The growing number of hospitalists that are billing Medicare for higher-severity encounters may be an important driver of rising hospital costs.
Hospitalists are more likely to bill at the highest level of clinical severity possible for their medical encounters for hospitalized Medicare patients compared with non-hospitalist who see similarly complex patients, according to a study published by the Journal of the American Medical Association.
In addition, this gap has been growing over time from the study's earliest samples from 2009 to the latest in 2018, the study said.
The study looked at more than four million Medicare fee-for-service Part A and Part B medical claims between the years of 2009 and 2018 and compared the high-severity billing between hospitalists versus non-hospitalists across initial, subsequent, and discharge encounters.
Hospitalists were found to have more of these medical encounters in the hospital, reaching roughly 775 of all encounters by 2018. According to the study, "high-severity billing increased over time for hospital encounters at higher rates for hospitalists than non-hospitalists," noting the differences "do not appear to be explained by patient complexity."
Additionally, "the increase in the number of hospitalists over time may be contributing to rising national costs related to hospital care," the study said.
When automating areas within the revenue cycle, the coding department is a common place to start. Bridgett Feagin shares insight on the medical center's automation preparation.
Automating areas of the revenue cycle is becoming more common place for many organizations and it's not unusual for automation to begin within the coding department. In fact, over the past two decades, medical coding automation has steadily increased across the healthcare industry as a means of coping with complex and increasing coding systems.
Connecticut Children's Medical Center, which has locations all across Connecticut ranging in more than 30 different specialties, is also working on automating its revenue cycle. The healthcare system is preparing to automate a part of its medical coding department to help enable precise and rapid medical billing and improve payment cycles.
Healthleader's recently got the chance to hear from Bridgett Feagin, Executive Vice President and CFO at Connecticut Children's, about its upcoming automation implementation and tips for other organizations looking to follow suit.
HealthLeaders: What created the need for this automation within your revenue cycle?
Bridgett Feagin: At Connecticut Children’s, we are always looking to improve our revenue cycle operations and one way is by identifying automation opportunities. We are working with the company Nym, which brings coding software that will decrease our lag times and improve time to bill with emergency department encounters. The software is able to complete a significant number of the encounters, thus allowing for our coders to focus on the complex cases that require human review and intervention.
HL: How exactly will you be using the software to streamline coding and billing, and how long will it take to implement such a large change?
BF: We are currently working with the company to design and build the system to capture our coding. This includes utilizing our facility-based, emergency-department point system to determine resource use and commonly captured procedures. The software is able to capture charges for the professional and facility, emergency-department level as well as any procedures performed and ensure all charges are accounted for.
We are anticipating a go-live later this summer, and once we go live, the automation will allow for less manual labor thus reducing the time for the bill to go out the door. Quicker billing typically accelerates the flow of cash-in.
HL: Which revenue cycle roles are responsible for overseeing this new process and what are their responsibilities?
BF: Our health information hospital coding and billingdepartments, along with the Nym team, are responsible for overseeing the process. Responsibilities include monitoring the anticipated impacts which include, but are not limited to, decreasing coding lag days across the organizationachieved by decreased emergency department coding volume, decreased hold days for billing, and improved overall accuracy rate.
HL: What does the future for your revenue cycle hold? Are you looking to automate other areas of the revenue cycle?
BF: The future of Connecticut Children’s revenue cycle holds increased payer partnerships, standardization, and automation. Over the past several years we have expanded simple visit coding to capture over 70% of outpatient encounters thus reducing the unnecessary review from a coder. This has allowed us to shift coders to meet the organization’s needs without having to increase staffing requirements. In addition, we are looking to further expand the Children’s Health Consortium to build synergies and create efficiencies with other independent children’s hospitals.
HL: What tips do you have for other organizations looking to automate certain departments within their revenue cycle?
BF: Always question the way things are being done.As technology changes, we must also change and adapt to remain relevant in today’s competitive healthcare industry. Accepting norms and not questioning them would cause us to remain stagnant and miss key opportunities to improve the services that we provide for our patients and families.
An organization's denial rate is a good barometer of its overall financial health and the soundness of its revenue cycle. A recent survey details how organizations stack up.
Although most organizations do a good job of tracking denials by reason, payer, and volume, they miss the mark when communicating information about appeals, appeal success rates, and how—or even if—denials and appeals data is passed on to payer contracting staff, according to the results of HCPro’s HIM Briefings’2022 Denials Management Survey.
The battle against denials gained new urgency due to the financial fallout of the COVID-19 pandemic. Revenue shortfalls, combined with staff and budget cuts, meant it was crucial for revenue cycle leaders to make the best use of available resources, make strategic decisions, and protect appropriate revenue.
The majority (77%) of respondents in the HCPro survey indicated their organization dedicates certain revenue cycle staff and resources to denials management: 36% have a denials management team, 28% have a denials management department, and 12% have a denials management program.
Although a formal denials management department might be out of reach for a smaller organization, a dedicated team or program will still produce good results and can make strategic use of resources.
Denials management is a truly interdisciplinary task, and a robust denials management program draws in experts from a variety of departments of the revenue cycle.
To learn more, the survey asked respondents to indicate what departments are responsible for denials management by selecting all that apply from a list.
HIM was the most common answer, with 43% of respondents reporting that department is responsible for denials management. Other common contributors to denials management include patient financial services (PFS)/billing (39%), revenue integrity (36%), and denials management (34%).
Some (21%) respondents selected “other” and shared additional departments and professionals their organization draws into denials management, such as utilization management/utilization review, CDI, and case management.
Denial rates and types
Organizations need to know what claims are being denied and how many denials they receive. This data is the foundation of a denials management strategy, answering the who, what, when, where, and why of denials.
Most (70%) respondents indicated they track denials by reason/type. To gain insight into that process, respondents were asked to indicate what departments are responsible for this task by selecting all that apply from a list. The top three responses were as follows:
·Denials management (44%)
·HIM (32%)
·PFS/billing (32%)
Thirteen percent selected “other” and noted additional departments involved in tracking denials, including CDI and case management.
However, some organizations are still struggling to collect data. “We do not have a good tracking system,” one respondent said.
So, what are some of the common denial reasons/types organizations are seeing? To find out, respondents were asked to rank denial types by whether they see a high, medium, or low volume of them.
Unsurprisingly, medical necessity led the pack with 20% of respondents reporting a high volume of this denial type. Missing authorizations are also a pain point, with 12% of respondents indicating they receive a high volume of these denials.
What’s the lowest volume of denials? Charge entry/CDM error: 45% of respondents ranked this denial type as low.
Overall, although most organizations are tracking their denials, they may not be communicating the full picture. More than half (67%) of respondents said they don’t know what their organization’s average denial rate is.
The AHA and AMA are pushing a court to put an end to the government's 'illegal interpretation' of a piece of the bill as soon as possible.
The American Hospital Association (AHA) and the American Medical Association (AMA) urged the D.C. District Court to act as quickly as possible to vacate certain provisions they are challenging in the government’s interim final rule on surprise medical billing.
For background, organizations have filed several lawsuits challenging how the HHS created an arbitration process for hospitals, doctors, and insurers to settle disputes over out-of-network medical bills under the No Surprises Act, which took effect January 1.
In February, a federal court in Texas ruled in favor of the Texas Medical Association and decided it was mistaken in its decision to instruct mediators to give past contracted rates between insurers and providers extra weight compared to other factors during the independent dispute resolution process.
"This decision is a major victory for patients and physicians. It is also a reminder that federal agencies must adopt regulations in accordance with the law," Diana Fite, MD, immediate past President of the Texas Medical Association said in a statement at the time.
The AHA and AMA are looking for more, though, as the groups have stressed that the court should not wait for HHS to issue a final rule before vacating these provisions.
HHS “have neither acquiesced to the decision of the Eastern District of Texas vacating portions of the September rule, nor suggested any intent to abandon their interpretation of the No Surprises Act in any final rule,” AHA and AMA said in a brief filed with the court.
“A decision from this court can put an end to the government’s illegal interpretation once and for all. As such, Plaintiffs respectfully ask the court to act as soon as practicable,” the AHA and AMA said.
Stemming from litigation, HHS says it has reduced a significant portion of its backlog of Medicare appeals.
In response to a 2018 federal court ruling in favor of hospital plaintiffs, by the end of the first quarter of 2022 HHS has reduced almost 88% of its backlog of Medicare appeals at the Administrative Law Judge (ALJ) level, according to a status report the agency provided to a federal court.
Still, 52,641 appeals remain pending at HHS' Office of Medicare Hearings and Appeals (OMHA), which is a reduction from 426,594—the total number of appeals identified in the original court order.
According to the ruling, HHS has until the end of fiscal year (FY) 2022 to eliminate the appeals in the Medicare appeals backlog. The court order gave HHS a series of goals to meet since the initial ruling, all of which have been met by the agency.
For years prior to the 2018 court ruling, HHS' OMHA was unable to keep up with the number of cases it received, leading to a mountainous backlog of pending appeals.
Thanks to a boost in appropriations from Congress, OMHA hired about 80 more ALJ staff, hoping to enable the office to catch up by the end of this year.
Although HHS is on schedule to meet its FY 2022 deadline, the court originally ordered HHS to eliminate the backlog by December 31, 2020. At the time, the American Hospital Association (AHA) accused HHS of dragging its feet. The AHA said the backlog hindered the ability of healthcare companies to do their work.
"Ending the backlog several years hence does not allow hospitals to upgrade equipment, repair aging facilities, or improve patient care now," AHA wrote in a 2018 federal court filing.
CMS has multiple, clearly defined levels of audits and appeals, and provider organizations can typically take an appeal to progressively higher levels—all the way up to the ALJ level.
The American Medical Association (AMA) is 'deeply concerned' by MedPAC's recent report recommendation and says it would 'imperil' patient access and quality care.
Following the release of MedPAC's March report to Congress, the AMA urged Congress to revise the Medicare Physician Fee Schedule (MPFS) to include stable, annual payment updates that keep up with inflation and practice costs.
In a letter to congressional leaders, the AMA stated that it is "deeply concerned" by MedPAC's recommendation to continue the freeze in Medicare physician payments in 2023 despite rising inflation in medical practices, statutory payment cuts to physicians, and fiscal uncertainties related to the COVID-19 pandemic.
Overall payment to Medicare physicians has decreased 20% from 2001–2021, when rates are adjusted for inflation, according to data from the advisory committee.
The AMA says this will influence provider organizations' patient experience, as the costs to practice medicine would "imperil patient access to high-quality care."
The medical association also cited a 2021 JAMA study, which says it costs an organization an estimated $12,811 and more than 200 hours per physician per year to comply with CMS' Medicare Merit-Based Incentive Payment system. "Most physicians still have not had opportunities to transition to value-based Medicare Advanced Alternative Payment Models (AAPM), as Congress intended, and have not been eligible for the annual incentive payments for AAPM participants," the AMA said.
The AMA also claims that the payment freeze is impossible to justify when viewed against a projected 8% payment increase for Medicare Advantage plans in 2023.
Related: CMS Cuts Medicare Payments to Docs, Extends Telehealth Payments
Leaders at Hutchinson Clinic share their experiences on outsourcing revenue cycle management processes to ensure the success of the organization.
Running an effective revenue cycle is no easy feat. That is why leaders at Hutchinson Clinic in Hutchinson, Kansas, knew they had to outsource some of its revenue cycle processes to ensure the success of their organization.
There are many areas within the revenue cycle that benefit from being streamlined, from better patient access to less coding denials, but one area of focus that is becoming more common is the need to reduce accounts receivable days in the billing department. Outstanding accounts receivable in healthcare are one of the most critical issues for an organization as they affect a hospital's bottom line.
Common benchmarks for accounts receivable days in healthcare include:
High performing: 30 days or less
Average performing: 40 to 50 days
Below average: 60 days or more
As the accounts receivable days for Hutchinson Clinic were hovering around average, Mike Heck, CEO, and Dashun Monk, CFO, knew the organization needed to reduce these days and rework the management of denied claims, among other inefficiencies, in order to prosper.
After brainstorming, their team realized that having an experienced, outsourced group of professionals working behind-the-scenes to handle the complexities of revenue cycle management was the missing piece that Hutchinson Clinic needed.
Heck and Monk recently spoke about their journey as leaders at the largest multispecialty clinic in Kansas and the three lessons they learned in enlisting a third party to help with its revenue cycle management.
Lesson 1: Realize the need for revenue cycle management expertise
Hutchinson Clinic is home to 535 employees, 63 physicians, 95 providers, and over 30 outpatient specialties. These include specialty ancillary services such as an ambulatory surgery center, physical therapy, radiology/diagnostic imaging, endoscopy center, and dietitian services.
Despite a culture at Hutchinson Clinic known for its convenience and patient satisfaction, there remained one lingering problem: a lack of an experienced revenue cycle management team that could ensure that basic financial responsibilities were being met efficiently and correctly.
In 2018, after a year of research and extensive interviews with third-party vendors, Heck and Hutchinson Clinic's board of directors brought on CareCloud (the parent company of Meridian Medical Management) to help with a variety of deliverables, including:
Accounts receivable follow-up
Charge entry
Claims coding
Denial feedback on coding
Patient posting
Physician education
"To me, it came down to leadership," Heck said. "We needed the right level and technical ability of leaders in the revenue cycle management arena. We couldn't establish consistency before they came on board."
Once Hutchinson Clinic's new revenue cycle management team ramped up, the positive results were seen fairly quickly across the board.
"Aside from the fact that we have drastically improved the financial stability of accounts receivable, the biggest benefit that I didn't foresee has been the ability to apply a larger trained workforce to certain projects," Heck said.
In addition to outsourcing an experienced and robust staff, Hutchinson Clinic introduced a healthcare analytics and business intelligence platform. The technology is used to manage data across the organization, which in turn, closes care gaps, increases revenue, and improves overall workflow within the organization.
Lesson 2: Keep patient experience in the forefront
While having an experienced partner was one piece of the puzzle, equally important to the Hutchinson Clinic team was the ability to find which methods worked the best for the organization internally, while still working to improve the patient experience.
The clinic has a team of roughly 60 in-house revenue cycle management employees who needed onboarding and training before all processes could be improved. At the same time, Heck was adamant that this process didn't disrupt continuity of care for the patients stretched across Hutchinson's large geographic footprint.
"The beauty of working with a partner like this is that they're handing all of the heavy lifting behind the scenes, enabling us to focus on patient engagement, provider recruitment, and retention," Heck said. "We've recently seen a positive response from the community as a result."
Being that Hutchinson Clinic is the primary source of care for those in Reno County, it's imperative that patient engagement is at the head.
"We see quality care and patient satisfaction as our number one responsibility," Heck said. "Having a stable revenue cycle management ensures that bills are getting out the door and payments are being made, which frees our team up to focus on other areas."
Echoed Monk, "I have peace of mind knowing that our revenue cycle, specifically the coding, accounts receivable, and posting components are happening correctly and in an efficient manner."
Lesson 3: Listen to staff and community stakeholders
Making an important change in revenue cycle management has a large effect on everyone involved with an organization, and one thing Hutchinson Clinic says it has gained through this experience is the importance of knowing their audience. In the case of its current partnership, the audience is twofold: the staff and the patients in the community.
Letting staff and patients know that you are listening to their questions and concerns when implementing a large change such as outsourcing is any easy way to help aid in a positive transition.
"We didn't want to sacrifice what was important to us and our community," Heck said. "When we're talking to our physicians about their pain points, such as coding or compensation, it's important for them to know we're listening. Same goes for the patients—we need to be making their lives easier, not harder."
Seeing results
While bringing in a third-party vendor isn't viable for every organization, Heck and Monk say there are takeaways that can be applied from their experience to help other health system executives accomplish their goals. These include:
Identify gaps. Every organization has areas they want to improve (e.g., reducing number of accounts receivable days, increasing cash flow).
Ask for help. "Find a subject matter expert on revenue cycle management and don't be afraid to ask tough questions," Monk said.
Change takes time. "It took us a year to identify a solution for outsourcing our revenue cycle management needs. It also takes time for a new partner to learn your language. Don't rush the process," Heck said.
Since outsourcing its revenue cycle management processes, Hutchinson Clinic has seen a reduction in accounts receivable days from 38 days to 33 days, thus shortening the time it receives payments from the insurance carriers. This five-day improvement of accounts receivable days is a 15% improvement for the organization. On top of this, the aged accounts receivable days of greater than 120 days has been reduced by 3% at Hutchinson Clinic.
"The processes put in place before outsourcing weren't moving us in the right direction," said Monk. "Today, we're meeting industry standards in terms of reducing accounts receivable days, ensuring doctor's compensation, and the efficient reworking of denied claims."
Industry leaders offer insight into management styles that have changed as revenue cycle staff is now more remote.
The COVID-19 pandemic has caused many organizations to shift staff to remote work over the last couple of years. Revenue cycle departments are no exception.
The National Association of Healthcare Revenue Integrity recently conducted an industry survey which included a variety of revenue cycle leaders. All respondents reported that their department's current work environment is now either completely remote (47%) or hybrid (53%).
Forty percent of respondents reported changes to their annual review processes or management strategies, processes, and policies.
Among the changes reported were the implementation of new productivity measures, adjustments to work hours to address time zone differences, and the development of new goals and goal-setting processes.
According to the survey, the implementation of productivity measures was the most frequently reported change. Such measures included daily and weekly electronic reports, more frequent personal communication between managers and staff, and daily meetings to discuss accomplishments.
"A hybrid model is preferred in our department," says Sevenikar. "Working from home is a privilege that is performance-based."
Dennis Shirley, vice president of revenue cycle at UnityPoint Health in Des Moines, Iowa, agrees that allowing your revenue cycle staff to work from home requires a focus on performance.
"Having remote staff has required a revamp of structure for productivity and managing our teams," Shirley said.
Sevenikar says she likes the idea of a hybrid work environment for her revenue cycle department because when working remotely, the knowledge transfer that happens when you are co-located can be lost. This, Sevenikar says, can create a huge disconnect.
To this point, Shirley adds that "when it comes to educating teams, you lose those collision points that your employees would have gotten from being at the office."
To alleviate these issues, it's important for revenue cycle leaders to routinely engage directors, managers, and other staff to create a sense of community.
"This feeling of being disconnected is not ideal for the workforce. In addition to daily huddles, I have a weekly, all-staff call to remedy this. There are almost 1,000 people that report to me across the enterprise and they are all invited to join the call. We discuss department updates, organizational updates, successes, questions, and just chat. We need to connect with our employees on what is important to them," says Sevenikar.
UnityPoint Health has done everything from sending out monthly newsletters for trainings, updates, and culture, to setting up coffee and lunch chats to manufacture that sense of community.
"Putting the focus on quality and productivity tracking, as well as manufacturing this culture, has been instrumental to our staff being remote," Shirley said. "Supervisors that monitor quality allow for the carving out of educational and personable leaders."
When revenue cycle teams are working remotely, it's more important than ever to recognize an employee's success and achievements, Sevenikar notes.
"We meet in a huddle and share an employee story. This helps to let them know I see them and so do their coworkers. This creates a sense of appreciation that dominos into feelings of trust and achievement," says Sevenikar. "Getting personal with your employees creates a culture of love and appreciation that will help to retain your staff."
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The Centers for Disease Control and Prevention (CDC) and CMS released new ICD-10-CM diagnosis codes and ICD-10-PCS procedure codes for use on claims submitted on or after April 1.
The new ICD-10-CM codes are used by the revenue cycle's coding team to report patients who are unvaccinated for COVID-19, partially vaccinated for COVID-19, and other underimmunization status.
The new ICD-10-PCS codes will be used to report certain COVID-19 vaccines and boosters, the administration of fostamatinib (an oral spleen tyrosine kinase inhibitor used to treat adults with low platelet count due to chronic immune thrombocytopenia), and certain monoclonal antibodies.
In the April 1 code update, the CDC also made available a Tabular List and Alphabetic Index addendum, Official Guidelines for Coding and Reporting update, ICD-10-CM order file, and finalized list of codes and descriptions.
In March 2021, the ICD-10 Coordination and Maintenance Committee announced it was considering an annual ICD-10-CM/PCS code update for April 1 in addition to the October 1 update. In the fiscal year 2022 IPPS final rule, the additional annual implementation date of April 1 was officially adopted.
The coding department is one of the most critical parts of the revenue cycle. Because coding occurs mid-cycle, it provides an opportunity to catch mistakes introduced earlier in the process, as well as preventing similar errors in the future.
Staying abreast of these regulatory coding updates is important for revenue cycle leaders as coding—and its completeness and accuracy—has a profound impact on an organization's bottom line.
Revenue cycle leaders scramble to fill roles in various stages of the revenue cycle process.
Healthcare leaders ranked the roles within the revenue cycle where they most need talent in a new survey released by AKASA.
The survey, which includes the responses from 400 healthcare financial leaders, ranked registrars, billing specialists, and patient follow-up staff as the most in-demand positions within the revenue cycle.
These revenue cycle roles followed closely behind:
Front-office staff
Central scheduling
Denial specialists
Authorization staff
Claims specialists
Collections
"We're seeing staffing gaps at every stage of the revenue cycle process," Amy Raymond, vice president of revenue cycle operations at AKASA, said in a press release.
"Revenue cycle departments are essential to the success of a healthcare organization," Raymond said. "When there's a demand, revenue cycle specialists are hired. When there's less demand, they're let go. This reactionary hiring cycle results in permanent workers often facing too much work and patients having a less-than-stellar financial experience."
The healthcare field has lost an estimated 20% of its workforce over the past two years , and hiring for those large staffing gaps has proven difficult for revenue cycle leaders.
Carlos Bohorquez, CFO at El Camino Health in Mountain View, California, told HealthLeaders that there was already a staffing shortage at his organization before the pandemic, and that forces each worker to put in a bit more effort.
But when the pandemic hit, and many healthcare workers were forced to do double shifts or work without days off, some quickly reevaluated their commitment to the profession. Then, as staff started quitting, things got especially bad.
Alicia Auman, director of patient access at KSB Hospital in Dixon, Illinois, is well aware of the need for registrars within in the revenue cycle and has worked diligently to improve staff retention.
"We developed a tiered pay scale. People who check in patients are paid in tier one. Once you have training and you've been in the department for a while, you can move into pre-registration, and you would get a bump in your pay. You're growing; we trust you with more and more responsibility. Tier three would be the authorization team and financial counseling," Auman told HealthLeaders.
"Since we implemented all of this, the staff satisfaction and our retention has gone up. Turnover was reduced by 42% to 25% in two years.
"These people need to know how to do this job. It's not just checking in patients; it's not just creating an encounter. There's important information that you need to get up front. We have changed that mindset in doing a career ladder.
"It was awesome because I wanted to show people that you can come in to access. Don't think of it as an entry-level position; think of it as an opportunity to build your skill set … you can go on to do something different in the revenue cycle. … It opens their eyes [that] there's a career path within healthcare that's not clinical."