As healthcare finance leaders converge in Orlando next week for the annual Healthcare Financial Management Association (HFMA) Annual Conference, this recent HealthLeaders article highlights how to find the hidden dollars in your hospital (without reducing labor).
Find the Hidden Dollars in Your Hospital
Healthcare Executives Survey Cites Cost Transformation Need as Revenue Cycle Management Improvement Has Jumped to Top Hospital Priority
A recent Kaufman Hall survey found that an overwhelming majority of healthcare executives (96 percent) stated that cost transformation is a significant need for their hospital or health system. Yet, over 50 percent of organizations surveyed either do not have a healthcare cost reduction goal or have such a small goal that it will not, in reality, transform their cost structures.
Revenue Cycle Management Expected to Grow 11% Annually
The medical sector has been undergoing a series of interminable changes over the last few years. In consequence, healthcare revenue cycle management (RCM) market is set to witness a marked growth because of the rising need for timely bill reimbursements and insurance claims. Increased complexity in the medical coding process has led to the necessity of RCM solutions that help reduce billing errors.
Hospitals are Reprioritizing Revenue Cycle Management Upgrades Above Other Initiatives
Almost three-quarters of struggling hospitals are re-prioritizing revenue cycle management over a number of other initiatives. A recent Black Book Market Research survey uncovered that hospitals leaders are pushing revenue cycle management to the top of their priority lists in this last quarter of 2017. The Black Book Research indicated that 74 percent of struggling hospitals are putting population health, analytics, physician practice acquisitions and recruitment, and patient engagement on the back burner to reprioritize revenue cycle management through Q4 2017.
Average Hospital Leaves $22 Million on the Table Due to Poor Revenue Cycle Performance
The Advisory Board Company in a press release earlier this year announced that the average 350-bed hospital has an overlooked opportunity of up to $22 million in revenue capture. Improving revenue cycle performance to decrease missed revenue opportunity means responding to four market forces.
Coding and Patient Financial Services – Working Together to Create a Healthy Revenue Stream
There are two key players in revenue cycle stream – the HIM coding department and the patient financial services department. Working together these two departments can sustain a healthy revenue cycle for any healthcare organization. These two departments are responsible for all of the basic elements of the revenue cycle -- from registration to coding the care provided to final discharge.
Patient financial services, typically, includes the registration process, and that is where the revenue stream has its head waters. An accurate registration process establishes the basis for future follow-up with payers or the patient as a self-payer.
Using their knowledge of billing rules, patient financial services applies the appropriate billing rules, such as Local Medical Review Policies (LMRPs) or National Coverage Determinations (NCDs) to produce an accurate patient bill.
The HIM coding department uses its vast knowledge of the very latest coding rules to provide patient financial services with an accurate medical record from which to produce their patient bill.
Secrets to Increasing Revenue through Claim Denials
In the world of medical services it is no secret that the revenue cycle can be severely interrupted if not completely stopped when a medical claim filed is denied. This break in the rev cycle has been under much scrutiny and close watch by medical officials and stakeholders, especially since the switch to ICD-10. There was nervousness over how dramatically claim denials would increase after the new codes were implemented – now this anxiety has been exchanged for determination to minimize the impact that denied claims can and will inevitably have on revenue.
One case study that stands out as a self-starter for taking initiative in this area is Orlando Health. With 6 acute Care Hospitals, 15,132 team members and 2,995 beds, Orlando Health was interested in investigating how to reduce their percentage of denied claims and maintain the industry benchmark between 2-4 percent. Their discovery after seeking advice from an outside consulting group left administrators concerned that they were heading for trouble, when told they already ranked above the national average and were losing millions of dollars in revenue every year.