Improve Timeliness of Payment: Reduce Charge Lag Loyola University Physician Foundation

Opportunity or Problem Statement: In order for physicians to be paid accurately and timely, LUPF must submit “clean” claims to the payers in a timely manner. The AVERAGE CHARGE LAG is the average number of days between the date of service and the date the charge is entered in LUPF’s billing and collection system. The average Charge Lag for all LUPF charges was 17.4 days (as of July, 2001). GOAL: To improve the timeliness and accuracy of payment, it was LUPF’s goal to reduce the average charge lag by 25% the first year.

Most Likely Causes Identified: Paper charge tickets, completed at the point of service, were manually transported to LUPF’s central business office (CBO). Each charge ticket was first manually reviewed for accuracy and completeness and if complete, it would be entered in the billing system. Charge tickets that were incomplete were returned to the physician, consequently causing the process to be repeated.

Solutions: In January 2002, LUPF began deploying staff to the ambulatory clinics to enter charges at the point of service; to date LUPF enters charges at 26 locations. LUPF introduced a new billing and collection system (IDX) in October 2002 which would serve to automatically edit the charge for inaccurate or missing information before billing.

Results: The average Charge Lag for all LUPF charges is 12.9 days (as of February, 2004). The average Charge Lag for those sites with LUPF staff has decreased significantly (as illustrated in charts). The release of charges from the editing system is completed by several areas with an array of correction methods resulting in an increase in variability.

Next Steps: Assess LUPF’s ability to reduce outside variables affecting Charge Lag. Continue to monitor Charge Lag. Monitor days in Accounts Receivables and denial rate.

LUPF Charge Lag (In Days) for All Locations Confidential material for quality improvement purposes I Temporary: UCL=19.44, Mean=15.07, LCL=10.70 (mR=2) Jul-01 Aug-01 Sep-01 Oct-01 Nov-01 Dec-01 Jan-02 Feb-02 Mar-02 Apr-02 May-02 Jun-02 Jul-02 Aug-02 Sep-02 Oct-02 Nov-02 Dec-02 Jan-03 Feb-03Mar-03 Apr-03 May-02 Jun-03 2Jul-03 Aug-03Sep-03 Oct-03 Nov-03 Dec-03 Jan Mean UCL Mean LCL Mean = 15.1 Days

LUPF Charge Lag for Primary Care Center Wheaton Confidential material for quality improvement purposes Jul-01 Aug-01 Sep-01 Oct-01 Nov-01 Dec-01 Jan-02 Feb-02 Mar- 02 Apr-02 May-02 Jun-02 Jul-02 Aug-02 Sep-02 Oct-02 Nov-02 Dec-02 Jan-03 Feb-03Mar-03 Apr-03 May-03 Jun-03 Jul-03 Aug-03 Sep-03 Oct-03 Nov-03 Dec-03 Jan UCL LCL UCL Mean = 6.1 Days Mean=13.0 Days

LUPF Charge Lag (In Days ) for Primary Care Center in Oak Brook Terrace Confidential material for quality improvement purposes Jul-01 Aug-01 Sep-01 Oct-01 Nov-01 Dec-01 Jan-02 Feb-02 Mar-02 Apr-02 May-02 Jun-02 Jul-02 Aug-02 Sep-02 Oct-02 Nov-02 Dec-02 Jan-03 Feb-03 Mar-03 Apr-03 May-03 Jun-03 Jul-03 Aug03 Sep-03 Oct-03 Nov-03 Dec-03 Jan UCL LCL UCL LCL Mean = 7.4 Days Mean = 13.2 Days