WVU Healthcare Revenue Recovery WVU Hospital – Berkeley Medical Center – Jefferson Memorial

1. WVU Healthcare Revenue RecoveryWVU Hospital – Berkeley Medical Center – Jefferson Memorial September 25, 2014

2. Overview • Risks for cash loss within the revenue cycle • Our solution • Our progress so far • External Validation • Plans for the Future

3. Risk for Cash Loss • Denials • Uninsured population • Self pay liquidation • Time value of money (Days in AR) • Commercial contract rates/reimbursement • Unidentified and unmeasured reimbursement loss for commercial and government short pays

4. Gross Revenue  Cash

5. Gross Revenue  Cash *WVUH Data

6. What is contributing to loss? • Mix differences in population • A few high dollar or complex cases • Payer behavior/payment policies • Bundling, multiple procedure reductions • Payment variances

7. Payment Variances • Two types of payment variances: • Underpayments – Payment variances (short pays) identified through regular staff workflows. Follow up or denials staff may need assistance getting positive resolution. • Zero Balance – Payment variances that have adjusted to zero balance through the regular account workflow. These accounts are no longer in any staff work flows and are considered closed.

8. Our Solution • Developed a “Contracts Team” to help to limit losses due to payment variances. • Existing analyst who did contracts programming. Added a manager position and an additional resource for the East. • Where analyst previously focused on contract programming only, added the payment validation piece for both system calculation and items that the system was unable to catch.

9. Contracts Team Design • Manager, Systems & Contracts (9/2012) • Background in contracting, contract programming, and reimbursement validation • Decision Support Analysts (10/2012, 4/2013) • Contract modeling in EPIC • Development and maintenance of Excel model tools • Design and monitoring of reimbursement reporting • Communication of payer issues and resolution through payer representatives • Resource for Staff on reimbursement issues • Insurance Claims Specialist • Account documentation, variance workqueue review • Follow up on identified underpayments to resolution

10. Progress So Far…

11. Payment Validation Cycle • Contractual Adjustment posts at time of bill submission • Payments posts against expected reimbursement • Payment variances created for review • Follow up with a payor on underpayments or review contract programming and update system calculation parameters

12. Contract Programming • Goals and Status • 100% Programmed: We still have things that we cannot program in EPIC - OPPS and other complex contract terms. • 100% Accuracy: We continue to work on accuracy. The more accurate the calculation is, the more the follow up staff will trust the calculation and be less likely to override it. Accurate calculations also reduce accounts in staff work flows. • 100% Trust: With training and through communication, the follow up staff have a high level of trust in the EPIC calculation. This will only improve as more contracts are programmed.

13. Process Improvement • System programming, process updates, and staff training are provided to improve collection at the correct rates during the initial collection process. • Edits and Billing processes are added or updated when we find trends in underpaid claims. • Updated Tools on Sharepoint to calculate expected for contract terms not built in Epic – OPPS • Staff Training is provided for all new employees on reviewing claims for the CORRECT expected payment to improve follow up efforts.

14. Process Improvement Process improvements have significantly reduced some high dollar zero balance issues.

15. Staff Pricing Tools

16. 2014 Initiative – Medicaid Expansion • Outpatient Medicaid Programming • Implemented in February 2014 – more accurate A/R Days • Although Medicaid claim volume was up 45% from January to June - Staff work flow volumes were declined with this additional programming. • By April 2014 - Increased Variance follow up by 700% • Work with the Managed Care Medicaid payors to pay consistent with WV Medicaid. By July 31st we saw a 21% reduction in variance volume.

17. Collaboration With Payors • WV Medicaid - Collaboration • BMS provided reports identifying unpublished rates to support current payment methodology. • Communicated information with the MC Medicaid and Other “Like Medicaid” payors to increase correct payments • Examples of Issues Identified: • Vaccines being reimbursed at old rates • J Codes not being reimbursed by MC Medicaid per BMS • Q and A codes not published

18. Non-Systematic Reviews • Non-automated Reviews include: • Transfer Discharge Disposition • Complex pricing terms – BMT • Payor Electronic Remit Posting Errors • CO45 = Total Charges • Low Percentage Pays – Claims paying less than 10% of charges • Drugs approved by the FDA with Retro-Effective Dates

19. External Validation • Engaged external firm who specializes in zero balance review to audit our process • 99.8% Accuracy Rate • Highest Risk Payers • Most complex payment structures – Most Difficult to monitor • Highest Risk Processes • EPIC contract terms unable to calculate reimbursement • Coding/Billing Opportunities • WV Medicaid Blood Transfusions pay per 15 min • Coding review of combines accounts

20. Review Findings by Type of Error

21. Measuring Success • How do we measure our Financial position? • Contracting focus on “Negotiated Discount” • Hospital finance focus on “Net Revenue” • PFS focus on “Cash” and account resolution

22. Cash Compared to Net Revenue *WVUH Data

23. Plans for the Future • Continue to program contract terms into the system: • 2015 Initiative – OPPS programming and underpayment identification • Exploration of programming other complex terms such as Bone Marrow Transplant case rates • Validate staffing levels in the Contracts Team to ensure continuous quality monitoring • Continue with external validation of internal process • Less manual quality auditing of pricing accuracy