Revenue Cycle Management

Gwinnett Health System reinvents revenue management with help from an unlikely hero.

Then Gwinnett Health System faced the challenge of reinventing its financial practices to deal with a changing healthcare industry, Cathy Dougherty could not stop thinking about a certain children’s movie. The assistant vice president of revenue management had visions of "Toy Story" – a film that depicts the secret lives of action figures and stuffed animals – dancing in her head. Dougherty kept thinking that even though the movie is an entertaining, creative children’s flick, the storyline contains a number of change-management lessons that could be applied in the healthcare setting. Leaning on the movie for inspiration and as a training tool, Dougherty led an initiative to reinvent the two-hospital health system’s revenue-management practices. First, she selected a next-generation revenue-management solution that provides the bandwidth to deal with emerging trends in the healthcare industry. Second, she drove a comprehensive change-management program designed to reinvent revenue practices. As a result, the Lawrenceville, Ga.-based non-profit provider improved efficiency, enhanced patient service and bolstered its bottom line.

The Next Evolution in RCM

By Tony Reisz, president, Ontario Systems

This year will bring an evolution to revenue-cycle management, bringing the focus to the front end of the revenue cycle to patient-access management. This is one of the last areas where hospitals can save substantial amounts of money.

By moving the revenue cycle to the beginning with patient access, healthcare organizations improve their upfront collections, set patient-payment expectations, manage denials and retrieve self-pay balances before the medical procedures take place. Patient-access management increases the bottom line by reducing the cost of healthcare and increasing the dollars collected. At the same time, it leads to improved levels of patient satisfaction.

Software is instrumental in helping perform root-cause analysis of coding errors and omissions, creating an early identification process of clinical practice charge-capture trends.

St. Joseph Hospital, a 112-bed nonprofit community hospital in Bangor, Maine, recognized that it had several pressing revenue-cycle challenges. Among these were concerns that as coding requirements continue to increase in complexity, capturing all charges manually and then ensuring accurate coding would become more difficult.

Claims editing is a step in the claims payment cycle that involves verifying that physician-submitted bills are coded correctly. While claims-transaction systems have some native editing and duplicate checking abilities, these systems are designed to adjudicate claims. As such, even the most robust transaction systems need some help to avoid overpaying claims. Faced with the need for additional editing, payers should decide whether to build an internal editing system or outsource the responsibility to a third-party vendor.

Among the lessons learned in pilot project is the need for comprehensive revenue-cycle management systems and processes.

San Diego County’s Scripps Health (Scripps) was one of many health systems across three states taking part in a three-year recovery audit contractor (RAC) pilot project. "Scripps had a number of challenges at the start of the process," says David Cohn, vice president, revenue cycle, for Scripps.

While the Kentucky Medical Services Foundation was successful in converting users to the new platform, there were surprises along the way.

Two systems, six years and almost 300 users ago, the Kentucky Medical Services Foundation (KMSF) investigated whether or not automated charge-capture technology was a viable solution for its physicians. KMSF, a provider of billing and other administrative services for the more than 700 providers who deliver care across more than 80 sub-specialty areas, had little familiarity with the technology. Interested in its potential, KMSF initiated a pilot study, engaging a small group of physicians to determine if this type of mobile computing would add value to the charge-capture process.

Contract-management system helps centralized billing office recover $2.7 million in contractual underpayments.

When the UCLA Faculty Practice Group (FPG), Los Angeles, began centralizing its billing and collections operations several years ago, it identified a range of measures to pursue in order to take advantage of the restructuring. The physician billing office of UCLA FPG, responsible for billing for 1,300 providers at four hospitals and 65 clinics, first decided to centralize billing for most of its departments.

"We wanted to enhance our efficiency and also improve our financial position," says Anton Loman, director of quality development at UCLA FPG. "One of the initiatives that resulted from the centralization was to transition to a system for validating reimbursement and managing our payers’ performance against contract terms."

Investment in process redesign and claims management technology leads to financial success for a growing physician practice.

Olive Branch Family Medical Center was a paperless practice almost as soon as it opened in August 2003. A spin-off from a larger medical group, its practice management (PM) system was in place from day one, followed by an integrated electronic medical record (EMR) several months later.