Health systems are constantly striving for operational improvements as cost reductions and an increase in self-pay patients pressure their finances. As a result, revenue cycle management leaders face a number of challenges, including claim denials, cost to collect and price transparency.
Becker's Hospital Review asked revenue cycle and financial leaders at four health systems about their RCM goals for this year and how they plan to reach them.
SCL Health
Troy Spring, vice president of revenue services at Broomfield, Colo.-based SCL Health, a 12-hospital system with sites across Kansas, Colorado and Montana, cited preventing initial claim denials as the health system's top revenue cycle goal for 2017. He says this involves developing processes to prevent these denials and ensuring payers receive clean claims.
"If we get claims out the door cleanly, and they're then reviewed and accurate, that certainly reduces initial denials," says Mr. Spring. He added when claims are denied, they must be reworked, which is expensive and virtually delays getting the cash in the door.
"It has a patient impact, too, because the patient is not going to get their statement for their portion of the bill either," he says.
To prevent claim denials, SCL Health's billing office is using a multidisciplinary approach that joins clinical workers, care managers and patient access staff. He says the approach allows denials to be analyzed "in a real-time fashion to say, 'Why do these claims get denied'" and involves a "root cause analysis to say, 'What can we do differently that would prevent a claim from being denied upfront.'" He says SCL Health has also had preliminary strategic conversations about the issue with Oakland, Calif.-based Kaiser Permanente's health plan unit, although the conversations are in their early phases.
SCL Health also seeks to reduce final denials. Historically, the health system has tried to satisfy these claims, but attempts have fallen short, according to Mr. Spring. As a result, the organization wrote off those accounts. All of this, Mr. Spring notes, financially affects the health system.
"We try to make the initial denial funnel smaller so that the ending point with final denials is small, but making sure we've got good rigor around our process [is the goal]. You hate to chase something that has no life in it, but you also don't want to give up too quickly. Trying to find the sweet spot of when the denied claim is still viable and finding new and creative ways to pursue it" is the goal, he says.
Additionally, SCL Health aims to make pricing transparency improvements, as the popularity of high-deductible health plans grows and patients become even more interested in prices prior to receiving care. The health system currently uses a product from vendor TransUnion, called ClearIQ, to help provide patients with price estimates. The system is also in the midst of upgrading to a new version of Epic, which will include a module allowing patients to shop for prices via a patient portal. Mr. Spring expects that initiative to take effect in 2018.
"I'm hoping that will help bridge the gap and help us achieve transparency. We're passionate about trying to make the experience better for our patients, but [we're] struggling with some of the complexities of how medical billing works," he adds.
Baylor Scott & White Health
Dallas-based Baylor Scott & White Health, which includes nearly 50 hospitals and more than 1,000 patient care sites, has various revenue cycle goals, including improving the overall revenue cycle patient experience, says Sarah Knodel, system vice president of revenue cycle. The health system also aims to improve pricing transparency to ensure patients understand of their out-of-pocket costs and available options to pay those costs prior to service, at the time of service or post-discharge. In addition to those goals, Baylor Scott &White aims to reduce the cost to collect.
"At a time when margins are shrinking and everyone's being asked to do more with less, I think it's critical as a revenue cycle that we're as efficient as possible at delivering the most value to the organization at the lowest cost," says Ms. Knodel.
To enhance pricing transparency, the health system rolled out a self-service automated price estimation tool approximately one year ago. Patients can use the tool through the organization's website and mobile app to enter basic demographic and insurance information, select the service they are coming in for and receive a real-time estimate of out-of-pocket costs, according to Ms. Knodel. The tool includes contracted rates, pricing data and returns real-time eligibility and benefit data. Ms. Knodel says Baylor Scott & White is working on enhancements to the tool which currently only provides hospital pricing information. Within the next three to six months, she estimates physician charges will be added to the tool to provide patients with a more complete understanding of the cost of their care. She says the organization also believes the tool should ultimately include quality data.
"When we think about pricing transparency, it's a combination of both cost and quality that really enables a person to understand the value of what they're getting and to make an informed decision about where to receive care," she says. Additionally, Baylor Scott & White launched an interest-free patient loan program that patients can sign up for at the time of service or post-discharge. Ms. Knodel says this is one more option for patients to satisfy outstanding balances.
To reduce the cost to collect, the health system continues to focus on automation of core revenue cycle processes, such as insurance verification and insurance collections, says Ms. Knodel. The health system implemented claim status technology that uses screen scraping tools to automatically reveal statuses of insurance claims from payer websites. She notes this decreases the number of phone calls the hospital makes to insurance companies and the number of individual payer websites collectors must sign into. Through the technology, claim statuses are automatically transferred into the organization's collection work driver, she says. The driver then issues a unique action off of the status, "resulting in an exception-based workflow where only accounts truly requiring follow up get populated to a worklist for review," she adds. Baylor Scott & White is also considering machine-based learning in targeted areas to automate certain revenue cycle processes.
"I think a lot of vendors are investing in development in this space, but I don't know that anyone has perfected it. It's still a fairly new technology as it relates to revenue cycle processes, but I would anticipate in the next couple of years it will be the next big thing that really enables us to make big leaps in reducing our cost to collect. So much of what we do is transactional in nature, which means there is ample opportunity for automation," Ms. Knodel says.
ProMedica
At Toledo, Ohio-based ProMedica, which offers healthcare services to nearly 30 counties in northwest Ohio and southeast Michigan, all revenue cycle goals lead to the health system's primary goal of increasing cash collections, CFO Michael Browning said.
"With lower reimbursement, higher-deductible health plans and more pressures from insurance companies, improving our revenue realization and subsequent cash collections has become more challenging," he added. "These challenges have forced us to improve processes and become more innovative in how we manage the revenue cycle."
To achieve this goal, he said the health system must ensure revenue cycle and operations teams have the proper talent, education and tools "to maximize the benefit from the revenue cycle." In today's healthcare environment, he said most of ProMedica's positions require people to be knowledgeable, but also require they have excellent interpersonal skills, good analytical abilities and are able to multitask regularly.
"Finding this type of talent can be difficult. It requires us to be more competitive on compensation and offer an environment where our team can grow professionally. Once we identify the right talent, we have to provide them continuous education so that they can stay current with the changing healthcare environment. We are initiating a training/quality team in revenue cycle. This is not a new concept, but is essential to ensure our team is properly prepared," Mr. Browning said.
Mr. Browning said the health system must provide staff with "the right tools to perform their job." He specifically pointed to Epic, which ProMedica recently installed to help manage the organization's revenue cycle.
"The challenge with this new tool is that in order to have a 'good install' you must maintain some of your old processes during Epic go-live. This approach does not allow us to be innovative and push ourselves to fully utilize the new tool," he said. Once ProMedica completes the final go-live, he said the organization will begin optimizing the new tool.
Overall, "no matter whether you work at a small rural nonprofit hospital, a faith-based health system or a for-profit health system, we all understand the importance of improving our cash," Mr. Browning concluded. "Each year we may modify our strategy and we will likely change our initiatives, but one thing that will likely not change is our overarching goal of improving cash."
Orlando Health
As federal and state governments, insurance companies and employers seek to reduce healthcare costs, Orlando (Fla.) Health must make sure the organization's revenue cycle processes "are efficient and effective in accurately capturing charges, ensuring proper physician documentation and following up with insurance companies in a timely manner," CFO Bernadette Spong said.
Orlando Health, which serves nearly 2 million Central Florida residents and more than 4,500 international patients each year, has addressed this is by recruiting seasoned revenue cycle leaders. The health system is also examining vendor relationships and focusing on customer service, Ms. Spong said.
"Most times we are the last touchpoint with our patients and customers and want to ensure their encounter with us is as excellent as it can be," she added.
Orlando Health has focused on more transparency in its revenue cycle processes for operational leaders. For instance, Ms. Spong said the health system's revenue cycle office provides daily reports and engages with the operational teams to gain more knowledge on the connection between reimbursement and patient care.
Additionally, the health system is working with a national consulting firm specializing in revenue cycle improvement, and redesigning case management function "to better marry their work with revenue cycle."