1. EMERGING TRENDS IN REVENUECYCLE MANAGEMENT Presented byDavid Nordella HSM 571 – Clinical and Financial Management Department of Health Services ManagementUniversity of La Verne James Peelgren InstructorFall TermNovember 6, 2010

2. Presentation Overview History of Revenue Cycle Management (RCM) Changing Definition of RCM Goals of new RCM Motivations for changes in RCM Improvements in hospital processes Implementation Benefits Impact on employees Summary Questions

3. Tedious manual labor Patient discharged Pre-bill Editing, Billing Work-list for editing Claim generated Claim logged into the general ledger Electronic claim file produced Edited claim is sent to a clearinghouse Paper report for rejected claim Corrections made for remittance Claim is resubmitted Collection and posting of payment

4. Changing Definition Previous definition concentrated on the back-end of the cycle and correcting discrepancies caused by problems in the front-end “All administrative and clinical functions that can contribute to the capture, management and collection of patient service revenue “, Healthcare Financial Management Association

5. Motivations for changes in RCM practices Labor is expensive Demands from payers for coding and documentation increased with costs Unsustainable and rising increases in U.S expenditures as a % of the Gross Domestic Product Demographics are driving growth in use Improving net collections and prompt payments improve cash flow Use of technology can improve collection of unrecovered amounts by large %

6. Goals of emerging RCM Generate charges from Computerized Physician Order Entry (CPOE) Automated performance with bi-directional feeds Positive patient experience from registration through payment Increased physician and nursing productivity Co-ordination of payment processing with payers Advance Beneficiary Notice (ABN) “Connected patient “ with administrative support Use of Enterprise Patient Index (EPI) for unique identifiers

7. Improvements in hospital processes Dashboard access to RT data Powerful analytic tools for management Rules-driven workflow with management by exception Single database Integrated solution with capacity for bolt-ons Reduction of system complexity (user friendly) Manual tasks frequently reviewed for conversion to automation Low cost of ownership Improvements in other services

8. Implementation Strategic review Team process with integrated clinical and business teams. Shared responsibilities No “silo” perspectives Processes>personnel>technology

9. Key Performance Indicators (KPI) Implementation of Data Marts for high level data Beware of acronyms –what is ROI? “Ideal” solution should be mapped “Pragmatic” solution should be mapped for fallback if resources are limited Maps reviewed Maps finalized Maps distributed Results measured by metrics Reapply process

10. Benefits Co-ordination with payers reduces claims, reduces administrative expenses, improves cash flow Knowledge of criteria for prompt payments Reduction of coding errors that produce denials Easier collection of denials when an error is made by payer Easier distribution of work when an error is identified by payer Demonstration of goodwill by identifying over-payments as well as under-payments

11. Benefits (continued) Easier audits of denials Earlier recognition of Present on Admission (POA) for reduction of Re-Admissions Added protection against Recovery Audit Contractors compensated on contingency by Centers foe Medicare & Medicaid Service (CMS) Proper RCM will complement the transition to ICD-10-CM Higher employee morale from respect for career, education, compensation

12. Summary Improve cash flow- reduction of denials, decreasing bad debt, prompt payments and postings Computerized manual tasks under rule-driven work by exception Reduction of system complexity Improves high-level review of structures and activity Promotes transformative care by assembling all patient documents and data Aligns the interests of patient, hospital, payers, Medicare Complements rather than compete with other technology initiatives

13. Questions?

14. Contact David Nordella 805.991.6001 dnordella@sbcglobal.net