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Improving Outpatient Charge Capture 1014 HFM Reprint Gautschi

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Improving Outpatient Charge Capture 1014 HFM Reprint Gautschi

  1. 1. REPRINT  October 2014 healthcare financial management association hfma.org Revenue cycle Daniel Gautschi Brian Sanderson AT A GLANCE > Hospitalscanidentifyopportunitiestoenhance revenuecollectionbycloselyanalyzingoutpatient charge-capturedata. > Ahospitalcanbolsteritscharge-captureanalysisby performingacharge-captureprocesswalk-through andscrutinizingsubsystemlinks,third-partypayer contracts,andelectronichealthrecordstructures. > Thehospitalthencanintegratecharge-integrity functionsintoclinicaldepartmentsasneededby developingcharge-reconciliationtoolsandreports andmonitoringtheirutilization,andincorporating charge-reconciliationresponsibilitiesintoclinical departmentmanagers’jobdescriptionsandgoals. Healthcare reform, an unstable economy, and other factors have increasedrevenuepressureonhospitalsacrossthenation.Perhapsthemost promisingopportunitytoenhancerevenueisthroughimprovementofoutpatient chargecapture. Outpatientchargecapturegenerallypresentsanumberofopportunities— moresothanontheinpatientside—tofixprocessesquicklyandprotectrevenue integrity.Hospitalsroutinelycollectvastamountsofpatientandfinancialdata relatedtochargecapture,andcanusethesedataalongwithadditionalanalysisto pinpointopportunitiesforimprovementandeffectivelyallocatescarceresources astheyseektooptimizerevenue. Limitations of Common Charge-Capture Analytics Improvementsintechnologyhaveallowedhospitalstogatheratremendous amountofdataaspartoftheirdailyoperations,includinginformationthatcanshed valuablelightonwheretheymightbestrugglingtocapturecharges.Thesedata resideprimarilyinthebillingandaccountsreceivable(A/R)system,thepatient clinicalinformationsystem,andsubsystemssuchastheradiology,pharmacy,and laboratoryinformationsystems.Dataalsocomefromexistingcharge-capture softwaretoolsthatferretoutmissingcharges. Historically,however,hospitalshavenotprovedtobeadeptatminingsuch information.Theyhavelackedthetoolsandexpertisetopullrelevantdata,convert thedatatoanaccessibleformathighlightingthemostusefulinformation,and generallysupportthecharge-integrityfunction. Thecharge-integrityfunctiontypicallyfocusesonseveralcommonanalytics. Chargemasterassessments.Althoughmaintenanceofthechargemasteriscritical, itmaybeoflittlehelpinuncoveringissuesrelatedtochargecaptureandhowa improving outpatient charge capture hfma.org  October 2014  1
  2. 2. Revenue cycle departmentactuallyappliesthecharges.Ahospital canhavethecleanest,mostcomprehensivecharge- master,butifthecharge-capturemethodsforagiven servicearenotcleartodepartmentstaff,thehospital couldstillloserevenueforthepatientservicesit provides. Patient-accountassessments.Theseassessments generallyconcentrateontheaccuracyof CPTand HCPCScodesforchargedservices,buttheyare ineffectiveforidentifyingchargesthatmightbe missing.Forexample,ifserviceswereperformedbut notdocumentedinapatient’smedicalrecord,the personconductingapatient-accountassessmenthas nowayofknowingthattheserviceshavebeen deliveredandthecorrespondingchargesaremissing. Late-chargeassessments.Manyhospitalsassesslate chargestodeterminewhetheranydepartments mightbetardyinsubmittingcharges,andifso,towhat extent.Late-chargereportsareagoodindicatorof thetiminginthechargeentryprocessbutnotof wherespecificopportunitiestoimprovecharge capturemightlie.Forexample,thelate-charge reportindicatestheefficiencyoftheemergency department(ED)inenteringchargesbutnotwhether the EDcapturedachargeforeachpatientseenin thedepartment. Revenueandusagestatistics.Mosthospitalsprovide eachdepartmentdirectorwithamonthlyrevenue andusagereportthatshowsallthechargesavailable foreachdepartment,howofteneachchargewas used,andthegrossrevenueforeachcharge.These reportsareimportantforcheckinggeneralaccuracy andhelpingdepartmentleadersunderstandcharge activity,buttheyarealimitedaidforrecognizing missingcharges.Adepartmentdirectorcansee whethergrosschargesareconsistentwithhistorical levelsbutwillhaveahardtimediagnosingparticular charge-captureissueswithoutspecificreport customizationandadditionaltraining.Department managersanddirectorstypicallyaretrainedto providepatientcare,nottoanalyzedatafroma lost-chargeperspective. Departmental charge reconciliation. Every hospital department should perform daily, weekly, or monthly reconciliations of its activity against its charges. But this exercise, while vital, might not identify additional lost charges; it flags that a certain patient received a service and some charges were captured, but it does not confirm the accuracy and comprehensiveness of the charges. To get the full picture, the department director must use a combination of basic charge reconciliation (e.g., 100 patients seen and 100 charges entered) and customized reporting that allows more detailed drill-downs into the charges captured by depart- ment staff. Focusing Charge-Integrity Resources Misaligned staff is a potential charge-capture issue for hospitals of all sizes. Larger hospitals and academic institutions might have charge-integrity staff members located in separate pods or silos across revenue-producing departments that have their own staffs, tools, and processes. Many community hospitals lack formal charge-integrity functions altogether, leading to a haphazard approach. All hospitals can benefit from scrutinizing their charge-integrity functions and aligning resources appropriately. To improve outpatient charge capture, a hospital should direct charge-integrity resources toward efforts that are most likely to return revenue instead of those that are more maintenance-oriented. Hospitalsalreadypossessdatathatcansupport severaltypesofworthwhilecharge-captureanalytics. Specifically,ahospitalshouldconsiderperforming thefollowingfourassessments. Charge-captureprocesswalk-through.Thecharge- integrityteamshouldhaveclinicalstafftaketheteam stepbystepfromservicedeliverytochargeentry. Understandingclinicalprotocolsandclinicalservices deliveredandtranslatingthatinformationintocharge captureisessential. Inthecaseofanoutpatientinfusiondepartment,for example,learningaboutthemajortypesofinfusions performedandclinicalprotocolsfollowed(e.g.,the lengthoftheinfusion,anyadditionalinjectionsgiven, 2  October 2014  healthcare financial management
  3. 3. Revenue cycle typesofdrugsadministered)wouldprovidethe charge-integrityteamwithvaluableinsight.Withany department,theteamshouldstartbyinterviewing clinicalstaffanddirectlyobservingthecharge- capturemethodologiesandtoolsusedineachstep oftheprocess. The team also should compare the services provided by department staff with the chargemaster and charge-capture system to verify that all the necessary charges are available for capturing, and compare the department’s volume and revenue statistics with the clinical-service protocols to determine whether the associated charges are reasonable and accurate. Subsystemlinkageanalysis.Validationofthelinks betweenacharge-capturesubsystemandthe chargemastercanidentifymajorcharge-capture opportunities.TestingbyITtendstobeinsufficiently accuratetoassesschargecapture,insteadvalidating onlythegeneralfunctioningofthesystem(i.e., passingchargesfrompointAtopoint B). To precisely analyze the accuracy of charge links, the charge-integrity team first should have IT generate a report that identifies the specific department subsystem line items (e.g., in the radiology information system) and the correspond- ing charge line item (or items) to which they link in the chargemaster. Theteamthenshouldanalyzethereporttoidentify anyclearlymismatchedlineitems(e.g.,achest two-viewX-raymappedtothechargeforacomputed tomographyscanoftheabdomen),reviewany mismatchedlineitemswiththeclinicaldepartment staff,andanalyzebillingsamplesformismatched itemstovalidatethefindings. Third-partypayercontractanalysis.Understanding howcharge-captureprocessesmatchuptothe specificsofpaymenttermsincontractsiscriticaland canproducesignificantnetrevenueresults. Charge-integritystaffshouldobtainpaymentterms forthehospital’stopfivenongovernmentalpayers andidentifyinstancesinwhichspecificrequirements arenecessaryforthehospitaltoreceivethe appropriatepayment.Theseinstancesmayinclude carve-outprovisionsthatrequiretheuseofcertain revenuecodestoreceivepaymentforparticular charges(e.g.,usingaspecificrevenuecodefor implantsupplies)andlesser-of-fee-schedule-or-charge provisions,accordingtowhichpaymentisthelesser ofthehospital’schargeorthespecifiedpayment onafeeschedule. Thecharge-integritystaffthenshouldcomparethe specificprovisionstothehospital’schargemaster andverifythattherequiredrevenuecodesarebeing usedandthatpricesareabovefeescheduleamounts. Theteamalsoshouldanalyzeabillingsamplefor suspectedissuesandvalidatepaymentdiscrepancies byreviewingthespecificpayer’sremittanceadvice forthechargesinquestion. Electronichealthrecord(EHR)structureanalysis. Manyhospitalsandhealthsystemshaveimplemented EHRswiththeexpectationthattheywillimprove chargecapture,onlytofindthattheoppositeis happening. Chargecapturemightdeteriorateafter EHRimplementationbecauseofthe EHR’slackof automatedcharge-capturefunctionalityorclinical staff’sconfusionabouthowtodocumentthe requiredinformationtosupportcodingand chargingprocesses. Identifyingcharge-captureissueswithinthe EHRis criticalforstoppingrevenueleakage.Thecharge- integrityteamshouldbeanintegralpartofthe EHR selectionprocesstohelpquicklyidentifypotential charge-capturedeficiencies.Oncesuchissuesare identified,theycanbeeitherrectifiedwiththevendor ormorefullyunderstoodwithaneyetoward enhancingtrainingofclinicaldepartmentstaffon howtousethenewsystemeffectively. Integration of Charge Integrity in   Clinical Departments Thetoolsandprocessescreatedaspartofahospital’s charge-integrityfunctionshouldbeformally incorporatedintotheregularcharge-reconciliation processesofclinicaldepartments,thereby empoweringdepartmentstoactoncharge capture.Toaccomplishthisgoal,hospitalscan takeafour-stepapproach. hfma.org  October 2014  3
  4. 4. Revenue cycle ReprintedfromtheOctober2014issueofhfmmagazine. Copyright2014byHealthcareFinancialManagementAssociation, ThreeWestbrook Corporate Center,Suite600,Westchester,IL60154-5732.Formoreinformation,call800-252-HFMAorvisithfma.org. Developcharge-reconciliationtoolsandreports. Valuablecustomreportscanbecreatedfromthe followingdatasets: > Departmentalclinicalsystems,whichcontain informationonthenumberofpatientsseenina particulartimeframe > Centralschedulingsystems,whichindicatehow manypatientsshouldhavereportedtothe departmentforservices > Revenueandusagestatistics,whichprovide essentialrawdataonthedepartment’sactual useofitscharges > Claimsdata(specifically ElectronicRemittance Advice[i.e.,835]filesthatdetailtheitemsfor whichpayerscompensatethehospital),whichcan provideawealthofinformationrelatedtoaccurate chargecapture Traineachdepartmentonusingthenewtoolsand reportsandonitsanalysisresponsibilities.Thisstep shouldinvolve,forexample: > Conductingtrainingsessionswithdepartment managersonhowtoanalyzethedatainthenew reports > Creatingclearactionstepsfordepartment managersandestablishingdeadlinesforanalyzing thedata > Teachingdepartmentmanagerstoidentifythecore issuesthatneedtobeaddressedregardingcharge captureandthestepsthedepartmentshouldtaketo remedytheissues Formallymonitoreachdepartment’scompliance. Thehospitalshouldestablishanautomatedreport distributionsystem(viae-mailorintranet)totrack eachdepartment’sreviewofthereports.Astandard meetingscheduleshouldbesetthatallowscharge- integritystafftoregularlydiscusseachdepartment’s resultsandobservations. Incorporatecharge-reconciliationresponsibilitiesinto clinicaldepartmentmanagers’jobdescriptionsand goals.Specificworktasksrelatedtocharge-capture monitoring(e.g.,workstepsandfrequency)shouldbe addedtodepartmentmanagers’annualplansto createahigherlevelofaccountability. The Rewards of Data-Driven Change Ahospital’schargedataisvaluablenotonlytothe charge-captureprocess,butalsoinsupportof projectssuchasICD-10preparation.Infact, charge-capturedatashouldbeinterwovenwith ICD-10implementation.Forexample,datacollected inthebillingandA/Rsystemcanbewieldedto determinethefrequencyofchargeactivity,whichin turnidentifiestheareasmostlikelytoencounter additionalICD-10issues. Everyhospitalhasauniverseofoutpatientcharge- capturedatajustwaitingtobetapped.Makingsense ofittoimproveperformanceischallenging,butthe challengeisnotinsurmountable.Hospitalsshould focusresourceswisely,takeadvantageofavailable technology,andconcentrateonthebasicstoeffect realchangeandboostrevenues.  DanielGautschi,MHA,isseniormanager, CroweHorwath LLP,Pittsburgh,andamemberofHFMA’sWestern Pennsylvania Chapter(daniel.gautschi@crowehorwath.com). BrianSandersonismanagingpartnerofhealthcareservices, CroweHorwathLLP,Oak Brook,Ill.,andamemberofHFMA’s FirstIllinois Chapter(brian.sanderson@crowehorwath.com). Assessing Charge-Integrity Performance Howdoesahospitalevaluatetheperformanceofthecharge-integrity function?Metricsshouldcoverthefollowingareas. Revenue improvement Identifylostchargesforpatientservices. Closeprocessgapsthatcauserevenueleaks. Protectexistingrevenue. Operational improvement Leadclinicaldepartments’charge-capturemonitoringprocesses. Createtoolsandreportsfromdatatoassisttheorganizationandeach departmentinmanagingrevenuerisk. Integratechargeintegrityintoallphasesoftherevenuecycle. Special projects Providesupportfornewservices. ProvideelectronichealthrecordandICD-10support. Resolvebillingandsubsystemissues. Managethird-partyandconsultingprojects.

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