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Is your hospital shortchanging its front end? Show them these figures
It's the 'perfect time' to obtain resources
Even though patient access has a major impact on the hospital financially, the department often is still shortchanged. This is especially true now, with hospitals looking to cut costs anywhere they can, implementing hiring freezes, and asking departments to do more with less.
Peter Kraus, CHAM, CPAR, a business analyst with patient financial services at Emory University Hospital in Atlanta, says that one facility's access department had to let seven staff members go, with the director taking a 10% pay cut, along with other directors in the organization.
"Whether hospitals will lose money in the long run by taking such measures is not necessarily easy to quantify. In principle, the answer is yes," says Kraus. "But it depends on what access has been doing up to that point to contribute to the bottom line."
Also, if an organization's budget is squeezed by current economic circumstances, notes Kraus, it may be forced to cut back on present expenditures regardless of how those cutbacks compromise future financial performance.
"That said, one would hope that, even in hard times, an access department with an aggressive, proven record for enhancing the revenue cycle will always be in a more favorable position than one that is viewed as simply clerical collectors of data if any still are these days," says Kraus.
Depending on what happens in the financial world, and at your facility in particular, cutbacks may be unavoidable. "In that case, the fate of aggressive upfront programs may rest on their past record," says Kraus. "If there is no quantifiable past record, the facility will have no way to verify that a valuable program is being put at risk."
If you believe your front end is being shortchanged, there's no time like the present to make higher-ups aware of what an investment in the upfront revenue cycle could do to the hospital's bottom line.
"I think the industry, as a whole, is more aware of the criticality of access functions than it has been in the past," says Kraus. "But it never hurts to remind the powers that be."
Time is right for action
Here are some actions you can take:
Create reports and other measures, not only to gauge how your department is doing, but with an eye on demonstrating the program's impact to the bottom line.
"This can be a lot more than merely collecting copays and deductibles," says Kraus.
For example, obtaining upfront insurance verification and pre-certification can save many dollars in denied claims. You can demonstrate this with before-and-after statistics.
"Getting insurance data right upfront the first time, or at least before the account is billed, can reduce both the number of rebills and the number of days it takes to collect the account," says Kraus.
Be prepared to work with fewer resources.
Whether or not you succeed in "doing more with less" may depend on your department's current staffing levels. "If they are minimal, something is likely to give," says Kraus.
However, if your department has been maintaining reports and records of its financial impact, you are in an excellent position to quantify your effect on the bottom line.
This information can be particularly useful if your resources are being cut. "What so often is asked is not to abandon a program but to maintain it if not expand it with fewer resources," says Kraus.
To manage resources in a shrinking department, Kraus suggests focusing well trained staff, possibly supervisors, in rigorous post-registration quality assurance and follow-up. "You want account information to be as complete as possible and 'claim-ready' in the interim between discharge and final billing," he says.
Attempt to get better deals from vendors.
Kraus says that this also is a good time to "lean" on outside vendors to provide additional services, or services at more favorable rates. "They are doubtless aware of the facility's tightening circumstances, and don't want to lose the business," says Kraus.
A simple example might be asking a vendor who verifies insurance coverage and benefits online to expand the service to include demographics verification and eligibility for assistance or charity write-off.
Look for ways to collaborate.
"Access should position itself as a collaborator, not a resistor," says Kraus. "It should be proactive in finding ways to work more efficiently, not waiting for draconian measures to come down from on high."
For example, vendors with insurance verification products may be working with other departments at your hospital, which might give you more leverage with rates. "Working collaboratively makes sense, in good times or bad. It can become a necessity to cope effectively with cut-backs," says Kraus.
You'll also want to work with the business office to be sure that account information is "claim-ready." "It is in everyone's best interest to send out a clean bill the first time," says Kraus.
Invest in front end
Beth Keith, CHAM, manager of ACS Healthcare Solutions, says that the best performing organizations spend more dollars per claim in patient access rather than in billing and collection, and also, spend less overall per claim to collect.
"This should be a perfect time to present to administrators the benefits of front-end preparation to reduce the overall cost of collection," says Keith. "This is a metric that is widely used to measure performance in the collection arena."
Most of the software necessary is priced in the mid to low range, says Keith, so the return on investment is typically seen in less than two years.
"There are many good articles and documented success stories related to the increase in collection by adding the right software and effort up front," says Keith.
She says that the major collection companies will tell you that your chance for collection is 95% if done in advance and 75% if done at the time of service but once the individual leaves the premises, the collection success rate drops to about 10%.
For this reason, investing resources on the front end is a good idea. "The most significant return on investment is produced by maximizing IT resource dollars at that point in the revenue cycle process," says Keith.
The reason is that patient data provided are accurate including address, insurance, medical necessity, and overall coverage options. "Co-pays can be accurately estimated and collected at the time of entry into the system," says Keith. "The activity of billing and collecting will flow just as it is supposed to, without human intervention."
If each of these steps is performed correctly, little beyond posting the payment has to be done on the back end in the traditional billing and collection process. "And typically that can be done electronically as well," says Keith.