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Elephant in the room

The Elephant in Your RCM Room

Shhhhhh….There are things we just don’t talk about when it comes to Revenue Cycle Management.  It’s ok to talk about collection rates, days in AR, aged balances and denial rates because we’re all on the same page here in terms of performance benchmarks and the process improvement activities we’re undertaking to address performance.  But what we don’t talk about… the proverbial elephant in the room… is revenue leakage, i.e., charges that were never captured or got lost along the way and therefore never get billed.

If we visualize the Mid Revenue Cycle simplistically as a funnel with patients entering the revenue cycle at the top of the funnel, care being delivered, documented and coded with revenues exiting the bottom, the goal for Revenue Integrity professionals would be to get as close to 100% of the revenue their organization is entitled to receive in the shortest time possible.  In physics, this is referred to as the volumetric flow rate which follows the basic formula Output = Volume/Time.  If your goal is to optimize mid-cycle revenue, you then have two levers to pull…

  1. Make the flow “frictionless” by re-engineering and streamlining processes, AND
  2. Add more volume by eliminating waste in the form of Mid Revenue Cycle leakage (i.e., missed, miscoded or misplaced patient charges that leach out of the funnel).

I’ve emphasized the word “AND” because both volume and efficiency are critical factors in optimizing revenue.  Today, very few healthcare organizations are addressing the volume issue for two primary reasons…

  1. They lack the tools or analytics to measure and monitor leakage
  2. They view leakage to be a performance deficiency instead of an opportunity.

The reality is that leakage occurs in every hospital or physician practice – HFMA has estimated that 3-5% of all charges never get posted – and very little of it is related to human error.  Leakage often results from technology gaps, ill-advised or obsolete billing practices, or upstream process problems that are systematically causing leakage that can easily be re-engineered once the problem is identified, quantified, and analyzed for root causes.

This is why Revenue Assurance Programs are growing in importance.  Whereas revenue cycle management (RCM) solutions focus on streamlining operational processes surrounding known charges, revenue assurance concentrates on the identification of omitted charges that never make their way into your revenue cycle queue or have leached out of your revenue funnel. There are very few companies that focus exclusively on revenue assurance. An even smaller number combine a technology solution with a service component that intervenes to reduce false positive findings while also providing analysis that creates a dialog about codifying best practices. Applying rules-based and predictive analytics to the complex world of medical coding and billing simplifies and automates the labor-intensive process of manual chart reviews. It also yields consistently objective findings to break down silos in healthcare organizations by comparing data from different departments to ensure consistency and identify communication breakdowns.

 “Smart Investment”

Healthcare provider organizations have been compelled in recent years to make “strategic investments” in projects that have strategic importance regardless of the cost or required effort with no direct ROI often because there is an inherent risk if you don’t do it.  Enterprise Resource Planning (ERP) and Electronic Medical Record systems (EMR) fit that description.  And then there are opportunities to place bets on investments big or small because they’re the smart thing to do financially – what we term “value investments”.  We now use Bubble Charts to analyze the various projects in a portfolio to visualize the balance between the value or profitability vs. the size of the required investment vs. the perceived risks involved… namely, how likely is it that we’ll achieve the expected returns, what are the risks of a runaway project that turns out costing 2 – 3 x what we budgeted, and what is the timeline of the project and when do we expect to recognize a return on our upfront investments.

Initiating a Revenue Assurance Program is one of those Smart “Value” investments because of the low barriers to entry, short time-to-value (as little as 60 days), high probability for success and significant financial returns with extremely low operating costs.  The best part of the decision, is that you can now address the elephant in the room and begin measuring and managing your revenue leakage.

About AcuStream

AcuStream is a Revenue Assurance specialty company dedicated to the healthcare industry. AcuStream provides automated charge capture auditing technology solutions, value-add professional coding expertise, and decision support tools to the country’s leading healthcare providers enabling our clients to find missed revenue around charges they didn’t know were missing. We are the only organization with proprietary algorithms and custom client specific rules, that can correlate both the hospital data and physician data. This in conjunction with our world class workflow, allows us to find and track missed, miscoded, and misplaced charges.

AcuStream identifies and quantifies missed reimbursable charges for both Physician Organizations and Health Systems. REVBUILDER™’s automated post-bill auditing solution identifies omitted charges while REVREVIEW™ auditors validate charges against your own EMR documentation and payer contracts to ensure you get paid for the services provided.

AcuStream has been privileged to work with one-third of the academic medical centers on the U.S. News and World Report “Honor Roll of Best Hospitals,” seven of the 50 largest integrated health systems, twenty percent of the 20 largest not-for-profit health systems, and 10 of the nation’s largest physician group practices providing immediate financial lift/profitability, management insights and process improvements surrounding Revenue Management.Acustream currently processes over 100,000 doctor’s data on a monthly basis, thanks to our client base of top hospitals and physician organizations in the US. The result of our solution is improved net profit, decreased revenue erosion, and a clear view into departmental efficiencies.

We help you identify the missing pieces to your revenue puzzle, BEFORE you even start to put the puzzle together.

19-crimes-poster

19 Crimes of Mid-Revenue Cycle Leakage

During the Industrial Revolution, Britain’s urban poor skyrocketed as did petty crime.

Throughout 1760-1820, the British court system created lists of crimes punishable by convict transportation to Australian penal colonies to reduce prison congestion (which was soaring) and commute death sentences.

Today, the plethora of Revenue Management vendor solutions has likewise overwhelmed Revenue Integrity professionals leaving them vulnerable to egregious crimes of omission in the fight against margin erosion.

AcuStream, Inc. has now published the following list of “19 Crimes of Mid-Revenue Cycle Leakage” punishable by declining profit margins, underperformance against revenue goals, and misalignment between hospitals and their key physician groups.

  1. Assuming margin compression will resolve itself… the structural changes brought about by the ACA have created a new normal and we have to act accordingly.
  2. Not actively managing a manageable aspect of Revenue Integrity – “Revenue Leakage” – and passively accepting HFMA’s estimate that 3-5% of reimbursable charges don’t get posted when a Six Sigma level of performance would be 10,000-fold improvement!
  3. Chasing revenue unicorns vs. taking a pragmatic approach to revenue optimization. There are very real and immediately addressable problems such as revenue leakage in front of us that we can and should tackle now.
  4. Trivializing revenue leakage or charge capture. Even 0.5 – 1% net income improvement is significant in the wake of an industry whose average profit margin is now <3%.
  5. Inflicting non-productive work on your coding teams in the form of random sample manual charge audits knowing technologic solutions are available that automate audits on 100% of all patient accounts leveraging thousands of rules with better accuracy and consistency.
  6. Blindly believing you have the requisite revenue assurance tools and an accountability culture in place today that specifically guard against leakage. Don’t assume you have either.
  7. Relying on your EMR as a revenue management tool. EMR’s are a system of record; not a tool of choice for managing revenue!
  8. Overemphasizing your CDM as a means for solving leakage. Cosmetic changes to your CDM as though leakage is a book-keeping issue is no substitute for multi-faceted, cross-functional operational PROCESS improvements.
  9. Mistaking Revenue Assurance as a “DIY” (Do it Yourself) opportunity. Outsourcing Revenue Assuranceactivities to an experienced partner with the requisite core competencies, cloud-based technologies and the ability to focus on a singular objective with greater economies of scale is the only cost-justifiable way to treat leakage.
  10. Assuming only pre-bill solutions can effectively solve your leakage woes. The multitude of tools and the resulting frenetic activities of your revenue team to get an initial bill out the door in 3 – 5 days with an industry average 10 – 13% error rate should be supplemented by a post-bill safety net to optimize billing accuracy.
  11. Not aligning HB with PB. You’re pursuing a corporate strategy that hinges on aligning your hospitals and physicians and, yet you still operate your physician billing and hospital billing teams as independent and separate functions.
  12. Allowing your physicians to lose RVUs today and compromise their future reimbursement due to MACRA physician payment adjustments. The size of these payment adjustments will partially depend on the data clinicians submit to CMS. Missing charges and RVUs create data integrity holes in the MIPS Quality Metrics.
  13. Not equipping your Single Business Office (SBO) with a single-vendor solution that covers PB, HB, inpatients and outpatients, and FFS/DRG payer accounts.
  14. Shortsighted thinking that your only lever to combat margin compression is cost reduction vs. revenue optimization.
  15. Looking at outsourced solutions as a cost vs. an opportunity. Worse, looking at revenue leakage defensively as an indictment of the proficiency of your Revenue Team vs. an opportunity to learn, grow and optimize.
  16. Assuming this is a long-term complicated decision-making process. It’s a simple, smart business decision so don’t over analyze it… time is money!
  17. Anticipating IT bandwidth to be a limiting factor that delays the launch of a Revenue Assurance Program. This is NOT an IT project; setting up the data extracts is merely a task in a very brief implementation.
  18. “Kicking the can down the road” by delaying the decision to confront revenue leakage. You can have a Revenue Assurance Program stood up and cash-flowing positive within 90 days with minimal investments of time or money.
  19. Not contacting AcuStream TODAY to start the process.

About AcuStream

AcuStream is a Revenue Assurance specialty company dedicated to the healthcare industry. AcuStream provides automated charge capture auditing technology solutions, value-add professional coding expertise, and decision support tools to the country’s leading healthcare providers enabling our clients to find missed revenue around charges they didn’t know were missing. We are the only organization with proprietary algorithms and custom client specific rules, that can correlate both the hospital data and physician data. This in conjunction with our world class workflow, allows us to find and track missed, miscoded, and misplaced charges.

AcuStream identifies and quantifies missed reimbursable charges for both Physician Organizations and Health Systems. REVBUILDER™’s automated post-bill auditing solution identifies omitted charges while REVREVIEW™ auditors validate charges against your own EMR documentation and payer contracts to ensure you get paid for the services provided.

AcuStream has been privileged to work with one-third of the academic medical centers on the U.S. News and World Report “Honor Roll of Best Hospitals,” seven of the 50 largest integrated health systems, twenty percent of the 20 largest not-for-profit health systems, and 10 of the nation’s largest physician group practices providing immediate financial lift/profitability, management insights and process improvements surrounding Revenue Management.Acustream currently processes over 100,000 doctor’s data on a monthly basis, thanks to our client base of top hospitals and physician organizations in the US. The result of our solution is improved net profit, decreased revenue erosion, and a clear view into departmental efficiencies.

We help you identify the missing pieces to your revenue puzzle, BEFORE you even start to put the puzzle together.

blindfolded

Take Off the Blindfolds… Start Aligning your Hospital and Physician Bills

You’re pursuing a corporate strategy that hinges on aligning your hospitals and physicians, you now employ hundreds of physicians, you’ve spent untold sums of money to have a community EMR, and you’re consolidating your business office.  Yet… you still operate your physician billing and hospital billing teams as independent and separate functions even though they’re addressing the same patient population during the same episode of care, sharing a common patient health record.  As crazy as that seems, that’s the current paradigm for most every U.S. healthcare system.

With technology now enabling the level of physician/hospital collaboration to meet the rising tide of healthcare consumerism, patients and payers expect health systems to present clear, concise and correct patient billing statements.  The public now expects more from providers in terms of price transparency than we demand of ourselves in terms of shared accountability for generating clean, complete and aligned patient bills.  Insulating Physician Billing (PB) and Hospital Billing (HB) teams from one another is a high-stakes, double-blinded experiment costing your organization precious time and money while eroding your margins and consumer confidence.  Now is the time to remove the Chinese wall separating your siloed billing functions by cross-pollinating your PB and HB information to optimize revenues across your enterprise.

Today, approximately 40% of U.S. physicians are employed by hospital systems.  The rise in Accountable Care Organizations and new alternative payment methodologies placing provider organizations at-risk for the quality and financing of health care along with the economic challenges (ex. MACRA) of operating independent physician practices will push this figure over 50% with a projected 14% increase in physician employment between 2014 – 2024.  With the investments made in recruiting, acquiring, managing and providing the technology tools for employed physicians along with the downward economic pressures on reimbursement, health systems must start innovating new ways of realizing the projected financial synergies their integrated delivery systems were designed to yield.

Revenue Assurance is a business activity utilizing data and process improvement methods to reduce revenue leakage thereby increasing profits, revenues and cash flows.  Leakage comes in the form of missed, miscoded or misplaced charges that leach out of your revenue funnel. Missed charges, as the term implies, are the simple omissions when a charge didn’t make its way to the patient’s bill.  Miscoded charges result from the normal variation of professional judgement involved in medical coding while Misplaced charges come from the fragmentation of our revenue cycle when we “park” charges in the various work queues within EMR systems awaiting further validation that potentially delays or prevents cash flow due to timely filing limitations if left unattended.  In growing numbers, Miscoded charges also result from disharmony in the way PB and HB teams independently code for professional and technical services.

In the fall of 2016, AcuStream, Inc., the market leader in Healthcare Revenue Assurance developed the industry’s first set of predictive business rules to detect misaligned PB and HB charges giving healthcare providers a next generation innovative solution to this problem.  Using similar algorithmic logic to that used by payers when reviewing/denying payment claims, AcuStream’s proprietary rules logic has produced the following results.  On average, rules leveraging the HB/PB matching logic produced >30% of the total Revenue Assurance predictions ranging anywhere from 15% – 80% of the total predictions for individual clients performing Revenue Assurance activities across both their HB and PB organizations!   Depending on the size of your organization, HB/PB matching logic can add millions to your net income and basis points to your profit margin.

For organizations looking to attack leakage and combat margin erosion, Revenue Assurance represents the low-hanging fruit of revenue optimization and a quick, certain way to shore up your revenue integrity function in a matter of weeks.  It will also provide you the ability to share billing/coding information allowing your revenue teams to see each other’s work, share their insights, and improve billing accuracy.  It’s time to remove the blinders and see the new possibilities for aligning financially across your hospital and physician organizations.

About AcuStream

AcuStream is a Revenue Assurance specialty company dedicated to the healthcare industry. AcuStream provides automated charge capture auditing technology solutions, value-add professional coding expertise, and decision support tools to the country’s leading healthcare providers enabling our clients to find missed revenue around charges they didn’t know were missing. We are the only organization with proprietary algorithms and custom client specific rules, that can correlate both the hospital data and physician data. This in conjunction with our world class workflow, allows us to find and track missed, miscoded, and misplaced charges.

AcuStream identifies and quantifies missed reimbursable charges for both Physician Organizations and Health Systems. REVBUILDER™’s automated post-bill auditing solution identifies omitted charges while REVREVIEW™ auditors validate charges against your own EMR documentation and payer contracts to ensure you get paid for the services provided.

AcuStream has been privileged to work with one-third of the academic medical centers on the U.S. News and World Report “Honor Roll of Best Hospitals,” seven of the 50 largest integrated health systems, twenty percent of the 20 largest not-for-profit health systems, and 10 of the nation’s largest physician group practices providing immediate financial lift/profitability, management insights and process improvements surrounding Revenue Management.Acustream currently processes over 100,000 doctor’s data on a monthly basis, thanks to our client base of top hospitals and physician organizations in the US. The result of our solution is improved net profit, decreased revenue erosion, and a clear view into departmental efficiencies.

We help you identify the missing pieces to your revenue puzzle, BEFORE you even start to put the puzzle together.

papercut

The Five Things You Should Start and Stop Doing Now to Solve your Revenue Leakage Problem

Revenue leakage is a very real concern for Healthcare providers costing hospitals and physician organizations billions of dollars each year in squandered net patient revenues!  Left unchecked, your profit margins suffer a slow ‘death by a thousand paper cuts’ as your organization incurs the cost of patient care delivered without the offsetting reimbursement.

In today’s highly competitive yet uncertain healthcare landscape, margin compression is a threat to financial sustainability. And yet, providers are letting their hard-earned revenue slip through the cracks of their revenue funnel at alarming rates.  Detecting and patching those leaks can provide immediate financial relief and lead to long-term process improvements.   Here then are the five things every provider organization should start doing – as well as the five things they should stop doing – to optimize revenue and avert leakage.

Five things to STOP Doing:

To carve out the bandwidth needed to attack leakage, it’s just as important to define the things you’re going to stop doing to afford your Revenue team the time to tackle the items you want them to start doing.   Practicing the ‘discipline of removal’ reduces the amount of time people waste, and in effect, refocuses their efforts and energy on achieving revenue results.

  1. Stop ignoring the elephant in your Revenue Cycle Room

Optimizing revenue is a two-fold solution.  You need to mitigate the “friction” in your revenue cycle operations to optimize efficiency and you need to restore volume to your revenue funnel by addressing leakage.  To truly manage leakage, you need information and assigned accountability.  Don’t assume you have either.

  1. Stop assuming your EMR is the silver bullet for Revenue Management

EMRs are the source-of-truth but not the tool-of-choice for managing revenue.  Like all enterprise systems, EMRs are too unwieldy to provide end-users or Revenue Cycle leaders ready access to granular, actionable leakage analytics and EMR IT resource constraints are a bottleneck for custom reporting.  As such, provider organizations must look to niche vendor solutions that can play off the EMR data to provide value-add analytics without taxing your already limited IT resources.

  1. Stop thinking you can fix leakage by overemphasizing your CDM

CDM management and charge auditing are separate, interrelated work streams; not interdependencies!  If you ran a retail store where you had 3% inventory shrinkage, you wouldn’t assume you could solve for wastage or theft via a price adjustment. Even if you chose to raise your prices 3% to offset leakage (something not easily done in healthcare), you’d only be masking the underlying problems.   Stop treating mid-revenue cycle leakage as though it is a book-keeping issue, it’s a multi-faceted operational process problem.

  1. Stop thinking you have the scale to ‘do it yourself’

You don’t hire full-time nurses to accommodate peak census levels and you don’t set your floor stock supply inventory levels for maximum demand either so why would you add staff to your revenue integrity department to go after the small percentage of patient charges leaching out of your system?  Outsourcing Revenue Assurance activities to an experienced partner with the requisite core competencies, cloud-based technologies and the ability to focus on a singular objective with greater economies of scale is the only cost-justifiable way to treat leakage.

  1. Stop looking at leakage auditing as purely a pre-bill function

HFMA’s Patient Friendly Billing guidelines call for providers to deliver clear, concise and correct billing information yet we rush to get out initial statements with 10 – 13% error rates by cramming an overwhelming amount of frenetic activity for revenue teams into the first 3-5 days post discharge.  Best practices call for identifying revenue leakage both pre- and post-bill to optimize charge capture.  Putting all your charge auditing eggs in one pre-bill basket at a time when you know your team is distracted and under pressure exposes you to significant financial risk.

Five thinks to START Doing:

Once you’ve freed your organizational mindset from these outdated ideologies, it’s time to champion the cause for revenue integrity!

  1. Start getting serious by attacking the problem

HFMA estimates 3 – 5% of charges never get posted which means the industry’s revenue defect rate is 10,000 times greater than a Six Sigma level of performance!  Active vs. passive leakage management is a worthy investment with a seven-figure net income impact and double-digit returns on your investment.  Don’t be passive, get focused by assigning a business owner, establishing goals and monitoring progress.  Leakage won’t solve itself; it requires leadership, structure and proper tooling to make it happen.

  1. Start aligning your Physician and Hospital Billing functions

Your corporate strategy is to align your hospitals and physicians, you’ve spent untold sums of money to have a community EMR, and you’re consolidating your business office but yet you still operate your physician billing and hospital billing teams as independent and separate functions even though they’re addressing the same episode of patient care.  Now is the time to remove the Chinese wall and break down these silos by sharing billing information.  A Revenue Assurance Program that cross-pollinates PB and HB information presents an innovative opportunity for revenue enhancement across your enterprise.

  1. Start taking the emotion (and defensiveness) out of the equation

Tracing the root causes of revenue leakage should not be a rascal hunt.  More often, leakage results from systemic process problems, obsolete business policies and/or technology gaps than human error.  Treat the management of revenue leakage as a data-driven/fact-based opportunity to learn and develop your staff.  Consider gamification strategies to encourage proactive employee engagement.

  1. Start approaching revenue assurance activities as an investment, not a cost

Recouping incremental revenue for the patient care you’ve already delivered converts directly into net income.  In fact, accretive revenue is more valuable than an equal % of variable expense reduction and can stave off the need for emergent spending cutbacks.  The operating margins on a Revenue Assurance Program are considerably higher and more predictable (shorter time-to-value, too) than front- and back-end revenue cycle management initiatives so it’s a smart and safe investment.

  1. Start looking for a partner vs a vendor

Charge capture auditing tools (i.e., technology solutions) alone can create mayhem for coding teams.  In isolation, automated predictions are prone to generating 50% or more “false positives” that erode the confidence and productivity of coders, who, in effect, are tasked to find needles in the haystack.  A value-add outsourced service that cleanses the predictions before they’re presented to your revenue team transforms the technology tool into a true solution.  If your charge capture vendor is heaping more complexity than value on your haystacks, offering only theoretic predictions vs. reconciling actual revenue recovery to the penny, and is charging you a flat subscription fee that has diminishing returns as you solve your leakage problems, it’s time to reassess the financial and productivity impact of that relationship and evaluate other options.

 About AcuStream

AcuStream is a Revenue Assurance specialty company dedicated to the healthcare industry. AcuStream provides automated charge capture auditing technology solutions, value-add professional coding expertise, and decision support tools to the country’s leading healthcare providers enabling our clients to find missed revenue around charges they didn’t know were missing. We are the only organization with proprietary algorithms and custom client specific rules, that can correlate both the hospital data and physician data. This in conjunction with our world class workflow, allows us to find and track missed, miscoded, and misplaced charges.

AcuStream identifies and quantifies missed reimbursable charges for both Physician Organizations and Health Systems. REVBUILDER™’s automated post-bill auditing solution identifies omitted charges while REVREVIEW™ auditors validate charges against your own EMR documentation and payer contracts to ensure you get paid for the services provided.

AcuStream has been privileged to work with one-third of the academic medical centers on the U.S. News and World Report “Honor Roll of Best Hospitals,” seven of the 50 largest integrated health systems, twenty percent of the 20 largest not-for-profit health systems, and 10 of the nation’s largest physician group practices providing immediate financial lift/profitability, management insights and process improvements surrounding Revenue Management.Acustream currently processes over 100,000 doctor’s data on a monthly basis, thanks to our client base of top hospitals and physician organizations in the US. The result of our solution is improved net profit, decreased revenue erosion, and a clear view into departmental efficiencies.

We help you identify the missing pieces to your revenue puzzle, BEFORE you even start to put the puzzle together.

money-drain

Healthcare Revenue Assurance… The Deming Way

Edwards Deming is widely acknowledged as the leading management thinker in the field of quality. He was a statistician and business consultant whose methods helped hasten Japan’s recovery after World War II and later he was instrumental in bringing total quality management to the U.S. auto industry. While Deming is most renowned for applying quality management to manufacturing, his approaches have since been applied across all industries and business functions including healthcare revenue cycle management.

The Healthcare Financial Management Association (HFMA) defines revenue cycle management as “all administrative and clinical functions that contribute to the capture, management, and collection of patient service revenue.”  In other words, RCM spans the entire life of a patient account from creation to payment. The objective of RCM is to streamline processes allowing charges to flow through to revenue with minimal friction.

Revenue Assurance is a Revenue Mid-Cycle charge capture function that identifies missed, misplaced or miscoded charges that have leaked out of the RCM work stream.  Revenue Assurance’s focus is to recognize how, when and where leakage occurs and return charges to the top of the RCM funnel. HFMA estimates that 3 – 5% of all patient charges are never posted which in manufacturing terms would be considered “waste”.  Applying Deming’s Total Quality Management approach to RCM, Revenue Management professionals own the responsibility for capturing all patient charges by minimizing the waste of missed, misplaced or miscoded charges.

The implied charter of any Revenue Cycle Management or Revenue Integrity team is to “optimize” the company’s revenues consistent with the patient care services that are delivered.  In other words, to get paid for all the patient care that has been delivered.  To only collect “some of the revenue” and disregard the “waste” of missed charges is a disservice to our caregivers and falls short of our fiduciary responsibilities to properly manage the company’s revenue stream.  RCM and RA are complementary and essential functions that must be architected into the Total Quality Management of revenue because Revenue Cycle Management without Revenue Assurance ≠ optimization.

Six Sigma

Deming’s Total Quality Management approach and statistical concepts later lead to Lean Management and Six Sigma quality management methodologies that are now common place across the healthcare industry. Six Sigma is a disciplined, data-driven approach and methodology for eliminating defects, driving toward six standard deviations of the mean at which an organization would be performing at 3.4 defects per million opportunities.  If HFMA’s estimated 3 – 5% of charges never posted rings true, we’re looking at a Revenue Management defect rate as much as 10,000 times greater than expected at a Six Sigma level!

On the path to Six Sigma performance levels, it is common practice for companies to set targets related to the achievement of a “sigma level” or a “10-fold improvement”.  Assuming HFMA’s high-end estimated 5% charge capture defect rate, a 10-fold improvement would yield a 99.5% charge capture accuracy target; a goal readily achievable via a Revenue Assurance Program.

The revenue recouped through Revenue Assurance goes directly to a company’s net income and has the potential to add percentage points to a provider organization’s profit margin since the expense of patient care has already hit your books.  More importantly, the ability to identify the who, what, where, when and why of revenue leakage allows you to patch holes in your charge capture processes and make permanent fixes that will pay long-term dividends.  Deming would remind us all that the ability to measure leakage is the critical initial step in being able to manage waste out of your system.

Data Rich Info Poor

Mid Revenue Cycle Leakage… What You Don’t Measure, You Can’t Manage

Since the 2009 passage of the American Recovery and Reinvestment Act (ARRA) and the corresponding HITECH Act, the adoption of Enterprise Electronic Health Records (EHR) has become main stream among America’s leading health systems.  Government funding for EHR adoption touted the promise of better patient care coordination, disease management, reduced medical errors and increased productivity while also providing the technical underpinnings to support essential business processes such as Revenue Cycle Management (RCM) to unify all the administrative and clinical functions that contribute to the capture, management and collection of patient service revenue. As the documentation intermediary between the delivery of patient care and the resulting patient service revenue, EHRs are critical to managing the Mid Revenue Cycle (MRC) which is defined as the phase between patient access and the care provider’s business office where care delivery, clinical documentation, charge capture and coding occurs.

While RCM has historically focused on process inefficiencies to reduce the friction and expedite the flow of charges through the Revenue Cycle, EHR adoption has enabled an increased focus on charge capture and the data analytics that identify and avert revenue leakage enabling providers to turn waste into wealth.  In an industry that is renowned for being “data rich but information poor”, there is increasing evidence that shows we have a paucity of data AND information aimed at Mid-Revenue Cycle leakage that is not being addressed by your EHR.

To that point, PwC’s Health Industries Advisory Group recently presented best practice recommendations with a specific focus on Revenue Cycle Management challenges and financial implications of an Epic EMR conversion.  PwC LeakageTheir findings suggested that the sophistication and complexity of an EMR is fraught with opportunities for revenue leakage and EMR reporting capabilities are less than helpful in identifying, quantifying and resolving leakage.  The use of static reports is seldom “actionable” meaning that it is simply information for the sake of information with a wide chasm between the presentation of data and enacting process improvements. Specifically, ad hoc reports lack in their ability to trace the root causes for revenue leakage and the required actions needed to solve it.  PwC further remarked that the summarized reporting lacks the ability to drill down to detailed findings via the aggregated views which inhibits users’ ability to isolate leakage, compare leakage across locations, specialties, departments or physicians.  Simply put, EMRs are just too big and unwieldy to provide end-users or Revenue Cycle leaders the granular analytics needed to provide insights and take action.

The opportunity cost of not managing Mid Revenue Cycle leakage is highly significant.  PwC Leakage2While charge capture will always be vulnerable to human error, systemic leakage (i.e., process inadequacies that cause recurrent problems) and technology gaps are far more devastating.  Case-in-point, PwC highlights the experience of an 800-bed Academic Medical Center which, by their estimate, had leaked $66M in revenue in just the first 45 days post-go-live!  Similar phenomena occurs with every EHR upgrade as well as all the upgrades, patches, etc. that accompany the peripheral systems that are integrated or feed information back into the EHR.  This represents dozens of technology-related points of failure annually for a health system.

Peter Drucker’s adage “if you can’t measure it, you can’t improve it” has been morphed over the years into “you can’t manage what you don’t measure”.  In that regard, Mid Revenue Cycle leakage has been the forgotten soldier in the war on revenue.

Many healthcare organizations ASSUME that somewhere in their Accounts Receivable report packages they must be collecting revenue leakage performance metrics and therefore it’s just a matter of mining the data they’re currently collecting. Think you’re one of them?  Ask yourself these three questions that serve as a litmus test regarding your ability to measure and manage leakage…

  1. Do you believe your organization incurs leakage? If so…
  2. Can you accurately identify where the leakage occurs (i.e., by location, department, specialty area or practitioner) and quantify its financial impact?
  3. Do you have an accountability structure within your Revenue Integrity area that has a defined “owner” responsible for managing leakage and the resulting financial results and process improvements?

Honest answers to the above questions will tell you whether you have a problem worth solving, whether you have the means for measuring the problem, establishing goals and tracking performance, and whether you have an accountability culture specific to revenue leakage.

PwC Leakage 3

PwC highlighted three critical success factors for Revenue Cycle professionals to consider pre- and post-implementation of an Epic EMR – (1) understand the key differences and considerations around the migration from a legacy system to Epic’s EMR, (2) look for process improvement opportunities post-go-live, and (3) acknowledge the need for value-add next gen analytics to lend revenue integrity insights. Opportunities to specifically mitigate Mid Revenue Cycle leakage include…

  1. Work Queue Management – Epic Work Queues tend to fragment the RC workflow and disperse accounts into multiple silos that if unmanaged, eventually lead to revenue leakage due to Timely Filing limits.  Without a revenue assurance program that is constantly monitoring leakage, hospitals will incur leakage due to “misplaced” charges.
  2. Charge Volume Monitoring – Charge integrity is compromised in every EHR conversion and the ensuing charge leakage spikes from pre- to post-implementation.  This is the predictable surprise that coincides with every EHR conversion AND each and every EHR upgrade.  Pre/post volume alignment reviews are largely designed as a check and balance to detect technology gaps associated with the conversion but they don’t provide the specificity to identify the root causes of the systemic leakage, pin-point where the problems are occurring and make NO EFFORT to track and recoup the associated revenue.
  1. Business Intelligence – EHRs do not provide RCM-specific standard reports and custom EHR reporting is challenging as well as expensive. Third party RC Analytics from niche solution providers can add new, advanced insights that provide the depth and breadth of analytics that EHR reporting simply does not deliver.   PwC suggested that providers strongly consider bolt-on technologies that drive new business intelligence insights and data-driven problem solving.

RCM analytics is a relatively new Business Intelligence frontier and as a result, RCM data analytics are relatively low in adoption amongst healthcare providers.  A recent survey by Navicure noted that  55% of respondents did not have an RCM reporting solution yet 45% were actively looking for one.  Chief concerns amongst respondents in leveraging analytics showed that while resources availability was their top concern, 44% felt they lacked in benchmark information and actionable information that is readily usable.  In short, the results imply that customers want concise, actionable information with benchmarks for what good looks like without a lot of time, effort, or resources committed to data mining.

All indications point to the fact that EHR solutions do not provide the native reporting capabilities required to manage MRC effectively and each conversion/upgrade is a slippery technology slope prone to incurring significant revenue leakage.  Leading health systems have recently reported budgeting for 1-2% dip in annual revenue associated with their EMR conversions.   Niche solution providers such as AcuStream and its Revenue Assurance Program are rapidly gaining market acceptance as essential bolt-on technologies and services in the war on revenue leakage as complements to both EHR solutions and Revenue Cycle Management best practices process efficiencies providing health systems with the specific ability to measure, manage and recover revenue leakage.

About AcuStream

AcuStream is a Revenue Assurance specialty company dedicated to the healthcare industry. AcuStream provides automated charge capture auditing technology solutions, value-add professional coding expertise, and decision support tools to the country’s leading healthcare providers enabling our clients to find missed revenue around charges they didn’t know were missing. We are the only organization with proprietary algorithms and custom client specific rules, that can correlate both the hospital data and physician data. This in conjunction with our world class workflow, allows us to find and track missed, miscoded, and misplaced charges.

AcuStream identifies and quantifies missed reimbursable charges for both Physician Organizations and Health Systems. REVBUILDER™’s automated post-bill auditing solution identifies omitted charges while REVREVIEW™ auditors validate charges against your own EMR documentation and payer contracts to ensure you get paid for the services provided.

AcuStream has been privileged to work with one-third of the academic medical centers on the U.S. News and World Report “Honor Roll of Best Hospitals,” seven of the 50 largest integrated health systems, twenty percent of the 20 largest not-for-profit health systems, and 10 of the nation’s largest physician group practices providing immediate financial lift/profitability, management insights and process improvements surrounding Revenue Management.Acustream currently processes over 100,000 doctor’s data on a monthly basis, thanks to our client base of top hospitals and physician organizations in the US. The result of our solution is improved net profit, decreased revenue erosion, and a clear view into departmental efficiencies.

We help you identify the missing pieces to your revenue puzzle, BEFORE you even start to put the puzzle together.