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North Carolina HFMA Educational Webinar


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North Carolina HFMA Educational Webinar

  1. 1. Breakthrough StrategiesLeading Practice Self-Pay SolutionsPresented by: Phil C. SolomonNC HFMA Chapter – March 17, 2009 Proprietary and Confidential This information is not to be copied or otherwise utilized without the written consent of UCB, Inc.
  2. 2. Session OverviewBreakthrough Strategies Learning Objectives: Healthcare industry financial overview Review the economic factors causing the rise in self-pay Identify new tools, technologies and strategies to help you to address the increasing self-pay patient populationPage  2
  3. 3. Session OverviewBreakthrough Strategies “If you think you can….. or if you think you can’t….. youre right” ~ Henry FordPage  3
  4. 4. QuestionBreakthrough Strategies The new healthcare bill will eliminate all self-pay accounts? Chat TRUE or FALSE?Page  4
  5. 5. AnswerBreakthrough StrategiesExpect increase co-pays deductibles Premiums increases Patients look to reduce premiumsPage  5
  6. 6. Healthcare Industry OverviewBreakthrough Strategies 2009 U.S. $ 14.2 Trillion GDP Gross Domestic Product (GDP) consumption + investment + government spending + (exports – imports) U.S. Healthcare $2.7 Trillion UK Total GDP $2.67 TrillionPage  6
  7. 7. Healthcare Industry OverviewBreakthrough Strategies CMS Estimates by 2019…………Page  7
  8. 8. Healthcare Industry OverviewBreakthrough Strategies From 2006 to 2015 CMS estimates health spending growth will exceed 7.2% (three times faster than U.S. GDP)Page  8
  9. 9. Self-Pay DriversBreakthrough Strategies Sluggish economy creates loss of sales Economic Crisis Higher unemployment reduces taxes and High Unemployment premiums to insurance companies Government reduces subsidies-business’s Government Cuts reduced ability to offer health care coverage Government slows payments to Providers Payment Slowdown Increased premiums force patients to take Costly Insurance more risk – higher deductibles & co-pays Less available dollars and reduced borrowing Capital Tightening powerPage  9
  10. 10. Self-Pay FactorsBreakthrough Strategies Nationally, 17% of the population under 65 has insurance – North Carolina 18% (source U.S. Census Bureau) 25 million adults under age 65 were underinsured in 2008 (source Commonwealth Fund) Underinsured population increased over 60% from 2003 to 2009 Uninsured equals approximately 48 million Americans (source U.S. Census Bureau)Page  10
  11. 11. Self-Pay FactorsBreakthrough Strategies How large is 48 million……. All Americans age 65 and older (35.9 million) (source Center for American Progress)Page  11
  12. 12. North Carolina Self-Pay FactorsBreakthrough Strategies North CarolinaPage  12
  13. 13. North Carolina Self-Pay FactorsBreakthrough Strategies North CarolinaPage  13
  14. 14. North Carolina Self-Pay FactorsBreakthrough Strategies North CarolinaPage  14
  15. 15. North Carolina Self-Pay FactorsBreakthrough Strategies North CarolinaPage  15
  16. 16. Self-Pay FactorsBreakthrough Strategies Do More with LessPage  16
  17. 17. Self-Pay FactorsBreakthrough Strategies Distribution of Deductibles for Employee-Only PPO Coverage 48% Source: Kaiser Family Foundation and Health Research & Educational Trust, 2000-2008 Survey of Employer Health Benefits Report.Page  17
  18. 18. Self-Pay DilemmaBreakthrough Strategies 70% of Hospital Systems Report Increase in Uninsured Self-Pay Patients (source HFMA View Live Poll June 2009)Page  18
  19. 19. Self-Pay DilemmaBreakthrough Strategies The Good News: An The Healthcare Industry is Growing Uncertain FuturePage  19
  20. 20. QuestionBreakthrough Strategies What are the solutions…Page  20
  21. 21. QuestionBreakthrough Strategies What do we focus on first?Page  21
  22. 22. No Risk – No RewardBreakthrough Strategies Don’t be afraid to try something new Engage in pilot programs Seek new technologies Think “outside the box”Page  22
  23. 23. No Stop Gap Band-Aid SolutionsBreakthrough StrategiesPage  23
  24. 24. Registration ChallengesBreakthrough Strategies Registration input accuracy rate (National Average 30%) Incorrect insurance information entered at pre/registration Insurance eligibility and pre-cert not verified at pre/registration Costly to administer charity No collection at POS - Co-pays or deductibles Red Flag and acts of fraudPage  24
  25. 25. Registration Cause-EffectBreakthrough Strategies Missed Medicaid/Medicare/Commercial eligibility Denials Additional Rework Excess Bad Debt Missed Cobra 60 day rule Increase in A/R – Days Chat Other Registration Quality Effects?Page  25
  26. 26. Registration SolutionsBreakthrough Strategies Improve registration accuracy with real time demographic validation Enable POS collections by utilizing patient payment estimation tools Validate past due payment history with real time systems – Ask for money pre & POS Real time screen for charity – consumer behavior tools Real time technologies identify COBRA – unemployed Real time registration quality monitoringPage  26
  27. 27. Registration TrackingBreakthrough StrategiesPage  27
  28. 28. Eligibility Cascading WaterfallBreakthrough Strategies Real time eligibility check Flat fee pricing Waterfall cascade check: Medicare/Medicaid Commercial Commercial propensity Prime, second, tertiary Patient historical data Employer Other demographicsPage  28
  29. 29. POS CollectionBreakthrough Strategies Institute for Health Care Revenue Cycle Research - A Division of Zimmerman, LLC. National Pledge to Reform Uncompensated Care Reform Underway: Adopting Best Practices to Reduce Uncompensated Care and Improve the Patient Experience. a special supplement to PATIENT PAYMENT BLUEPRINT™Page  29
  30. 30. POS Collection ToolsBreakthrough StrategiesPage  30
  31. 31. POS Action StrategyBreakthrough Strategies Financial Assistance You may qualify for Medicaid? Let me help you You may qualify for our charity care program? Let me help you Patient Pay Will you be paying cash, check or credit card? Do you have a credit card on file with us? Let me show you how you can take advantage of our prompt payment and self-pay discount Let’s set you up on a payment plan………..Page  31
  32. 32. Self-Pay Processing ChallengesBreakthrough Strategies Hard to identify potential charity account Costly to process charity accounts Lack of participation by patient Issues in the ER Systems lacking to track patient payment history Where is the money? – Who can pay? Red FlagsPage  32
  33. 33. Self-Pay Cause-EffectBreakthrough Strategies Spend too much to give away free care Patient apathy – learned behavior Excessive mail returns Excessive Bad Debt Missed collection opportunity – vendors lacking latest tools Increase in A/R – Days Chat Other Self-Pay Effects?Page  33
  34. 34. Self-Pay Processing SolutionsBreakthrough Strategies Use Self-pay modeling solutions Automated charity screening Screen all self-pay at POS and BAI accounts Real time systems assess a patient’s financial situation Use Medicaid Wizard Questionnaire to determine eligibility Adherence to Red Flag Policy with CRAPage  34
  35. 35. Self-Pay Modeling ValidationBreakthrough Strategies Without Self-Pay Modeling Who should qualify for charity? Who will pay their bill?Page  35
  36. 36. Self-Pay Modeling ValidationBreakthrough Strategies With Modeling & Analytics Charity – High – Medium –their bill?– Unlikely– Need Data Who will pay Low Know how much they can payPage  36
  37. 37. Automated Charity ToolsBreakthrough Strategies WHY? Consistent fair evaluation Unbiased and defensible Tax-exempt - accurate classification and reporting of community benefit for IRS Form 990 Cost reduction strategy Scrutinize patients total financial profile Guard against charity fraud HFMA Statement 15 Section 3.7 supports credit validationPage  37
  38. 38. Charity ProcessingBreakthrough Strategies Consider this: “Manual Charity Processes = variable interpretations and applications of policy” Financial Financial Financial Financial Financial Financial Counselor Counselor Counselor Counselor Counselor CounselorPage  38
  39. 39. Charity ProcessingBreakthrough Strategies What does it cost to process a single charity application? Financial Financial Financial Financial Financial Financial Counselor Counselor Counselor Counselor Counselor Counselor ChatPage  39 The Answer Is?
  40. 40. Best Payment Likelihood ModelBreakthrough Strategies Customized Model Blending Patient Payment History Actual Patient Payment History & Patterns Similar Patient Profile History and Patterns Generic Propensity of Payment Model, Including: Credit Bureau Report Demographic Profile Non-Credit Lifestyle ProfilingPage  40
  41. 41. Segmented Collection StrategyBreakthrough StrategiesPage  41
  42. 42. Work Flow OptimizationBreakthrough Strategies Qualify & Process Maximum Resources Modified Work Flow Accelerate to Bad debt Skip Trace & ProcessPage  42
  43. 43. Red Flag QuestionBreakthrough Strategies What is a Red Flag Alert? Notification of a possible terrorist threat A continuous non paying patient A warning from the government An activity which indicates actual identity theft An activity indicating the possibility of identity theft ChatPage  43 The Answer Is?
  44. 44. AnswerBreakthrough Strategies A pattern, practice, or specific activity that indicates the possible existence of identity theftPage  44
  45. 45. What is a Red Flag?Breakthrough Strategies Red Flag Categories  Alerts, notifications or warnings from a CRA  Suspicious documents  Suspicious personal identifying information  Unusual use of, or suspicious activity relating to, the covered account  Notices from customer, victims of ID theft, law enforcement authorities, or other persons regarding possible ID theft in connection with covered accounts held by the organizationPage  45
  46. 46. Best Practice Self-Pay ModelingBreakthrough Strategies Patient Demographic Data Zip+4 Census Data Actual Collection Performance Validation Patient Payment History – Custom Model Financial Credit Bureau Data Non-Credit Economic Data Red Flag Alerts Skip Trace Data Validation Dual Validation Income Estimator Charity Lifestyle EvaluationPage  46
  47. 47. Other Collection SolutionsBreakthrough Strategies Recourse – Non-recourse funding Good or bad? Healthcare Credit Cards Personal lines of creditPage  47
  48. 48. Self-Pay Bad Debt ChallengesBreakthrough Strategies Cultural behavior and lack of control slows placement to agency Stigma about placement – conflict with mission Myth - must use multiple agencies to maximize performancePage  48
  49. 49. Self-Pay Bad Debt SolutionsBreakthrough Strategies With new processes, only “true” bad debt accounts get placed Know which accounts to write off sooner with modeling Analytics and segmentation minimizes the need for champion vs. challenger Minimize the need to work accounts too longPage  49
  50. 50. Self-Pay Bad Debt StrategiesBreakthrough Strategies Lowest scored accounts average 50% Reduce statement cost by accelerating placement Low scored accounts – accelerate to collection agency Treat each segment similarly, accounts can be reported on Medicare cost report sooner, leaving “collectable” accounts with agency longerPage  50
  51. 51. QuestionBreakthrough Strategies In order to meet Medicare cost reporting guidelines, you are required to work accounts internally for 120 days? Chat TRUE or FALSE?Page  51
  52. 52. Self-Pay Reporting ChallengesBreakthrough Strategies HIS lacks self-pay focused tools No real time collection statistics available No patient payment analytics readily available Limited address validation reporting Limited POS collection performance tracking tools availablePage  52
  53. 53. Self-Pay Reporting SolutionsBreakthrough Strategies New tools designed specifically for Self-Pay Provide instant feed back to internal staff Identify trends and act rapidly for cost containment Leverage dashboards to track performancePage  53
  54. 54. Performance Real Time DashboardBreakthrough Strategies Identify Measure AdjustPage  54
  55. 55. Overall BenefitsBreakthrough Strategies Collect 5% to 10% of total self-pay inventory at POS Reduce internal cost for government eligibility programs by 25% Reduce charity administration costs by over 80% Reclassify up to 20% of bad debt accounts as charity Reduce statement cost by 25%-70%Page  55
  56. 56. Overall BenefitsBreakthrough Strategies Reduce mail returns by over 40% Improve liquidation by 25% to 40% Add 10% to 15% in incremental revenue through eligibility cascade Accelerate Medicare cost reporting on bad debt segmented accounts – allowing collectable accounts to remain at agency longerPage  56
  57. 57. Do You Have Any Questions? Thank you Phil Solomon Chief Client Officer UCB, Inc. 404-849-8065 psolomon@ucbinc.comPage  57