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HFMA Utah Chapter

Fall Meeting “Benchmark Comparisons” September 2007. HFMA Utah Chapter. Preview. Definitions Characteristics of participants Comparative Graphs Successes Conclusions Next Steps. Introductions. re|solution Revenue cycle

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HFMA Utah Chapter

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  1. Fall Meeting “Benchmark Comparisons” September 2007 HFMA Utah Chapter

  2. Preview • Definitions • Characteristics of participants • Comparative Graphs • Successes • Conclusions • Next Steps

  3. Introductions • re|solution • Revenue cycle • AR clean up, management training, interim staffing, chargemaster reviews, revenue cycle assessments, payment reviews, APC performance improvement plans and self-pay management plans • Mike Ronning • Vice President, Client Services of re|solution • Over 20 years of administrative, revenue cycle, managed care contracting, and operations experience

  4. Quiz #1 The Acid-Test Ratio is: • The amount of hydrochloric acid needed to burn through to the “real” numbers in your financial statements • The amount of LSD that must be ingested by Finance Committee members before your financial reports start looking good • A stringent test that indicates if your facility has enough short-term assets to cover current liabilities

  5. Definitions, Process, and Benchmarks • Submission of data • Best Practices • HARA and Zimmerman • Peer Groups

  6. Reporting Package Elements • Benchmark Indicator Analysis • Input data sheet – who, what and when • Graph comparing peer group and best practice for six indicators • Opportunity analysis • APC analysis • Group Analysis • Blinded report • Confidentiality • Scrambled A-?

  7. Participants

  8. Gross Days in AR • Measures the general effectiveness of the Business Office in liquidating A/R • Days in DNFB vs. Days in Billed A/R • Gross vs. net • Days in A/R by financial class • Easily manipulated by write-offs • Must be reviewed with other benchmarks • Trend internally and externally • Standard—varies by bed size, geographic region, hospital type, payer mix, etc. • Success stories?

  9. Cost to Collect • Bottom line impact • Opportunity to invest in front end technology • Factors that affect this number in reporting • Admissions, billing and collecting costs • Outside vendors • Cost of technology • Key indicator of business office effectiveness • Standard—$.03 per dollar or less

  10. Bad Debt and Charity Write Offs • Must be considered in light of hospital mission and community expectations • Policies can dictate this number • Patient responsibility impact • Reasons for high number • Local/regional economics • Credit/collections and charity policy • Payer mix • Experience of staff • Technology in the B.O. • Effectiveness of early out and primary bad debt collection agencies • Timely filing issues, lack of pre-registration program, lack of self pay management program. • Standard—will vary from hospital to hospital and geographic region. HARA—5% or less • Successes?

  11. Days in A/R are up, cash is down, and your capital budget was just slashed by 30%, but it could be worse…

  12. AR over 90 days • Key indicator for effective follow up • Is DNFB included in current or 0-30 aging bucket? If so, the percentage of billed A/R greater than 90 days will be understated • Look at makeup • Over 365 • Any Medicare or Medicaid • How much in self pay • Greatest cash acceleration opportunity • Focus on largest dollars per collector (80/20 rule) and quick wins • Standard—no more than 20% of total billed A/R over 90 days. Best practice—15% to 18% • Successes?

  13. DNFB • Another opportunity for cash acceleration • Components—inhouse, suspense, accounts requiring coding beyond suspense days, billing processing • Find the root cause • Potential solutions • Fix the system • Periodic super coders • Monitor top ten • Regular meetings between admissions, medical records and business office • Standard—Six (6) days or less including suspense days • Successs?

  14. Quiz #2 APC stands for: • Another Payment Catastrophe • Almost Paid Correctly • Annual Payment Cut • Ambulatory Payment Classification

  15. Are you getting paid for the services you provide? • APC Medpar analysis • Chargemaster review • ER acuity level and E/M review • Outpatient charge capture review • Reimbursement review • All can improve your bottom line

  16. Next Steps • Review the data at facility • Determine action plan to improve numbers – set goals • Comparison to another facility will be brokered by re|solution • Consider whether you want to attack the opportunities • Individual BIA discussions will be set up as needed

  17. Questions

  18. Mike Ronning 800-355-0410 mike@ereso.com

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