Revenue Integrity Black Holes  A Former CBO Director’s Perspective  Rob Jones, MBA, CPAT Director of Revenue Integrity Jan...
Objectives <ul><li>Discuss some basics related to revenue integrity black holes </li></ul><ul><li>Discuss why black holes ...
Background? <ul><li>How many people come from Finance backgrounds?  </li></ul><ul><li>How many people come from Operations...
My Background / Perspective <ul><li>Representative, Medicare Billing (Hospital CBO)  </li></ul><ul><li>Supervisor, Account...
What is Revenue Integrity? <ul><li>Revenue integrity can be summarized as follows:  </li></ul><ul><li>“ properly capture a...
What is a Black Hole? <ul><li>A Black Hole is defined as follows:  </li></ul><ul><li>“ a region of space from which nothin...
What is a Revenue Integrity Black Hole? <ul><li>In healthcare Revenue Integrity, a Black Hole translates to:  </li></ul><u...
WHY DO BLACK HOLES EXIST?
Why Do Black Holes Exist? <ul><li>Let’s start with billing requirements:  </li></ul><ul><ul><li>Ultimately everything we d...
Why Do Black Holes Exist? <ul><li>Assuming the UB-04 claim in billed, did it correctly capture all the services performed ...
Why Do Black Holes Exist? <ul><li>Assuming you’ve done everything correct and billed a perfectly clean UB-04 that captures...
Why Do Black Holes Exist? <ul><li>Assuming everything is “perfect” on the UB-04 and the payers reimburse the correct amoun...
What’s The Bottom Line? <ul><li>“ You don’t know what you don’t know!” </li></ul><ul><li>No one person knows everything, t...
We Talked About People And Process,  But What About Technology? <ul><li>Let’s talk about technology….. </li></ul><ul><li>H...
Systems Don’t Solve Problems, People Do! <ul><li>Our reliance on computer technology is one of the major underlying reason...
Revenue Integrity: Discussion
Revenue Integrity: Discussion <ul><li>Is there a person in this room that believes their hospital(s) does not have a singl...
Revenue Integrity: Discussion <ul><li>Example #1  – After self pay collection efforts were exhausted, the accounts were no...
Revenue Integrity: Discussion <ul><li>Example #3   – The average assigned ER level was below the local and regional hospit...
Revenue Integrity: Discussion <ul><li>Example #4   – Assigned price is less than Medicare reimbursement.  Impact of new OP...
Revenue Integrity: Solutions <ul><li>Form a revenue integrity task force of seasoned and knowledgeable professionals in al...
Contact Information <ul><li>Rob Jones, MBA, CPAT  </li></ul><ul><li>Director of Revenue Recovery </li></ul><ul><li>IMA Con...
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Revenue Integrity Black Holes

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A former CBO Director\'s perspective on black holes, why they exist, and solutions

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Revenue Integrity Black Holes

  1. 1. Revenue Integrity Black Holes A Former CBO Director’s Perspective Rob Jones, MBA, CPAT Director of Revenue Integrity January 2011
  2. 2. Objectives <ul><li>Discuss some basics related to revenue integrity black holes </li></ul><ul><li>Discuss why black holes exist </li></ul><ul><li>Open forum discussion </li></ul><ul><li>Walk through some “real life” examples of black holes </li></ul><ul><li>Review solutions </li></ul>
  3. 3. Background? <ul><li>How many people come from Finance backgrounds? </li></ul><ul><li>How many people come from Operations backgrounds? </li></ul><ul><li>How many people have done both? </li></ul><ul><li>Of the business office or patient accounting people in the room today, how many of you started off as a biller? </li></ul>
  4. 4. My Background / Perspective <ul><li>Representative, Medicare Billing (Hospital CBO) </li></ul><ul><li>Supervisor, Account Maintenance (Physician CBO) </li></ul><ul><li>Manager, Cash & Budget (Hospital CBO) </li></ul><ul><li>Director, Patient Financial Services (Hospital & Physician CBO) </li></ul><ul><li>Vice President, Revenue Management (Hospital CBO) </li></ul><ul><li>Chair, Revenue Cycle Committee (various health systems) </li></ul><ul><li>Consultant, Revenue Integrity (IMA Consulting) </li></ul>
  5. 5. What is Revenue Integrity? <ul><li>Revenue integrity can be summarized as follows: </li></ul><ul><li>“ properly capture and correctly bill for services performed, maximize pricing opportunity, and ensure prompt accurate payment” </li></ul>
  6. 6. What is a Black Hole? <ul><li>A Black Hole is defined as follows: </li></ul><ul><li>“ a region of space from which nothing, not even light, can escape” </li></ul>
  7. 7. What is a Revenue Integrity Black Hole? <ul><li>In healthcare Revenue Integrity, a Black Hole translates to: </li></ul><ul><li>“ a system or process breakdown that prevents a hospital from getting paid accurately or timely” </li></ul>
  8. 8. WHY DO BLACK HOLES EXIST?
  9. 9. Why Do Black Holes Exist? <ul><li>Let’s start with billing requirements: </li></ul><ul><ul><li>Ultimately everything we do is summarized on a single form called the UB-04. </li></ul></ul><ul><ul><li>Who can tell me how many fields exist on a UB04? </li></ul></ul><ul><ul><li>Do payers have unique UB-04 data element requirements? </li></ul></ul><ul><ul><li>How many fields on the UB04 is the business office responsible for? </li></ul></ul>
  10. 10. Why Do Black Holes Exist? <ul><li>Assuming the UB-04 claim in billed, did it correctly capture all the services performed in field 44? </li></ul><ul><li>The critical link between service delivery and billing on the UB-04 is the charge description master (CDM), which is basically the price book for the hospital. </li></ul><ul><ul><li>Are all the services or supplies currently listed in the CDM? </li></ul></ul><ul><ul><li>Is the pricing relative to APC / other fee schedule reimbursement low? </li></ul></ul><ul><ul><li>How often are CDM service codes / procedures with no assigned prices reviewed to ensure any internal manual pricing policies are compliant? </li></ul></ul><ul><ul><li>How many people have “software” or “systems” that are supposed to take care of all this? </li></ul></ul>
  11. 11. Why Do Black Holes Exist? <ul><li>Assuming you’ve done everything correct and billed a perfectly clean UB-04 that captures all the services performed, are there processes and key performance indicators (KPI’s) in place to accurately record transactions and manage exceptions? </li></ul><ul><li>When is the claim adjusted? </li></ul><ul><li>Is it Systematic or Manual? If systematic, who is programming the contract management system? </li></ul><ul><li>Are transaction codes applied electronically or manually? </li></ul><ul><li>How are payment variances tracked and investigated? </li></ul>
  12. 12. Why Do Black Holes Exist? <ul><li>Assuming everything is “perfect” on the UB-04 and the payers reimburse the correct amount, could there still be a black hole with revenue opportunity? YES! </li></ul><ul><li>Are the managed care contracts reviewed by a business office professional? </li></ul><ul><li>Is there an opportunity to unbundle certain services from and inpatient claim for additional reimbursement? </li></ul><ul><li>Is there a strategic pricing opportunity based on contract terms? </li></ul><ul><li>How are supply items reimbursed? What about supply expenses? Are you losing money due to supply costs? </li></ul><ul><li>Are zero balances reviewed regularly for underpayment opportunity? </li></ul>
  13. 13. What’s The Bottom Line? <ul><li>“ You don’t know what you don’t know!” </li></ul><ul><li>No one person knows everything, the healthcare landscape is simply too complex. </li></ul><ul><li>Ensuring revenue integrity requires “subject matter expertise” in patient access, case management, charge capture, charge description master, coding, compliance, patient financial services, managed care, reimbursement, and finance. </li></ul><ul><li>Coordination between all of these subject matter experts is essential to billing a clean claim with all the appropriate charges. </li></ul>
  14. 14. We Talked About People And Process, But What About Technology? <ul><li>Let’s talk about technology….. </li></ul><ul><li>Hospitals rely on information systems to link the revenue cycle departments and electronically push information flow from department to department. </li></ul><ul><li>Information systems are not perfect and often have limitations. Additionally, these systems are only as good as the people who program them. </li></ul><ul><li>Are your processes built around systems, or are systems built around your processes? </li></ul><ul><li>Do you rely too heavily on technology? </li></ul>Does an imbalance exist in your organization?
  15. 15. Systems Don’t Solve Problems, People Do! <ul><li>Our reliance on computer technology is one of the major underlying reasons why black holes exist. </li></ul><ul><li>Over the last decade we have focused more on technology with a diminishing need for people. </li></ul><ul><li>Computer automation has given us a false sense of security. </li></ul><ul><li>Personal interaction has decreased. </li></ul><ul><li>What about critical thinking or deductive reasoning? </li></ul>
  16. 16. Revenue Integrity: Discussion
  17. 17. Revenue Integrity: Discussion <ul><li>Is there a person in this room that believes their hospital(s) does not have a single black hole? </li></ul><ul><li>If you had the choice to hire more people or implement a new computer system, what would you choose? </li></ul><ul><li>How has technology impacted our critical thinking ability and deductive reasoning skills? </li></ul><ul><li>Does anyone have an example of a black hole that you personally experienced? </li></ul>
  18. 18. Revenue Integrity: Discussion <ul><li>Example #1 – After self pay collection efforts were exhausted, the accounts were not transferred or adjusted to bad debt </li></ul><ul><li>Black Hole Financial Impact: </li></ul><ul><ul><li>Medicare bad debt was not claimed </li></ul></ul><ul><ul><li>Bad debt reserves were understated </li></ul></ul><ul><li>Example #2 – Secondary balances were not getting transferred after the primary insurance company paid </li></ul><ul><li>Black Hole Financial Impact: </li></ul><ul><ul><li>Decreased collections </li></ul></ul><ul><ul><li>Increased bad debt via reserve provision </li></ul></ul>
  19. 19. Revenue Integrity: Discussion <ul><li>Example #3 – The average assigned ER level was below the local and regional hospital average </li></ul><ul><li>Black Hole Financial Impact: </li></ul><ul><ul><li>An opportunity to assign a higher ER level exists </li></ul></ul><ul><ul><li>Charge capture opportunity additionally identified </li></ul></ul>
  20. 20. Revenue Integrity: Discussion <ul><li>Example #4 – Assigned price is less than Medicare reimbursement. Impact of new OPPS coding requirements on reimbursement? </li></ul><ul><li>Black Hole Financial Impact: </li></ul><ul><ul><li>Lost revenue </li></ul></ul><ul><li>Example #5 – Supply item cost exceeds actual case rate reimbursement. In some cases which require an invoice for reimbursement, nothing is sent. </li></ul><ul><li>Black Hole Financial Impact: </li></ul><ul><ul><li>Lost revenue </li></ul></ul>
  21. 21. Revenue Integrity: Solutions <ul><li>Form a revenue integrity task force of seasoned and knowledgeable professionals in all areas of revenue cycle is the single most important critical success factor </li></ul><ul><li>Assess current state to identify areas of weakness and create monitoring tools or KPI’s to monitor performance </li></ul><ul><li>Cross train “intelligent” resources </li></ul><ul><li>Do not solely rely on systems, instead build systems to support your processes </li></ul>
  22. 22. Contact Information <ul><li>Rob Jones, MBA, CPAT </li></ul><ul><li>Director of Revenue Recovery </li></ul><ul><li>IMA Consulting </li></ul><ul><li>3 Christy Drive </li></ul><ul><li>Chadds Ford, PA 19317 </li></ul><ul><li>(484) 840-1984 (office) </li></ul><ul><li>(484) 431-4324 (cell) </li></ul><ul><li>[email_address] </li></ul><ul><li>www.ima-consulting.com </li></ul>

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