hipaa: overview and impact on revenue cycle · hipaa: overview and impact on revenue cycle lee...
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Transaction Standards and Code Sets and Their Effect on the
Revenue Cycle
HIPAA:HIPAA:Overview and Impact Overview and Impact
On Revenue CycleOn Revenue Cycle
Lee Barrett, Director, Health Care Practice PricewaterhouseCoopers, [email protected](860) 543-2275 (cell)
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Agenda
Brief HIPAA Overview and Background
Approach to HIPAA and the Changing Landscape
HIPAA: Where’s the Beef?
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• E-Health - transformation in health care to private, personalized, interactive and secure use of Internet
• Genomics - breakthroughs will shift system from cure to prevention while placing an even higher premium on security and privacy
• Consumerism - empowered consumers create impatient patients demanding information and access
HIPAA endorses exchanges of PHI via the internet with appropriate
privacy & security controls.
A Context for Change
HIPAA intersects with three key industry drivers identified in Health Cast 2010
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HIPAA Capabilities Model
Overall Objectives:
– Conduct a HIPAA assessment that will provide a representative analysis of its security and privacy risks.
– Analyze TCI, Privacy and Security (internal and external)
– Develop GAP Analysis– Develop a Comprehensive Implementation Plan– Develop detailed projects with resource
requirements– Determine in-source and out-source options– Provide ongoing HIPAA updates & support
Benefits:
– Enterprise wide security and privacy framework that reflects the strategy and mission of the organization
– Risk mitigation– EDI benefits and cost reductions– Revenue enhancements– Better clinical and business data– Greater data availability– Customer satisfaction
People
Technology
Strategy
Management
Knowledge
Support
Technologies
LeadershipExecutive Sponsorship
Security/Privacy FrameworkSecurity Program Structure
Security Program Resources and Skillsets
Policies & ProceduresSecurity Policies, Standards and Guidelines
ManagementSecurity/Privacy OperationsSecurity/Privacy Monitoring
User ManagementUser Management
User Awareness?Behavior
Information Asset SecurityHost Security
Database / Metadata SecurityElectronic Commerce Application Security
Internal Network SecurityInternet Security
Technology Protection and ContinuityPhysical and Environment Controls
Contingency Planning Controls
Capabilities Model
Process
Charges
Collections Posting Contract Monitoring
Bad Debt Processing
CodingCharge Capture
Documen-tation
Pre-admission Admission Financial
CounselingInsurance
Verification
“Front-End”
“Billing”
“Back-End”
Follow-up
Billing
HIPAA & The Revenue Cycle
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HIPAA Regulatory Timeframe
Transactionsand Code Sets
Security
6/03
NPRM Published Final Rule Date Date Compliance Required
Expected Final Rule Date Expected Date Compliance Required
Privacy
Health Plan ID
Individual ID
6/98 6/00 6/01 6/0212/98 12/99 12/00 12/026/99 12/01
These NPRMs have not been issued in
initial draft
8/2000 10/2002
Provider ID
Employer ID
12/2000 4/2003
Enforcement
Extension
10/2003Testing
Final Rule
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Standard Transaction Flow
Enrollment
Pre-Certification &Adjudication
Claims Acceptance
Claims Adjudication
Accounts Payable
EligibilityVerification
Pre-Authorizationand Referrals
Service BillingClaim Submission
Claims StatusInquiries
AccountsReceivable (AR)
Functions
Providers
Functions
Payers
Enrollment
Functions
Sponsors
270 (Eligibility Inquiry)
271 (Eligibility Information)
837 (Claims Submission)
835 (HealthCare Claim Payment Advice)
270 (Eligibility Inquiry)
271 (Eligibility Information)
834 (Benefit Enrollment & Maintenance)
810 (Invoice)**
820 (Payment Order/RA)
275 (Claims Attachment)*
276 (Claim Status Inquiry)
277 (Claim Status Response)
278 (Referral Authorization and Certification)
148 (First Report of Injury)*
These are not contained in the initial Transactions and Code Sets Final Rule*
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How HIPAA Impacts The Revenue Cycle?
Front OfficePhysician InteractionOrdering lab/x-ray testsUsing reference labsCommunicating with outside agenciesEligibility/Pre-CertificationClaims billingClaims Follow-up
Hospital AdmissionsDocumentation and CodingTracking systemsMedical StudentsConsultsPre-authorizationsClaims managementContract payment compliance
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Reduced Accounts Receivable Cycle
Improved Customer Service
Quicker Cash Flow
Improved Accuracy (5% data entry errors)
More Efficient Operation
Code Sets and Transaction Standards
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Lower FTEs
Reduce/Eliminate Rework
Reduce Operational Costs (office supplies, postal costs, and telephone charges)
Chance to Automate Resolutions
EDI Benefits - Tactical
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Assessment Impact of Transaction Standards and Code Sets on a 200 bed hospital
Financial Impact
$49,920 $199,680
$-0-$24,960$49,920 $37,440
$361,920$79,622
$442,542
FTE Impact
-2-8-0-1-2-1
-1222%
Impact Assessment
Pre-Cert/RegistrarsCollection SpecialistsBillersCashiers/Cash PostingFinancial Counsellors Supervisors
Total Savings Fringe Benefit Reductions
TOTAL Potential FTE Savings
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Assessment Impact of Transaction Standards and Code Sets on a 200 bed hospital
Financial Impact
$14,500$3,600
$22,500
$8,000
$20,000
$68,600
Impact Area
-12-3
-1,500 sq. ft
-4 tons
-Misc. Overhead
Impact Assessment
TelecommunicationsNumber of Phone LinesNumber of Fax Machines
SpaceCost per foot (allocated in budget)
Paper ProductsClaims and related attachments
Other:
Total
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Assessment Impact of Transaction Standards and Code Sets on a 200 bed hospital
Financial Impact
$3,424,660
$171,233
Calculations
$125,000,000$20,000,000
$342,46658.40
10 Days
Impact Assessment
Annual RevenuesGross Accounts ReceivableAverage Daily Gross RevenueGross Days Revenue in Accounts ReceivablePotential GDRO Reduction (Over Time)
GDRO Savings Invested at 5% Annually Interest Income
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Potential Total Costs Savings for one 200 bed Hospital
$682,375
Assessment Impact of Transaction Standards and Code Sets on a 200 bed hospital