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Association of Illinois Access Management

Patient Access No Bed of Roses

Rosewood Restaurant, Rosemont, IL

MAP KEYS – OVERVIEW

and CASE STUDY Thursday, March 10, 2011- 2 to 3:30 pm

Suzanne K. Lestina, FHFMA, CPC

Director, Revenue Cycle MAP

Healthcare Financial Management Association

Tracey McKnight, Senior Director, Revenue Cycle

Ami Kihn, Senior Director, Patient Financial

Operations

Spectrum Health System, Michigan

OVERVIEW

Reform and the revenue cycle

How hospitals are responding

Evidence-based improvement

A Case Study – Spectrum Health System

2

REFORM AND THE REVENUE CYCLE

INCREASING INSURANCE

COVERAGE

0

2

4

6

8

10

12

14

16

18

20

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

4

Am

erica

ns (M

illio

ns)

Source: CBO

CHANGING PAYER MIX

5

(32)

(5) (3)

16

24

(35)

(20)

(5)

10

25

Uninsured Non-GroupMarket

EmployerSponsored

Medicaid Exchanges

Am

erica

ns (M

illio

ns)

Source: CBO letter to House Speaker Nancy Pelosi

– March 20, 2010

FINANCIAL IMPACT ON

YOUR HOSPITALS

6

Sources: Health Care Facilities Managed Care Analysis; Bank of America Merrill Lynch;

March 4, 2010; p. 9

CBO letter to Speaker Nancy Pelosi; March 20, 2010; HFMA estimate

New payments for uncompensated care

Market basket update (MBU)

Disproportionate Share Hospital payment cuts

(Medicare & Medicaid DSH)

Reduced readmissions

Hospital-acquired conditions

Accountable care organizations

Net aggregate financial impact on U.S. hospitals

-36.1

-7.1

-1.5

-1.5

17.06

Payment reductions:

Payment Area Payment Reduction Over a

10 Year Period (in billions)

-112.6

177.3

OTHER REFORM CHANGES

New requirements

– Standardized charge reporting

– Requirements for tax-exempt hospitals

New economic incentives

– Payment linked to quality

– Accountable care organizations

– Bundled payment

7

HOW REFORM IS AFFECTING

THE REVENUE CYCLE R

evenue C

ycle

Im

pera

tives

8

Expanded

Coverage

New

Requirements

Payment

Cuts

New Economic

Incentives

Improve Performance and Efficiency

Eligibility

Processes

Charity Care

Policies/Process

Denials

Prevention ICD-10

Rational

Pricing

Documentation

and Coding

Physician

Integration

Bundled

Payments

HOW HOSPITALS ARE RESPONDING

PRINCETON BAPTIST MEDICAL CENTER BIRMINGHAM, ALABAMA

Consolidated pre-arrival unit

Automated insurance verification, including

identifying patient financial obligation

Communicating about and collecting this

amount prior to arrival

Instituting continuous quality improvement

process to identify and reduce errors

10

Area of Excellence: Cash Collection How They Did It

Reduce DNFB to 3.7 days

Increase cash as a % of net revenue to consistently

above 100%

Decrease denials to less than .25% of gross

revenue

Maintain cost to collect at less than 3%

11

DNFB Comparable Statistics

6.2 Median

5.4 Top Quartile Performance

Source: HFMA’s March 2010

Results

PRINCETON BAPTIST MEDICAL CENTER BIRMINGHAM, ALABAMA

TOUCHETTE REGIONAL HOSPITAL CENTREVILLE, ILLINOIS

Revising charity care policy

Adopting an automated patient

eligibility system

Incorporating charity care criteria

into the system’s database

12

Area of Excellence: Cash Collections How They Did It

TOUCHETTE REGIONAL HOSPITAL CENTREVILLE, ILLINOIS

Reduced bad debt charges by 48.6%

Increased charity care by 15.5%

Decreased overall uncompensated charges by 16.6%

Increased cash collections by $2.5 million over the goal

of102% adjusted net patient services revenue

13

Cash Collections Comparable Statistics

100.2 Median

102.1 Top Quartile Performance

Source: HFMA’s March 2010

Results

BAYLOR HEALTH CARE SYSTEM DALLAS, TEXAS

Centralize the business office

Centralize insurance verification

and pre-registration

Centralize denials management

14

Area of Excellence: Cash Position How They Did It

BAYLOR HEALTH CARE SYSTEM DALLAS, TEXAS

Improvements from 2000-2009

– Achieved consistent net revenue cash

collection rate of 100% or better

– Lowered net accounts receivable

days from 67.9 in 2000 to 39.9

– Decreased 91+ days from

discharge aging from 13.0% to 5.8%

– Reduced cost of collections

from 2.5%

15

Results

Source: HFMA’s March 2010

Days in A/R Comparable Statistics

44.5 Median

37.9 Top Quartile Performance

EVIDENCE-BASED IMPROVEMENT

EVIDENCE-BASED

IMPROVEMENT

Measuring Performance

– What are consensus measures of

revenue cycle excellence?

Comparing Performance

– How are peers performance and what

are performance targets?

Improving Performance

– How do high performers succeed?

17

Components

Identify and manage to trends

Validate best practices

Trigger corrective action

Forecast performance

Identify opportunities for process improvement

Compare performance with like organizations

Use data to change behaviors

18

Benefits

EVIDENCE-BASED

IMPROVEMENT

HFMA INITIATIVE

19

MAP is a comprehensive performance

improvement strategy

WHAT IS MAP?

Identify indicators

Track and improve performance

Recognize excellence

Share successful practices

20

EVIDENCE-BASED IMPROVEMENT:

MEASURING PERFORMANCE

MAP Keys are industry-developed

key indicators for revenue cycle

performance

MAP KEYS

Clearly defined

Measurable

Discerning

Comparable

MAP KEYS

Patient access

Revenue integrity

Claims adjudication

Management

23

MAP Keys focus on key areas of

revenue cycle performance

PURPOSE | VALUE | CALCULATION

24

Example

Indicator

Purpose

Value

Calculation

Net days in A/R

Trending indicator of overall A/R performance

Indicates revenue cycle efficiency

Net A/R

Net patient service revenue

EVIDENCE BASED IMPROVEMENT:

COMPARING PERFORMANCE

COMPARING PERFORMANCE

Manage trends

Identify opportunities

Prioritize opportunities

Identify successful practices

26

Industry trends

Performance over multiple

time frames

Pre-selected peer groups

Customized peer groups

COMPARING PERFORMANCE

27

Flexible comparisons are needed for

in-depth analysis

Source: HFMA’s

Bad Debt vs. Charity Care as of % Revenue

Jan 09 Mar 09 May 09 Jul 09 Sep 09 Nov 09

0%

1%

3%

4%

5%

PEER GROUP COMPARISONS

28

Need to choose appropriate peer

groups for meaningful comparisons

Source: HFMA’s

29

TIMELY DATA

You need recent data to set appropriate

performance targets; industry trends affect

expected performance levels.

Organizations need to “raise the bar”

as industry performance improves.

Although median days in A/R was

about 52 in 2004, it dropped to

about 46 in 2009.

This shows that data need to be

current to establish a relevant

benchmark.

Median Days in A/R

EVIDENCE BASED IMPROVEMENT:

IMPROVING PERFORMANCE

INSIGHTS FROM AND ABOUT

HIGH PERFORMERS

Research

– % of high performers citing

importance of investing in front-

end technology

– % of high performers having

estimates available for patients

at registration

Successful practices

– Sample scripts

– Use of dedicated trainers for

patient access staff

31

Area for improvement: Cash collection

Cash collection as a % of

adjusted net patient services

revenue

– Median: 100.2

– Top quartile: 102.1

Source: HFMA’s March 2010

HFMA’s MAP Award recognizes healthcare

organizations that achieve excellence in the

revenue cycle and serve as models for the

healthcare industry

MAP AWARD

32

SUCCESSFUL PRACTICES

SUCCESSFUL PRACTICES

Culture

People

Processes

Technology

Communication

34

CULTURE

76%

86%High Performing

All Other

SUPPORT FOR REVENUE

CYCLE

36

7 = Extremely high to 1 = None at all

37

PEOPLE

High Performers >10 days

5-10

days 3-5 days 2-3 days

1 day

or less

Registrars 57% 14% 14% 14% 0%

Billers 57% 14% 14% 14% 0%

Collectors 50% 21% 21% 7% 0%

Financial Counselors 64% 14% 14% 7% 0%

All Others >10 days

5-10

days 3-5 days 2-3 days

1 day

or less

Registrars 42% 25% 15% 11% 7%

Billers 54% 25% 7% 10% 4%

Collectors 47% 30% 10% 9% 5%

Financial Counselors 52% 26% 10% 7% 5%

DAYS OF INITIAL REVENUE

CYCLE TRAINING REQUIRED

38

STRATEGIES TO MOTIVATE,

RECRUIT, AND RETAIN STAFF

19%

31%

44%

43%

64%

86%

0% 50% 100%

High PerformingAll Others

39

Increase front-line staff salaries (beyond average organizational increase)

Provide incentives for staff who meet goals

Increase back-office staff salaries (beyond average organizational increase)

40

PROCESSES

Process centered improvement

team(s) meet at least weekly

Revenue cycle staff team meet at

least monthly

Cross-functional team meet at

least monthly (including reps

from clinical, IT, HIM, . . . )

3%

25%

51%

26%

84%

21%

50%

57%

50%

71%

0% 20% 40% 60% 80% 100%

High Performing All Others

Metric triggered leadership teams

(triggered by revenue cycle metric

outside defined parameters)

Other (responses generally include

more frequent, targeted meetings)

FREQUENCY OF REVENUE

CYCLE TEAM MEETINGS

41

20%

43%High Performing

All Others

USE OF PATIENT FOCUS

GROUPS

42

Routinely meet to discuss & implement

process streamlining initiatives

Routinely meet to review & discuss issues

regarding patient satisfaction

Routinely meet to discuss & implement

technology improvements and interfaces

Routinely meet to review & discuss

payment discrepancies

Do not routinely collaborate

with payers 35%

57%

26%

25%

21%

7%

86%

64%

64%

57%

0% 20% 40% 60% 80% 100%

High Performing All Other

COLLABORATION WITH

PAYERS

43

Registration

Financial Counseling

Admitting

Billing

27%

31%

21%

24%

23%

50%

29%

43%

50%

64%

0% 20% 40% 60% 80% 100%

High Performing All Other

Collections

SIGNIFICANT CHANGES TO THE

FOLLOWING AREAS WITHIN THE PAST 3

YEARS

44

1 = no improvement to 7 = complete overhaul

TECHNOLOGY

IT collaboration

with revenue cycle

IT support for

revenue cycle

51%

55%

71%

79%

0% 20% 40% 60% 80% 100%

High Performing All Other

TECHNOLOGY SUPPORT FOR

THE REVENUE CYCLE

46

7 = Extremely high to 1 = None at all

COMMUNICATION

We provide estimates to nearly every patient

At time of service, upon request

At scheduling, upon request

At registration, upon request

We do not provide estimates 10%

33%

40%

53%

16%

7%

43%

57%

36%

21%

0% 20% 40% 60% 80% 100%

High Performing All Others

AVAILABILITY OF ESTIMATES FOR

PATIENT OUT-OF-POCKET LIABILITY

48

0%

1%

9%

48%

84%

0%

7%

7%

64%

71%

0% 20% 40% 60% 80% 100%

High Performing All Other

Managers, Directors, CFO

Registrars

Financial Counselors

No approval needed if patient meets organizational Charity Care Policy

Schedulers

WHO HAS ABILITY TO APPROVE

PROVISION OF CHARITY CARE

49

Spectrum Health System

Successful Practices

2

Automated Eligibility, Address

Checking and Propensity to

Pay - Revenue Cycle Strategy combining

People, Process and Technology.

March 10, 2011 Prepared and presented for:

association of Illinois

Patient Access Management

3

Tracey McKnight, RN,MM,CMAC

Senior Director – Revenue Cycle Management

Spectrum Health Hospital Group

Ami Kihn

Senior Director – Patient Financial Operations

Spectrum Health System

4

MAP Case Study

About Spectrum Health

Spectrum Health is a not-for-profit system of care dedicated to

improving the health of families and individuals. Our

organization includes a medical center, regional community

hospitals (7), a dedicated children’s hospital, a multispecialty

medical group, affiliated physicians and a nationally recognized

health plan, Priority Health.

Spectrum Health has over 16,700 employees and 1,500

physicians

6

Mission, Vision, Values

MISSION: To improve the health of the communities we serve

VISION: To be the nation’s highest quality and most successful

healthcare enterprise

VALUES: Compassion, Excellence, Innovation, Integrity,

Respect, Teamwork,

7

Revenue Cycle

Overview Revenue Cycle Technology Systems Planning, Integration, Deployment, Stabilization

Revenue Cycle Policy and Procedure

Compliance and Payer Relations

Revenue Cycle Leadership and Direction

Revenue Cycle Education and Training

Phys Relationship

Access

Service

RequestScheduling

Clinical Prep

Registration/Check-

In

CodingClinical Encounter Patient Finance

Eligibility

Financial ClearancePre-Registration

Address

Pre-Arrival

Patient Readiness

Cash ApplicationDenial

ManagementAcct. Follow Up/Mgt.

Customer Svce Call Ctr.

Claim Submission

Check-out/

Discharge

CCAPPatient Placement

Discharge Planning

Social Work

Charge Capture

AuthorizationFinancial

Counseling

Time of Service PymntConsent/Forms

MSPMySpectrum Enroll

ID CardsScanning

WayfindingOrder Follow Up

Care Management/

UM

HIM

Revenue

Integrity

Charge

Capture

Clinical Treatment

Patient Billing

Project Methodology

Agenda

9

Initiate Idea

■Project Sponsor Identified

■Vision and Business Objectives

■Resource Estimates

■Leadership Support/Project Structure

Develop Concept

■Resource Estimates Defined and Resources Committed

■Project Plan Developed

■Project Plan Approval and Project Funding

Agenda continued

Plan & DO

■Project Overview

■Project Inclusions

■Integration Development

■Process Flow Changes

■Education and Training

Implement & Evaluate

■ Go-Live Decision Documented

■ Go-Live Statistics

■ Criteria to Measure Success (Dashboard)

Questions

Project Vision and Business Objectives

Project Vision

■ To provide tools and resources to the front-end/first patient contact areas to identify correct and accurate patient demographic and insurance

Business Objectives

• Decrease number of Self Pay designations at the time of service/registration due to valid insurance

• Decrease Self Pay referrals made to Financial Counseling because truly has insurance

• Decrease customer service phone calls

• Increase clean claims submissions

• Reduce front end edits for incorrect subscribers

Project Structure

Oversight Committee- Representation Includes Leadership supporting: Patient Access- Facility, Patient Financial Services- Facility, Professional Business Office, TIS, United/Kelsey, Reed City

Work Group Structure- Several Workgroups throughout project to include personnel from all areas as indicated above- work items included: Address Checking, Credit Checking, Propensity to Pay, Eligibility, Pre-Encounter

RevRunner Utilization Work group – established after go-live (s) to continue to monitor activities, questions, enhancements, reports, quality activities, etc of the RevRunner users and system

12

Project Overview

Automated Verification Tool

■ Patient Demographics (Patient ID)

■ Eligibility (Verifier)

■ Ability to Pay (Propensity to Pay)

Integrated with Core Technology

■ Cerner (Patient ID and Verifier)

■ Healthquest (Patient ID and Verifier)

■ Horizon’s Practice Plus (Verifier)

■ Misys (All Modules Stand Alone)

13

Overview- Address Checking

Patient ID:

This functionality will allow for us to verify and validate

guarantor address to ensure accuracy of the information in our

core systems. This will improve identification of the patient;

assisting with response to compliance with Red Flag

Regulations, as well as decrease the rate of returned mail;

improving the length of the billing and collection cycle with the

patient.

14

Overview- Eligibility Checking

Verifier:

Verifier allows us to verify and validate the accuracy of the

insurance information in our core systems. With this

functionality we can assure that the patient is still eligible for the

identified insurance and, as provided by the insurance plan, we

are also able to gather benefit levels, co-payments, and

deductibles to determine the patient’s out-of-pocket obligation.

This functionality will prevent unnecessary re-submission of

bills due to inaccurate or ineligible insurance information, as

well as, improve our ability to collect prior to and at the point of

service.

15

Overview- Propensity to Pay

Propensity to Pay Scoring:

Through utilization of the Propensity to Pay module we will be

able to identify a patient’s ability to pay for their healthcare

services either prior to or at the time of service, depending on

the nature of their visit. This will enable us to focus our

collection efforts, providing education on potential Medicaid

eligibility or assistance with determining payment options or

financial assistance as necessary.

16

Scope Inclusions

Locations:

■ Grand Rapids Hospitals

Butterworth

Blodgett

HDVCH

■ United Hospital

■ Kelsey Hospital

■ Reed City Hospital

■ Kent Long Term Acute Care

Hospital

Technology:

■ Horizon’s Practice Plus

■ Misys

■ Cerner

■ Healthquest

17

Integration

270/271 Transactions:

■ Allows for checking insurance eligibility real-time during the registration process (Cerner, Healthquest, HPP)

HL7 Transaction:

■ Allows for eligibility checking after the registration process (Cerner, Healthquest)

■ Added the ability to check guarantor address by a Yes/No Indicator (Cerner)

■ Allows us to pre-populate fields to cut down on manual entry during the credit checking inquiry

Testing Unique - Live patient testing required given nature of work

Batch File Reports – CCL out of Cerner, Healthquest or queried out of Ensemble (can set up when to run and how often)

18

Stand Alone versus Integration

Staff may elect to utilize as a stand alone system in

appropriate circumstances

Education and Training developed scenarios to guide

staff when to utilize in stand alone environment

Once data is entered into the technology system,

integration is forced through the 270/271 transaction sets

19

Integration Diagram

Process Flow Changes

Created new process flows for the use of automated eligibility

and address checking in the below areas:

■ Scheduling

■ Pre-Arrival

■ Point of Service

■ Emergency

■ Verification – Prior to Service

■ Financial Counseling – During Service

■ PFS – post service

■ Primary Care

Process Flow Example

Education and Training

■ Deliver education in e-Learning environment and paper

based education completed as well. Specific Modules

below:

■ Integrated Version

■ Standalone Version

■ Administrative Functions Module

■ Including education to support scripting and links to

procedures and process

■ Provided on-site training to each individual area

23

Examples of Education Materials

Go-Live Statistics/Successes

Rolled Out Verifier and Patient ID to over 68 department locations (October 2009 – July 2010)

Began Propensity to Pay roll out October 2010 (anticipate completion June 2011)

Currently have over 600 hundred users

Average about 200,000 eligibility checks per month

Average about 32,000 address checks per month

Go-Live Statistics/Successes continued

Mail returns per month are at about 2.0%

Insurance discrepancies from registration to billing has gone down from around 9% to 7.9% on average

Self pay/NA designation at registration changed to another insurance in Finance has decreased from 23% to 6% in a 9 month period

Dashboard

Dashboard Continued

Next Steps

Complete roll out of Propensity to Pay

Integration to Medical Group Technology and Processes

Key Lessons Learned:

Project Management Methodology

Strong Executive Leadership

Change the process, not just technology

Understand what done looks like

Metrics, Metrics, Metrics

Keep momentum going

Have fun/celebrate

Questions?

32

Propensity to Pay Evaluation –

A patient friendly process to support

the growing shift of financial

responsibility.

33

Agenda

What and Why

Propensity to Pay Validation/Scoring Matrix

Target Process Changes

Pilot Phase

Timeline

Next Steps

34

Propensity to Pay

What is it?

Why Consider it? .

An individual’s ability and likelihood to pay

for their healthcare services

To be able to communicate financial liability to the

patient

as early in the Revenue Cycle Process as possible.

Example: Propensity to Pay Scoring

Color and Score Assigned – Red = Low credit, low income – (Presumptive Charity)

– Yellow = High credit, low income – (Payment Plans)

– Blue = Low credit, high income -

– Green = High credit, high income

35

Process Changes

• Presumptive Charity Determination

• Reduction/Elimination of Manual Financial Assistance

Application Process

• Fewer Touch points along Revenue Cycle- predetermined

accounts flagged early, eliminating statements, phone calls,

and unnecessary collection effort and expense

• Targeted collection efforts based on Propensity to Pay score

• Care Management process enhancements

• Collaboration efforts with SH Medical Group

36

Phase 1: Validation

Target Goal= at least 85% of the validation accounts match P2P

Recommendation

37

92.2% 88.9% 91.3%

7.8% 11.1% 8.7%

0%5%

10%15%20%25%30%35%40%45%50%55%60%65%70%75%80%85%90%95%

100%

Self-pay pilot accounts Financial counseling pilot accounts Total pilot accounts

P2P pilot discrepancies

P2P score matches P2P score discrepancies

38

Validation Results

The majority of the time the tool produced the

Propensity to Pay score that we expected

For the accounts with discrepancies SH found the

tool was more conservative in scoring than what we

would have been in our determination process

39

December 22, 2010 – March 1, 2011

• Butterworth Campus Emergency Dept Financial Counselors

• Self Pay Patients

•Out Patient Accounts (not admitted from ED visit)

Phase 2: Pilot

40

Next Steps

• Run Batch file of existing Self Pay Accounts Receivable to

identify Presumptive Charity Accounts – Complete by

03/01/11

• Identify where in current collection process ongoing batch

files will be sent for scoring.

• Develop deployment Calendar for go live sites.

• Develop and Deliver Education materials to targeted staff to

coincide with go live planning.

• Update Financial Assistance Policy and Procedures

Next Steps (cont.)

• Increase awareness for all Revenue Cycle Staff

• Partnership and Communication with Medical Group on

Financial Assistance Determination

• Partnership and Communication with Care Management on

Financial Assistance Determination

41

42

Questions?

42

43