breakthrough denials performance: leveraging analytics and ......leveraging analytics and optimizing...
Post on 06-Jul-2020
7 Views
Preview:
TRANSCRIPT
2/20/2017
1
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM
Breakthrough Denials Performance: Leveraging Analytics and Optimizing Upfront Success
HFMA Conference
February 2017
Revenue Cycle Solutions
The best practices are the ones that work for you.
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM
2
3
4
1
Road Map for Discussion
Denials Management State of the Union
Traits of a Best in Class Denials Program
Case Studies and Next Steps
Revenue Cycle Solutions at Advisory Board
2/20/2017
2
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 3
About the Speakers
Ben Beadle-Ryby
Partner
202.266.5323
beadleb@advisory.com
For more information, contact:
Joy Houk-Raper
Vice President
615-983-4027
HoukrapJ@advisory.com
For more information, contact:
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 4
Optimizing Revenue Cycle Performance
Representative Membership
• CHI St. Luke’s Health, Houston, TX
• The Cleveland Clinic, Cleveland, OH
• Mayo Clinic, Rochester, MN
• Memorial Hermann, Houston, TX
• Mountain States Health Alliance, Johnson City, TN
• Orlando Regional Medical Center, Orlando, FL
• Trinity Health, Livonia, MI
• Universal Health Services, King of Prussia, PA
• SSM Healthcare, St. Louis, MO
• Providence Health & Services, Renton, WA
Deep bench of the industry’s most seasoned experts combining Advisory Board research with real-world know-how to drive lasting gains in revenue cycle performance
Analytics and workflow tools to improve revenue cycle performance; integrated approach delivers results by combining actionable insights with dedicated advising and extensive implementation resources to maximize contract yield, revenue capture and collectionsStrategic guidance, best practices and forecasters to address the most critical concerns facing finance and revenue cycle executives and their teams. Special focus on patient access, documentation and coding, business office effectiveness and contract modeling and management.
Comprehensive & Integrated Capabilities
Research & InsightsFinancial Leadership Council
Consulting
Performance Technology
1,700+
Hospitals participating
Revenue cycle professionals on staff
350+
$3BDocumented revenue enhancement
Extensive Expertise and Results
2/20/2017
3
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 5
Combined Forces Undermining Revenue Cycle Success
Shifting Business ModelsSilos Preventing Cohesion
• Value-based contracting putting downward pressure on reimbursement
• Critical to be highly successful in Fee-for-Service models
• Over $14M annually left on the table for an average 250-bed hospital
• Functional disparities make it impossible to pinpoint payment blockages
• Today’s denials require cross-functional coordination to root cause and resolve or appeal
• The spending gap doubled between high and low quartiles since 2013
Causing InefficiencyReducing Yield$8M -$16M
Incremental cost to collect
2 - 5%
Missed net revenue
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM
6
Cracks in the Foundation – Initial Denials Are Spiking
42% 42%
50%
2011 2013 2015
Commercial Denials Spiking
Final Commercial Denials as a Percentage of
Total Final Denials
6% CAGR
70%Best possible appeal success rate against commercial denials in 2015. Even top-performing organizations wrote off 30% of denials.
Denial Recovery is Not Enough
2/20/2017
4
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 7
Components of Strong Denials Infrastructure No Longer Sufficient
Existing Denials Forums
Multiple focus groups have been meeting to review denial detail for
years.
Investment in Enhanced Denials Data
Expansion of Patient Accounting Systems reports to provide better
denials visibility.
Engaged Leadership
Leadership understands the importance of shifting focus from
denials appeals to denials prevention.
Low Write-Offs
Strong appeal overturn rates and historically has kept write-offs to a
minimum.
$
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 8
Highlighting Common Challenges for Preventing and Managing Denials
• Multiple denials reporting sources (Initial Denials Spreadsheet, excel reports, EHR reports, vendor reports)
• Inconsistent terminology and denials definitions
• Lack of awareness on denials from front line staff upstream in revenue cycle
• Cross departmental coordination is inefficient or non-existent
• Limited denial reason grouping capabilities
• Inability to quickly develop graphs for specific departments and stakeholders
• Lack of visibility into targets and performance thresholds for specific functions
• Delayed data feeds only allow for monthly visibility into progress against goals
CURRENT CHALLENGES
2/20/2017
5
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 9
Defining Initial Denials and Final Write-offs
Onsite discussions surfaced the need to provide organization-wide education on the definitions and nuances of denials. An immediate step is to align key stakeholders by speaking the same language.
Initial Denials: Any initial response from the payer which is not a payment, thus resulting in an appeal or re-work, is an initial denial. This is measured in gross
dollars.
Final Write-offs: if a service is delivered but not paid, despite any appeals
actions taken, then it is considered a final write-off.
Measured in net dollars.
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 10
Level Set on Terminology Across Organization
Current initial denial terminology is confusing and difficult to explain to key stakeholders across the organization, making it hard to interpret data.
Recommendation
ABC Current Terminology
Specific verbiage developed across the
organization for current workflow
Soft Denials Hard Denials
“A denial that needs additional information
to be processed”
“Claim that hasn’t been paid”
“Any claim that hasn’t been fully processed
by the insurance company; something
is missing from a billing standpoint”
“More complex and has to do with the contract language”
We’ve never really discussed the terminology, we just understand how each one is defined.
Management Team
Denial definitions must be clear and understood by all stakeholders across the organization
2/20/2017
6
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 11
Cross Departmental Coordination Inefficient
Coordination between departments is inefficient due to the varying data sources, numerous manual processes, and methods of communication.
Clinical denial is identified in RCA by
denials analyst
Analyst emails Clinical denials team with denial information
Clinic al team sorts into Outlook folder and prints email with attachments
Printouts are added to “Appeals Binder” to be
worked in order of due date
Appeal is manually logged in binder and pulled to
work appeal
Clinical team reviews documents, writes appeal letter, prints and
sends to insurer
Appeal letter is scanned and added to Outlook
folder
Clinical team emails denials analyst, adds
notes to RCA and ROC
Denials analysts emails Clinical team with follow up and questions as needed
Appeal approval or denial is mailed back to appropriate denials
department with no follow up to the Clinical team
Clinical Denials Example
Communication Forms
• Emails between analyst and Clinical team, often with no follow up
• Notes added in RCA and ROC, many times not added to RCA routinely
• Phone calls between departments
3
Manual Processes
• Printing denials emails and documentation
• Adding hard copies to Appeals Binder
• Hardy copy handoffs
• Scanning appeal letters
4
Data Sources
• Emails containing denials information and documentation
• Clinical denials team Appeals Binder
• RCA work queues
3
EMR ‘work items’ functionality can eliminate several manual processes and multiple communication forms.
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 12
Write Off Policies and Methods of Prioritization Differ
Differing write-off policies and prioritization standards across teams leave room for standardization and clarification.
Denials Management Team
Government Billing & Follow up
Non-Government Billing & Follow up
1 2 3
Key Takeaways
1. Multiple write-off policies and processes2. No standard work que prioritization process
• Write-off amounts
– Staff: ≤ $5,000
– Manager: $5,000 - $10,000
– Director: ≥ $10,000
• Prioritization: High dollar amount, referrals, or status date
• Write-off amounts
– Staff: ≤ $2,500
– Manager: $2,500 - $5,000
– Director: ≥ $5,000
• Prioritization: Oldest date of service, high dollar amount
• Write-off amounts
– Staff: ≤ $1,000
– Lead: $1,000 – 5,000
– Manager: $5,000 - $10,000
– Director: ≥ $10,000
• Prioritization: Status date over 30 days
2/20/2017
7
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 13
Need to Shift From Diagnosis to Prevention
Diagnose Solve Prevent
Today
Tomorrow
35% 15%
35%
Percent of Time Spent In Each Area
15%
Create a More Nimble Organization
50%
50%
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 14
Common Traits of a Best-In-Class Denials Program
TRANSPARENT DATA GIVES VISIBILITY TO STAKEHOLDERS
� Apples-to-apples comparison across all technologies and facilities
� Data is distributed in the right amount of detail to each appropriate level
� Education is delivered to appropriate leaders and staff so that they understand denials terminology
CORE INFRASTRUCTURE SETS THE SCENE FOR SUCCESS
� Policies and procedures are consistent across all facilities
� Physician Advisors and Denials Coordinators have clearly defined roles
� Responsibilities and communication strategies are clearly defined
PROACTIVE, PREVENTATIVE PROCESSES ARE HARD-WIRED
� Monthly Denials Committee brings stakeholders to the table to drive action
� Prescriptive preventative steps have been identified in the event that a denial occurs for a specific reason
� Leaders are held accountable for denials stemming from their areas
� Prioritize quick wins, high-dollar trends, and high-frequency issues
UNDERPAYMENTS ARE SCRUTINIZED AND APPEALED
� Key opportunities are identified and evaluated according to priority
� Batch appeals are used if/when there is a large trend or payer error
� Improper use of payments and contracts are sent back for re-processing
TECHNOLOGY DRIVES WORKFLOWS AND ANALYTICS
� Unified Data Source: Unite PAS, claims, other data to provide single source for denials and payment variances
� Flexible Collections Workflow: Workflow to manage accounts with automated work lists and batch processing
� Extensive custom reporting: Reports to monitor best opportunities and identify payment error trends
2/20/2017
8
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 15
Customized Denials Categorization is Possible and Necessary within Tech
Enhanced technologies enable organizations to group denial reason codes into customized categories to drive accountability and denial data understanding across the organization
Impetus for Reason Code Categorization Updates
• Government mandates such as the transition from ICD-9 to ICD-10 has impacted trends for certain reason codes
• Payer guidelines continually change, and ABC denial categorizations must meet updated payer requirements
!
Reason Code
Timely Filing & Follow up
Coding
DocumentationBilling edit needed
Wrong Payer
Medical Necessity
Authorization
Solution-State Technology-Enabled Denial Categorization through ERA Manager
Example of Current Need:
Requested transfer of Code 50 (non-covered services) from ‘Non-Covered’ category to ‘Medical Necessity’ category under current model
Eligibility
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 16
Educating Staff and Creating Facility Level Ownership
It is not expected that leaders across an entire organization understand the nuances of denials. The first step is to align key stakeholders by speaking the same language. From there, it is essential key staff are educated at different levels of detail in order to create awareness, accountability and sustainability.
• Formalize definitions for denials by category and department for all reason codes:o Patient access, mid-cycle, business
office and diagnostic imaging, outpatient surgery, etc.
o Technical versus clinicalo Initial versus Finalo Gross dollars versus Net
• Provide and define benchmarks for initial denials by area
Denials Terminology and Benchmarking 101
• Break down the denials categories to begin delegating responsibility
• Provide in depth denials education to key constituents responsible for upfront revenue cycle and clinical processes resulting in specific downstream denials
Diving Into Denials Details
• Establish preventative actions for every denials cause, and educate upfront revenue cycle and clinical staff on prevention tactics
• Create manager, director, and senior leadership reports/dashboards to monitor initial denials and appeals success performance
• Roll out the Advisory Board’s accountability tool to help bridge the gap between infrastructure and actions to be taken
Hardwiring Culture of Accountability and Denials Prevention
2/20/2017
9
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 17
Useful Strategies for Optimizing Denials Analytics and Creating Accountability
Key Steps for Leveraging Analytics and Fostering Accountability
Develop charts to be housed for all revenue cycle functions in one, central system
Define the metrics necessary for each level of the organization
Identify targets benchmarks to give perspective on performance
Develop action plans for upward communication to leadership
Risk Thresholds and Performance Targets to be Built in ERA Manager
Sample Graph Built in ERA Manager1
2
3
4
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 18
Executive-Level Metrics Filter Through Enterprise
Successful denials management will be tracked through two primary metrics, which must filter down through each department.
ABC Initial Denials as a % of ABC Gross Revenue ABC Final Denials as a % of ABC Net Revenue
ABC Pre-access denials as % of ABC Gross Revenue
ABC Back-end denials as a % of ABC Gross Revenue
Chief Financial Officer
ABC Mid-cycle denials as a % of ABC Gross Revenue
Patient Access Leaders Mid-Cycle Leaders PFS Leaders
Access Management Team
Denial Code Set A
Denial Code Set B
Denial Code Set C
Supervisors
Denials aligning to job responsibilities as a % of ABC Gross Revenue
Mid-Cycle Management Team
Denial Code Set D
Denial Code Set E
Denial Code Set F
Supervisors
Denials aligning to job responsibilities as a % of ABC Gross Revenue
PFS Management Team
Denial Code Set G
Denial Code Set H
Denial Code Set I
Supervisors
Denials aligning to job responsibilities as a % of ABC Gross Revenue
2/20/2017
10
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 19
Proper Action Plans Essential to Performance
It is imperative that there are prescriptive action plans for each type of denial experienced across the organization. High performing organizations have developed action plans for each denial.
Denial Cause Preventative Strategy
Denial causes properly align with the denials category based on ABC-specific processes.
Prescribed strategy to prevent specific denials will allow staff to effectively manage next steps toward denial resolution.
Patient Access
Category 1
Category 2
Category 3
Mid-Cycle
Category 4
Category 5
Category 6
BusinessOffice
Category 7
Category 8
Category 9
Denial Category Alignment by Function Custom Prevention Strategy
Every department in the organization will have comprehensive list of denials for which they are responsible as well as a preventative strategy for resolution.
Sample Preventative Action Lists
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 20
Collaboration is Key to Denials Mitigation
Denials management is not a business office problem; it’s a revenue cycle priority that takes collaboration across all revenue cycle functions to be successful.
Access
• Works with clinics to financially clear a patient
• Works with Mid-Cycle to validate clinical documentation
• Supplies business office with documentation to support appeals efforts
Mid-Cycle
• Works with Clinics to ensure appropriate documentation to support codes for authorization
• Works with Pre-Access to supply clinical support for authorization
• Works with business office to ensure accurate coding on claim prior to claim submission
Business Office
• Works with Mid-Cycle to ensure accurate coding on claim prior to claim submission
• Works with Pre-Access to update patient data and demographics as needed
• Coordinates with coding and clinical appeals team to appeal denials in a timely fashion
Denials Prevention
2Different Types of Denials to work, appeal and/or write-off
3Different Facilities with which to coordinate
4Separate teams with which to effectively communicate
ENABLE
ABC Physician Clinics
• Works with Pre-Access department to appropriately verify insurance and secure authorizations
• Works with Business Office to supply additional documentation to support procedure codes
1Mission under which all staff at ABC Health System operate
2/20/2017
11
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 21
Case Studies: Kalispell and Cancer Treatment Centers of America
Impact Highlights
Recoveries on underpayments/denials Q1-Q3 2015
$5.42M
Increase in recoveries over 2015 v. 2013 after creation of underpayment/denials recovery position
$1.51M
3 daysReduction in A/R days 2015 v. 2013
Kalispell Regional Medical Center
273 beds, Kalispell, MT
$0
$200,000
$400,000
$600,000
$800,000
$1,000,000
$1,200,000
$1,400,000
Jan Feb Mar Apr May Jun Jul Aug Sep
2013 2015*
Dollars Recovered on Payer Payments After Appeal
1 LEVERAGINGHUMAN CAPITAL
2CUSTOMIZINGTHE TECHNOLOGY
2HARDWIRINGPROCESS SUCCESS
Cancer Treatment Centers of America
Five Facilities located across US Impact Highlights
Dollars recovered from August 2015 through mid-April 2016
$77.62M
Number of months during which $77.62M was recovered, averaging $9.13M per month across five facilities
8.5
5,759Number of accounts with recoveries during that time period
Denial Dollars Recovered, Aug 1, 2015 to April 19, 2016
Sorting Accounts
Prioritizing Accounts
Allocating Resources
Assigning Activities
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM 22
Staff Ownership, Permanent Results
Our Philosophy
Optimal revenue cycle
performance requires innovative
solutions tied directly to business
outcomes. We pair state-of-the-
art technologies with consulting
services and collaborative peer
networks to drive transformative
change at member organizations.
By relying on hospital staff as
team leaders who select and
execute best practices, Advisory
Board consultants leave behind
hospital staff better prepared to
tackle additional operational
problems on their own and to
sustain hard-won successes.
”
Grounded in FLC Research• We install best management practices
proven in daily practice• Hundreds of best practices are
surfaced every year in our Financial Leadership Council research program
Deep Bench of Experience• Roster of talented professionals with
deep expertise across revenue cycle, IT, and physician initiatives
• Collectively, our team has 750+ years of hospital operator experience
Pillars of Our Work
Cohort-Driven Improvement• Our experts leverage experience
working with over 500 hospitals• Cohort members share ideas and best
practices, and include a wide range of organizations; AMCs, regional medical centers, small hospitals, for-profits
Accelerated Results • Best-in-Class business intelligence
solutions diagnose problems quickly• All activities push toward a quantifiable
result: financial performance, efficiency and productivity gains, patient financial experience
• Ongoing support ensures sustained results and continual progress
2/20/2017
12
©2016 THE ADVISORY BOARD COMPANY • ADVISORY.COM©2011 THE ADVISORY BOARD COMPANY • ADVISORY.COM
2445 M Street NW I Washington DC 20037
P 202.266.5600 I F 202.266.5700advisory.com
Benjamin Beadle-RybyPartner, Consulting and Management
BeadleB@advisory.com
Your Presentation Team
Please do not hesitate to reach out to us with any questions
Joy Houk-RaperVice President
HoukrapJ@advisory.com
top related