Workforces United Hospital Revenue Assessment Example

Hospital Revenue
Assessment Proposal
Introduction
 Background:
 Health information management
 Workflow re-engineering
 Business gap analysis
 Revenue cycle management
 Cost allocations
 Vendor management
 Contract Negotiations
Workforces United LLC

Assess and quantify opportunities for improvement in
revenue cycle performance that can result in additional cash
and net revenue. Areas addressed included:
Measurement and Reporting, Information Systems

Scheduling, Pre- Charge Case Medical Billing Contract Collections Cash Customer
Information Admitting,
Registration
Certification Entry Management Records
Authorization
Management Follow-up Posting Service
Save$
Pricing, Managed Care Contracting, Reimbursement
• Process Effectiveness & Accuracy • Uncompensated Care

• Metrics & Reporting • Avoidable Write-Offs
• Organization & Governance • Denial & Adjustment Management
• Cash Acceleration Opportunities • Charge Capture & CDM Maintenance
• Patient Access • Strategic Pricing
• Self Pay & Bad Debt Management • Managed Care Contracting

Revenue Cycle
Month
Project Tasks 1 2 3 4 5 6 7 8 9 10 11 12
Project Management and
RCLC
I.T. Optimization
Denial Mgmt, POS,

Patient Access and Self
Pay Strategies
CDM /Charge Capture

Managed Care
Cash Acceleration

Transition to Customer

Revenue Cycle
Today
8 to 10 months
8 weeks
Assessment Typical Implementation
Activities Develop Implement Monitor

• Perform qualitative Initiatives Initiatives Results
interviews
Activities
• Review all information and • Restructure revenue cycle operations to streamline workflows
data elements
• Implement reporting tools
• Evaluate financial and
operating information • Align departmental revenue goals, targets and accountability
• Review managed care • Train and coach front-end and back-end employees on new
contracts and pricing methods, techniques and tools
• Benchmark performance
indicators Deliverables/Outcomes
• Review organizational
• Enhance recurring cash flow
structure • Enhance operational and customer performance
Deliverables • Support an accountable revenue cycle culture
• Estimate potential financial • Cohesive and consistent approach to managing the revenue cycle
improvement opportunities • Enhanced efficiency, productivity and job satisfaction
Revenue Cycle Enhancement

5
Revenue Cycle
 Net Revenue Leakage can be reduced through:
 Integrating and standardizing workflow throughout the revenue cycle
process
 Decreasing avoidable write-offs through improved root cause identification,
denial follow-up, and resolution
 Decreasing bad debt write-offs through improved financial clearance
activities, securing additional coverage for the uninsured, and improving
patient liability collections
 Improving cash collections through reduced payment variances and
effective pursuit of expected reimbursement
 Improving collectability of A/R across all aging categories through increased
rigor and process effectiveness
 Net Revenue Enhancements can be maximized by:
 Improving charge capture of services rendered
 Improving managed care rates and strategy

Revenue Cycle
 Billing:
 Streamlining billing throughput and
Projected Gross A/R Days Performance improving follow-up enabled by
60 workflow integration and
collaboration across all revenue
cycle functions
55  Pro-active follow-up and increased
5- 8 day A/R focus on critical activities within 0-
54 reduction 90 days from discharge and
50 improved follow-up effectiveness on
accounts aged over 90 days
 Timely and effective resolution of
45
46 denials
40
Current Target

Revenue Cycle
 Denials and avoidable write-offs are a significant source of net revenue

leakage. Additionally, net revenue losses associated with denials are
occurring at a higher rate than write-off transaction data indicates.
Sample findings indicate a high volume of denied claims are being
adjusted to contractual allowances. Findings at a recent hospital
include:
 Avoidable write-offs tracked appropriately were $4M (gross) in FY08

 Of the 50 accounts reviewed for high percentage write-offs adjusted to
contractual allowance, 44% were deemed avoidable or potentially avoidable

Revenue Cycle similar findings:
 There is significant opportunity to minimize bad debt losses through POS or
Point of Service collections:
 POS collections have not been performed throughout the organization. A POS
program was to be implemented in the ED as of 3/23 and was delayed until 4/8/09
 The POS ED collection strategy will be challenged due to lack of infrastructure
(e.g. limited documented policies and procedures, limited training, lack of
communication and goals)
 There is significant opportunity to deploy an effective POS collection program
organization-wide
 The current financial counseling process is fragmented and not optimal

 Customer has recognized the need to change the current strategy and reduce
dependence on an external vendor. The plan is to bring financial counseling in-
house and minimize the use of the vendor. This strategy is supported in
conjunction appropriate training, outcomes management and rigorous vendor
management
 The current Financial Advocates spend a significant amount of time interacting
with walk-in patients versus focusing on seeing uninsured or underinsured patients
in-house

Revenue Cycle
 Within the Business Office there is significant opportunity to improve
workflow which will result in improved A/R performance and decrease
net revenue losses
 Optimizing workflow management tools and staff prioritization to promote
proactive collections
 Implementing comprehensive denial management reporting
 Implementing I.T. contract management has not been successful
 There is an opportunity to develop an overall A/R management strategy
utilizing vendor relationships in the area of small balance follow-up and Self
Pay early out program
 There are significant charge capture opportunity areas across the

organization. Opportunities include:
 Surgical supply and ancillary surgical services
 ED procedural charging
 Observation procedure and supply charging
 CDM maintenance integrity

Revenue Cycle
 Significant managed care opportunity exists:

 Outpatient and ED rates appear to below market
 There is a lot of rate variability across payers, particularly for outpatient
services
 Inpatient yields vary across service lines and present an opportunity
 Some opportunity exists through improved steerage of workers
compensation and managed government programs
 There is not a net revenue enhancement opportunity to be gained

through a strategic pricing initiative at this time. Customer’s prices were
compared to MHA’s 2008 data and are at or above market

Revenue Cycle
Supporting Analyses
 Avoidable Adjustments
 Avoidable Write-off Sampling
 Contractual Allowances Sampling
 Bad Debt Placements
 Patient Access
 Charge Capture
 Strategic Pricing
 Managed Care Contracting
 Business Office
 A/R Agings Overview
 A/R Dollar Stratification
 Active A/R Activity
 I.T. Optimization

Revenue Cycle
 Denials and avoidable write-
Customer’s Denials Noted By offs are a significant issue
Root Cause Reason across the organization
FY 2008
 Opportunities exist across
the organization to reduce
denials and avoidable write-
offs through:
 Improved patient
access eligibility and
insurance verification
screening
 Medicare medical
necessity screening
 Proactive, timely and
effective Business
Office follow-up
 Current processes and
infrastructure do not support
proactive or effective
resolution of these net
Workforces United LLC revenue losses
Revenue Cycle
Avoidable Write-off Sampling:
 Objective: Determine appropriate administrative, bad debt, and other uncompensated
care write-off reduction opportunity
 Performance Standard: Documentation of all write-offs to show timely, appropriate
steps (due diligence, linkage) were taken and that the write-offs were unavoidable
 Main Areas of Front End Process Breakdown:
 44% of accounts scored as avoidable or potentially avoidable contained
front end process breakdowns, including: Customer Write-off Summary
 Insurance verification / coordination of benefits
 Authorization / pre-certification
 Securing sponsorship / eligibility linkage Unavoidable
57%
 Main Areas of Back End Process Breakdown:
 67% of accounts scored as avoidable or potentially
avoidable contained back end process breakdowns, Avoidable
including: 21%
 Billing and appeal timeliness Potentially
 Lack of proactive and timely follow-up Avoidable
22%
 Delays in coding review
 Review Population: 100 accounts with transactions within the last 6 months
Revenue Cycle
Contractual Allowance Sampling:
 Objective: Determine opportunity to reduce avoidable contractual allowances
 Identify avoidable administrative write-offs misclassified as contractual allowances
 Performance Standard: Contractual allowances represent only appropriate discounts on
insurance payments
 Opportunity Exists for Improvement: Customer Summary of
 Accounts are being written off to contractual
Misclassified Allowances
allowances that should have been categorized
as avoidable or bad debt No
Documentation
 Many of these, based on the documentation 36% Eligibility and
Authorization
available, appear to have been avoidable 23%
(44% of reviewed population)
 Inaccurate transaction code usage was witnessed
Non-Covered Unclassified
in the account reviews 14% Denials
18%
 Review Population
 50 accounts with transactions within the last 6 months
Payment Variances
9%
Revenue Cycle
Customer’s Percent of Patient Dollars Transferred to Bad
Debt
 45.5% of
expected SPAI
dollars were
transferred to bad
debt in 2008.
This SPAI bad
debt transfer rate
presents a good
opportunity to
improve POS
collections and
avoid negative
P&L impact

Revenue Cycle
Customer’s 2008 Bad Debt Customer’s 2008 Bad Debt
Placements By Dollar Placements By Volume
 SPAI dollars represent a significant portion of Customer’s bad debt. Even more
significant is the volume of bad debt placements SPAI represents

Revenue Cycle
Point of Service Collection Opportunity by Payer and Patient Type
Customer’s top contracted payers represent 15.6% of Customer’s 2008 Bad Debt
69% of the total SPAI dollars in bad debt Placements were OP services, which are
routinely elective and/or non-emergent

Revenue Cycle
Patient Access Findings:
 Organizational Structure & Registration Services
 Patient Access leadership consists of a Registration Manager, two Registration
Supervisors and one Lead position
 Registration reports to Patient Financial Services; however, there is minimal
communication between these two departments
 There are five registration sites on campus, including the Atrium, Patient Care Center,
Imaging, Breast Imaging and the Emergency Department (ED)
 Rehab Services schedules and registers their own patients
 All registration staff are members of the union; employees are encourage to take
FMLA, creating challenges with staffing/scheduling
 Bed placement and Information Desk services report to Registration

Revenue Cycle
 Pre-Service Processes
 Scheduling is decentralized, with three non-integrated I.T. scheduling modules, as
well as manual scheduling in some areas
 Pre-registration is centralized and comprised of 4.5 FTEs that pre-register patients
via I.T. work queues
 Insurance is pre-verified for payers that are available online
 Scheduled add-ons are not processed by the pre-registration team and do not
have insurance verified prior to service
 Authorization/pre-certification functions are decentralized and not coordinated
with insurance verification
 Responsibility for medical necessity is not well defined, and there is no
accountability to ensure compliance prior to service
 There are no pre-service financial assessment or collection activities

Revenue Cycle

 Insurance Verification/Authorization
 Insurance is verified on line via McKesson/Relay, Healthia, and payer websites.
Insurance is not verified for payers not online
 Ownership for authorization/pre-certification is not clearly defined
 Insurance verification is also performed by a back-end team for accounts not
verified at time of service
 Denials related to front-end processing are not shared with the registration
leadership team

Revenue Cycle
 Point-of-Service (POS) Collections
 Training and preparation for POS collections implementation has been occurring
over the past several months
 POS collections in the ED was targeted for March 23; however, this has now been
postponed until the second week in April, occurring 4/8/09
 There has been minimal communication to key stakeholders regarding the POS
collections initiative
 There are no system-wide policies/procedures in place to govern POS collections or
cashiering protocols
 POS collection goals have not been established for all potential collection sites
 There are no plans for automated monitoring or tracking of future POS collections
 Automated tools are not available to assist with calculating patient liabilities on the
front end
 There are no prompt pay discount policies in place for front-end processing
 Outstanding balances/bad debt are not discussed with patients during pre-
registration or at point of service

Revenue Cycle
 Emergency Department
 Non-urgent patients are referred to Fast Track; however, patients are never denied
service based upon inability to pay
 ED nurses “arrive” (quick-register) patients in I.T., often resulting in errors/additional
work associated with incorrect patient information and duplicate medical record
numbers
 Mobile computers are available for bedside registration, however, registrars have
reverted back to manual procedures
 There is no financial discharge process in place for ED patients
 POS collections management and petty cash handling will be decentralized and
handled by registrars in each pod
 Financial Assistance Program

 Two Financial Advocates (FAs) currently focus on inpatient accounts
 There are no designated FAs for key intake areas/procedures such as the ED, pre-
service and high dollar outpatients

Revenue Cycle
 Financial Assistance Program (Continued)
 FAs handle all walk-in patient billing inquiries, which often hinders their ability to visit
and assess self-pay patients at the bedside
 FAs provide patients with information on state/federal programs and charity care, but
do not provide assistance with completing applications or follow through on all
uncompensated care accounts
 Financial assessment functions (i.e., Medicaid eligibility screening) are currently
outsourced to Outreach Services of Minnesota
 A proposal has been submitted to bring financial assessment functions in-house by
adding 7-9 FTEs and minimizing outsourcing activities
 Plans for in-house financial assessment implementation include shadowing staff at
Regents Hospital, hiring staff with financial counseling skills/knowledge, and internal
training and development
 There are no county caseworkers on site to assist with expediting Medicaid eligibility
processing

Revenue Cycle

 Training and Quality
 I.T. training is handled by Information Technologies, but there are no dedicated
trainers/program for front-end services
 Insurance processing/training is not managed or coordinated across the system
 There are no productivity standards, quality reviews or competency requirements in
place for front-end staff
 I.T. reports have not been developed to assist with managing front-end functions
 Staff performance reviews are very subjective; only attendance and dress code are
addressed objectively

Revenue Cycle
Charge Capture Findings:

 The current CDM process is fragmented and lacking the structure to
ensure coding and data integrity
 The Finance Revenue Coordinator is responsible for the CDM but has no
access, including view access, into the I.T. system housing the CDM
 Information services has a dedicated person responsible for the CDM. Their
responsibilities includes updating the system based on the Excel worksheet
submitted by the Finance Revenue Coordinator and e-mails by other individuals
such as Lab, Radiology, and the Billing Office
 CDM validation occurs retrospectively typically by notification from the billing
department of a claim edit or denial

Revenue Cycle
 The charge capture process, particularly, in respect to supplies and
implants lacks automation and is cumbersome and labor intensive.
This is an inefficient process and is difficult to maintain
 Pre-op surgery has evolved into the Patient Care Center Unit
 Both pre-op and outpatient procedures are performed in the PCC unit. Pre-op
nursing staff are responsible for pre-op and outpatient procedures including
procedure charge tickets leading to incomplete charge tickets and procedure
charging. The process creates bottlenecks in the OR
 The Surgical Department staff and leadership feel removed from the
revenue management function and lack clear direction on where to
find charging and coding guidance

Revenue Cycle
 A review of the Emergency Department CDM, revenue and usage
report, sample patient accounts, including their medical records, and
interviews with the ED Coding Supervisor found the following:
 Emergency department has certified coding staff dedicated to ED CPT coding and
charge capture. The current process includes chart and coding audits to assist with
identifying areas clinical documentation and charge capture improvement
 A coding supervisor performs routine chart audits and implements corrective action
plans including clinical education when findings occur
 Significant opportunity exists to improved clinical documentation and capture
separately billable procedures
• 30% of ED Level 3 and Level 4 records reviewed had documentation errors resulting in
lost charges
 A review of the Observation (OBS) sample patient accounts, including
their medical records, found opportunities for improved charge
capture
 There is an opportunity to improve nuclear medicine procedure
charging

Revenue Cycle
Strategic Pricing Findings:
 Overall, Customer appears to be above market in terms of CDM
prices
 For the procedures where competitive market data was available, 60% were
above the 75th percentile of the market
 Therefore, it is recommended that Customer not perform a
comprehensive pricing study that aligns its prices with those of its
peer group
 Generally, organizations are unable to perform a price decrease with
a zero net revenue impact. Given the financial status of the
organization, this likely should not be pursued at this time

Revenue Cycle
Managed Care Findings:
 Senior Management understands most local market dynamics,
including the area’s unique political pressures
 Managed Care management is new and eager to improve financial
yields
 Customer’s “Integrated Delivery” strategy has accumulated the
necessary components to negotiate as a true “System”
 Inpatient Yields generated from ED admissions appropriately exceed
“non-ED” inpatient admissions
 The Top 4 Payers’ Managed Care’s Inpatient yields exceed 2008
market benchmarks by 1-14%, but financial opportunities still exist

Revenue Cycle
 Managed Care revenues are fairly well disbursed across multiple payers,
but should be a higher portion of total revenues (preferably >50%)
 Growing Workers Comp. revenues would improve margins

Revenue Cycle
Managed Care Findings: Inpatient Yields
 Overall, CMI-Adjusted IP yields meet or exceed 2008 market benchmark
($2,525). However, Customer should leverage its strengths to achieve higher
rates
 $EPDs are fairly consistent, but CMI-adjusted $EPDs vary across payers
2008 CMI-Adjusted
Benchmark
= $2,525
*Top 4 Payors account for 86%

of Total Contracted Revenues

Revenue Cycle
Financial Classes’ Relative Volumes & Financial Performance
CMI- %of IP/ OP Converting Medicare
Net Rev Adjusted Medicare ER $ Per Total % & Medicaid to
Financial Class ($M) IP Days $EPD EPD Visit of Chg “Managed” products
Medicare $88 36,114 $1,478 $383 26% would improve IP yields
Managed Medicare $33 13,242 $1,503 102% $443 25%
Medicaid $17 8,967 $1,233 83% $281 21%
Mgd Medicaid $23 8,483 $2,077 141% $340 29%
Workers Comp. $7 683 $4,746 321% $1,423 73%
Workers Comp. is
Contracted Managed Care $139 32,771 $2,730 185% $671 39% quite lucrative, but
BCBS $44 10,980 $2,549 172% $741 37% low volume
Medica $27 6,512 $2,866 194% $552 39%
HealthPartners $35 8,472 $2,544 172% $675 36%
Preferred One $13 3,044 $2,773 188% $455 37% Overall yields
Select Care $14 2,031 $4,946 335% $915 62% among the top 4
Other Contracted $6 1,732 $2,053 139% $733 34% payers are fairly
consistent
NonContracted Managed
Care $9 1,384 $2,351 159% $1,732 53%
Improvement Opportunity Growth Opportunity
EPD = Effective Per Diem

Revenue Cycle
Managed Care Findings: Inpatient Service-Line Revenue Yields
 Service-line IP yields also vary significantly across payers-especially OB,
Orthopedics, and Neurology

Revenue Cycle
Outpatient & Total Yields
Outpatient & ER yields are 6

to 40% below market
averages
Total % of Charge, and

some Outpatient Yields
vary too much across
payers

Revenue Cycle
Business Office Findings:
 Workflow Management
 Key information and data necessary for optimal management of the
revenue cycle is difficult to obtain and often unavailable
 The current staffing alignment compared to accounts volumes does not
allow for proactive, timely and effective follow-up activity. Opportunity exists
to outsource certain account populations, enabling staff to focus on
accounts that will provide maximum returns
 Job aids and response guidelines do not exist
 A generally reactive approach to account follow-up leads to significant gaps
in work, delaying reimbursement
 Processes and tools to support a focused payment review function do not
exist to ensure appropriate reimbursement is secured
 While high level goals exist, individual quality and productivity standards are
not consistently defined

Revenue Cycle
 Denials Management
 Work-in-process levels are high, frequently resulting in denials, delayed
reimbursement and in some cases unnecessary write-offs
 Identification and resolution of root causes is limited and as a result,
necessary process improvements are delayed
 Avoidable write-offs consist primarily of timely filing and no authorization
denials
 Additional avoidable write-offs are misclassified as contractual allowances,
which by sampling findings is a high volume

Revenue Cycle
 Interdepartmental Communication
 Process breakdowns exist interdepartmentally and with detailed line staff
 Management exhibits candor and honesty in describing areas which they
feel require improvements
 Front end to back end communication lacks consistency, standard
measures and comprehensive reporting
 Controls over certain key processes are insufficient and essential tasks are
not consistently performed
 While current workflow management tools can support the flow of accounts
through the system, process gaps exist due to the lack of accountability
across the revenue cycle
 Upgrades and modifications to the I.T. work drivers are needed to
effectively manage and consolidate tasks, establish priority and allow staff
to work proactively throughout the revenue cycle

Revenue Cycle
Payer Specific Aging
Overall Aging of A/R
% of Account Dollars over 90 Days
% of Account Dollars
Includes all discharged AR
(both billed and unbilled) Total
A/R Aging Customer Benchmark
BC
A/R > 90 Days 22% 20%
A/R > 120 Days 18% 10% Commercial
A/R > 180 Days 12% 5%
A/R > 365 Days 3% 2% Medicare
Other
 Overall A/R Agings are slightly higher
Medicaid
than the benchmark. However, Self Pay
Self Pay
After Insurance (SPAI) is high at 83%
greater than 90 days Work Comp
SPAI
 Bill holds in I.T. and unposted cash are
contributing to higher than expected A/R 0% 20% 40% 60% 80% 100%
totals
 There is no vendor management
strategy, compromising the overall A/R
strategy and key success factors to
achieve A/R goals
Revenue Cycle
A/R Findings: Stratification by Stratification by
Account Balance Account Volume
 High dollar and low dollar
accounts provide
opportunities for different
strategies to maximize
the overall return
 Accounts >$5K+
represent 15% of total
account volume but 84%
of the total account
dollars Discharged AR (includes billed and unbilled):
Actuals % of Total
Account and $
Account
Stratification
Account $s Account Volume Account $s Volume
 Conversely, accounts (1) 0-100 $ 329,802 5,987 0.17% 13.84%
under $2K represent (2) 100-500 $ 3,878,645 13,577 1.95% 31.38%
(3) 500-2K $ 12,685,946 12,142 6.37% 28.07%
73% of total account (4) 2K-5K $ 15,591,468 4,976 7.83% 11.50%
volume and only 8% of (5) 5K-10K
(6) 10K+
$
$
16,444,340
150,271,138
2,293
4,287
8.26%
75.44%
5.30%
9.91%
total account dollars Total $ 199,201,339 43,262 100.00% 100.00%

Revenue Cycle
Accounts Receivable Sampling:
 Objective:
 Determine opportunity for cash flow improvement by reviewing the frequency, quality
and effectiveness of account processing activity (e.g., billing, follow-up, appeals)
 Performance Standard:
 More than 90% of accounts have timely, proactive and effective processing
 Proactive processing occurs at least every 30 days for accounts over $1,000 and
more frequently for accounts over $10,000
 All processing activity is thoroughly documented
 Main Areas of Process Breakdown:
 Large gaps in follow-up
Not Timely, Proactive
 Interdepartmental hand-offs or Effective
86%
 Coordination of benefits
 Billing and appeal timeliness No
Documentation
 Review Population: 8%
 50 accounts $1K+, 90+ DFD Timely, Proactive
and Effective 6%
Revenue Cycle
I.T. Optimization Findings:
 Existing revenue cycle workflows are not leveraging “best practice” standards
resulting in the sub-optimization of the I.T. integrated platform
 Although work queues exist, there are concerns that various work queue
structures are not capturing all the appropriate accounts
 Management of existing work queues is lacking resulting in many unresolved
accounts across the revenue cycle continuum
 There is a lack of understanding of I.T.’s standard reporting capabilities and
other dynamic reporting tools
 I.T. system’s training has not been adequate and the end-users’ knowledge of
I.T. functionality does not go beyond basic navigation Not Timely, Proactive
or Effective
 Limited designated resources to address both I.T. workflow and system 86%
modification requests, which is evident by the outstanding issue log

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Revenue Cycle
Revenue Cycle Leadership Recommendations:
 Implement an interdisciplinary Revenue Cycle Leadership Committee
(RCLC) charged with duties that include oversight of revenue cycle
performance, standardization, accountability, training and monitoring:
 Recurring project management meetings with all revenue cycle key
stakeholders
 Integration of hospital operations leadership into Revenue Cycle
improvement
 Standardized revenue cycle reporting tools with established baselines,
goals and monitoring of trends for net revenue dollars
 Collaboratively develop specific up front cash collections,
denials/adjustment, bad debt and accounts receivable initiative targets

Revenue Cycle
I.T. Optimization Recommendations:
 Deploy Workforces United I.T. resources to optimize revenue cycle
workflow that is enabled by I.T. over the course of the engagement to
accomplish the following:
 Maximize Customer’s IT investment by designing best-practice workflow with
Customer specific design considerations and enabled by I.T. system capabilities
 Optimize I.T.’s reporting tools that feature a wide variety of reports, queries, graphs,
and charts to manage revenue cycle performance
 Deploy contract IT resources to support the I.T. workflow optimization
efforts:
 Contract IT resources will address the technical build changes required in the I.T.
system
 Resources estimates are approximately 2 dedicated resources for 4 – 6 months.
The cost to Customer would be approximately $200K - $400K in addition to
consulting professional services

Revenue Cycle
Patient Access Recommendations:

 Organizational Structure & Registration Services
 Reassess strength, skills and responsibilities of registration leadership team to
ensure sustained improvement for front-end operations
 Develop a constructive and unified approach for communicating and sharing
information between all revenue cycle divisions
 Ensure that all intake areas either report to registration services or are trained and
monitored according to revenue cycle standards
 Realign intake staff/services in the Patient Care Center to accurately reflect
registration versus clinical responsibilities
 Reassign bed placement and information desk responsibilities to nursing and
volunteer services, respectively
 Develop a centralized registration area for inpatient/outpatient services, excluding
Breast Imaging and the Emergency Department once processes are standardized
and stabilized

Revenue Cycle
 Pre-Service Processes
 Develop new workflows to include all scheduled encounters, including add-on
procedures and high-ticket stat orders
 Realign pre-registration responsibilities to ensure that all automated work queues
are completed daily and that insurance verification, including benefit and eligibility
checks, are performed for all payers
 Redesign financial counseling processes to perform patient liability assessments
prior to service
 Centralize pre-encounter activities in a comprehensive Pre-Service Unit, including
scheduling, pre-registration, insurance verification, authorization/precertification,
medical necessity processing, and pre-service collections post process
standardization and stabilization
 Develop a centralized and fully automated scheduling approach for ancillary
services post process standardization and stabilization

Revenue Cycle
 Insurance Verification/Authorization
 Develop streamlined workflows to ensure that insurance verification occurs for all
payers, both during pre-service and point-of-service encounters
 Reallocate insurance verification resources from the back end to the front end to
support real-time eligibility and benefit checks
 Define clear responsibility and accountability for obtaining authorization/pre-cert
and coordinate with insurance verification processes
 Develop and distribute routine denial reports related to front-end processing, and
hold leadership accountable for performance improvement relative to avoidable
write-offs

Revenue Cycle
 Point-of-Service Collections
 Develop a comprehensive strategy for rolling out POS collections including:
 Project plan with definitive go-live dates and timeline accountability
 Communication plan to all key stakeholders (executive team, department heads,
Customer staff, physicians/office staff, patients, etc.)
 Identification of all potential intake/cashiering sites, including clinical areas
 Development of system-wide policies/procedures to govern both POS collections and
cashiering protocols
 Training and quality assurance program for all front-end staff, including the collection of
outstanding patient balances/bad debt
 Goals and accountability measures for all intake areas
 Tools for calculating patient liabilities due at time of service
 Equipment for processing and receiving patient payments (credit card terminals, petty
cash funds, safes, etc.)
 Automated tracking and monitoring of POS collections
 Development of prompt pay discounts and other incentives to increase up-front cash
collections

Revenue Cycle
 Emergency Department
 Reassign quick-registration responsibilities to registration staff to ensure accuracy
of medical record assignment and mitigation of risk associated with electronic
patient record
 Explore options for screening and referring non-urgent self-pay patients to
alternative treatment settings
 Reinstitute bedside registration using mobile computers
 Develop a discharge process to ensure that patients are financially assessed prior
to leaving the ED
 Develop more stringent controls for managing cash collections in the ED to ensure
optimal performance

Revenue Cycle
 Financial Assistance Program
 Develop a comprehensive strategy for managing financial counseling:
 Expand in-house program and add three (3) FTEs that are strategically located in the
Emergency Department, Pre-Service Unit and proposed Centralized Registration
Center
 Seek extensive training/education and management of financial assessment
processes, including state/federal program assistance and charity care processing;
redesign workflows to incorporate real-time assistance with application processing and
follow through on all uncompensated accounts
 Continue to utilize Outreach Services of Minnesota to assist with complex cases and
overflow from in-house program
 Contract with county office to station caseworker on site to assist with expediting
Medicaid eligibility screening
 Provide coverage for walk-in patient billing inquiries by reallocating back-end staff to
support customer service at the hospital
 Develop key performance indicators to measure and monitor financial assessment
activities performed both in-house and by outside vendor

Revenue Cycle
 Training and Quality
 Develop a comprehensive training program for all front-end services
 Develop productivity standards, key performance indicators (KPIs) and I.T.
management reports to improve and sustain operational performance on the
front end; Align KPIs with performance evaluations to provide fair and objective
staff reviews
 Develop a systematic quality assurance program to ensure front-end accuracy,
reduce bad debt and accelerate cash flow

Revenue Cycle
Charge Capture Recommendations:
 Redesign and redeploy charge capture process for surgical support
services
 Design and implement clinical department training for increased
performance expectations as related to OP documentation and missed
charges
 Emergency Department
 Observation areas
 PCC Unit
 Review performance expectations, job training and reporting relationship

for all for all OP charge entry staff
 Redesign and redeploy CDM position responsibilities, authority, system
access, and expectations
 Design and implement charge reconciliation process across all
outpatient departments

Revenue Cycle
Managed Care Recommendations:
 Customer needs to develop a comprehensive Managed Care strategy
that:
 Applies a “healthcare system” approach for leverage, including
 Hospital
 Employed and contracted physicians
 JVs & Ancillaries
 Maple Grove’s geographic leverage
 Incorporates payers’ need for Customer to remain independent & viable
 Addresses emerging market trends, including:
 Payment trends (e.g.,103-105% of Medicare for Managed Medicare products)
 More equitable provider rights
 Benefit changes & increasing patient liability
 Payers’ and Employers’ tumbling financial results

Revenue Cycle
 Customer’s strategy also needs to:
 Close market gaps and equalize payer yields for ED & Outpatient
services
 Reduce discounts for non-steered business (e.g., Trauma, ED, Air
Ambulance)
 Add carve-outs similar to market/national trends (e.g., implants, high cost
drugs, Trauma Activation, etc.)
 Further equalize IP & Service-line Yields across payers
 Consider leveraging Customer employees’ benefits for both improved
revenue & benefit administration savings
 Leverage high CMIs for higher reimbursement rates
 Pursue lucrative “psuedo-managed” lines of business (e.g., Workers
Comp, Managed Medicare, Managed Medicaid)

Revenue Cycle
 Develop more sophisticated:
 Contract modeling tools
 Contract management tools to monitor financial performance:
 Year over Year
 Actual versus Negotiated
 Year over Year changes in, and payer variances in, Patient Liabilities
 Collecting patients’ increasing liability will be critical to maximizing
contractual revenues

Revenue Cycle
Business Office Recommendations:
 Initiate a cash acceleration project to increase cash collections and
reduce A/R days
 Optimize I.T. work drivers, staff training, and supervisory expectations
 Implement a comprehensive A/R management strategy and staffing plan to
enable timely and effective A/R follow-up at all balance levels
 Implement a low-balance strategy to maximize benefits of stratification
 Develop clear goals and metrics to guide process. Create and maintain a
comprehensive staff training program including a working quality follow-up
measurement program
 Create job aids and response guidelines to direct specific tasks in a
consistent and effective manner. Presence of these job aids will allow for
consistent follow-up and timely accounts resolution, as well as, enable
objective feedback to staff
 Implement an issues database to capture and prioritize issues across the
revenue cycle that will drive specific task-oriented action plans

Revenue Cycle
Business Office Recommendations:
 Enhance and implement changes to the current denials management
program, and the tracking of avoidable write-offs
 Enhance existing reporting tools to provide additional detail and merry
denial reporting with denial net revenue losses
 Formalize and enhance processes for Revenue Cycle stakeholders across
the organization to review, discuss and resolve denial management issues,
and reduce avoidable write-offs
 Provide targeted feedback and process improvement implementation to
responsibility areas (patient access, case management, and medical
records) for denial management initiatives
 Redefine denial management workflow

Call now for an Assessment Quote
www.workforcesunited.com
Phone: 1-800-977-2364
Fax: 1-888-558-6732

Workforces United Hospital Revenue Assessment Example

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Workforces United Hospital Revenue Assessment Example

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Hospital Revenue

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Measurement and Reporting, Information Systems

• Process Effectiveness & Accuracy • Uncompensated Care

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Denial Mgmt, POS,

CDM /Charge Capture

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Assessment Typical Implementation

Activities Develop Implement Monitor

Revenue Cycle Enhancement

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 Denials and avoidable write-offs are a significant source of net revenue

 Avoidable write-offs tracked appropriately were $4M (gross) in FY08

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 The current financial counseling process is fragmented and not optimal

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 There are significant charge capture opportunity areas across the

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 Significant managed care opportunity exists:

 There is not a net revenue enhancement opportunity to be gained

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Patient Access Findings:

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 Financial Assistance Program

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Patient Access Findings:

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Charge Capture Findings:

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*Top 4 Payors account for 86%

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Outpatient & ER yields are 6

Total % of Charge, and

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Patient Access Recommendations:

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