revenue Integrity Advisory Council (RIAC), a small group of revenue cycle and compliance executives who understand the real-world financial challenges associated with running a large, complex organization. We held our first meeting on March 20th in Chicago, where leaders from some of the nation’s most prestigious healthcare organizations gathered for an afternoon to discuss issues, exchange ideas and develop new solutions for overcoming some of their most pressing concerns.
So what was on their minds? Not surprisingly, the topics covered a range of issues including telehealth, quality-based reimbursement, and high-cost drug reimbursement, as well how to organize the coding function and managing compliance issues.
Managed care contracts make up a significant amount of a healthcare organization’s revenue stream. The impact these contracts can have on your top and bottom lines makes managing them appropriately one of your top priorities. Those organizations that have realized this and have an effective, efficient contract management process in place have a reasonable upper hand over those that don’t.
Staying on top of your managed care contracts is critical to maintaining a sound financial foundation. Managing these contracts successfully can help drive additional revenue through new insurance products. Properly handled managed care contracts can also increase patient satisfaction by enabling patients to obtain the treatment they need.
If you have challenges in keeping track of and managing your contracts, you are not alone; it is an all too common problem in hospitals and healthcare organizations across the county.
Here are 11 things to consider that can help you develop and administer a successful contract management process.
Are you drowning in claim denials and rejections? Are your denial rates high? It is inevitable for healthcare organizations to experience denials in today’s complex billing arena. Industry standards for denial rates are between 5-10 percent. If your denial rate is above 10 percent, then "Houston you have a problem!” It is time to build a strategy to reduce your denial rate.
Claims denial avoidance processes should be proactive but in most healthcare organizations, they are more reactive. It is important to be proactive from a revenue integrity perspective at the front-end, and accurately collect and report patient and insurance information before or at the point-of-service. There are ways to be proactive from the billing side as well.
As you develop your action plan, it’s important to define your terms. You and your staff need to understand the difference between a claim rejection and a claim denial.
Low hanging fruit. You likely hear the term nearly every day in the business world. It refers to something easy to reach and therefore should be “picked” first. It has also come to mean an area where you can concentrate your efforts to get the most results.
In healthcare finance, low hanging fruit is often used as a descriptor of the easiest money to collect on outstanding accounts receivable. Revenue Cycle teams focus on Medicare, Medicaid, and specific major payers that make up the majority of their revenue.
Working the payers that will yield 80 percent of your revenue – Medicare, Medicaid, and two or three of your major commercial plans - makes sense and should be the first line of attack when looking to collect outstanding revenue. But what about the “fruit” that is further back and higher up in the “trees?” What about that other 20 percent of your revenue?
You shouldn’t be content with disregarding 20 cents of every dollar. With improvements in automation and technology, it’s time to take another look at this still-very-valuable component of your receivables and begin mapping out a new attack plan to collect it.
Organizations about to undergo an IT systems transition must develop a comprehensive task list to ensure the project is successfully completed. However, one of the key aspects of the conversion is sometimes overlooked: how is the retirement of the legacy system to be handled. The legacy system being replaced still must be up and running and properly maintained to ensure it services the needs of the organization during the implementation. Failure to include a plan to make that happen can have serious negative consequence in terms of efficiency and productivity. It can also affect patient care if clinicians aren’t able to rely on the legacy system to do their jobs during the transition.
As you prepare for your implementation and legacy system retirement, here are six questions to ask to help you develop your plan.
Research from the Medical Group Management Association (MGMA) estimates that payers underpay practices in the U.S. by an average of 7% – 11%. In a time when budgets are tightening and reimbursements are shrinking, it’s more important than ever to make sure your organization is being paid correctly. Some organizations take this seriously but many don’t spend nearly enough time focusing on underpayments and their bottom lines suffer as a result.
Forward looking healthcare systems that are committed to a robust revenue integrity program, take the time to analyze their revenue and reimbursement details. Based on their success, it is clear that it’s worth the time and effort each year to make sure your contracts are up to date and that that you are monitoring your underpayments on a regular basis.
Staying on top of your underpayment activity is not as difficult as it may seem. There’s a good chance someone at your organization already has the information needed to get this ball rolling.
Here are three key things you need to implement an effective reimbursement analysis program.