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Bridging the Gap to Achieving Patient Financial Clearance
Jamie Modesto Territory Account Executive The SSI Group, LLC.
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SSI: At A Glance Founded in 1988 Based in Mobile, AL
400 employees and growing Serving leading healthcare providers Providing a complete revenue cycle solution
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SSI: By the Numbers Health Providers rely on SSI to manage their revenue cycle 2400 Institutional and Professional claims processed 1T 750 Direct payer connections 15 Average tenure for our Top 20 Clients
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Foster a dialogue. You are the experts. PARTICIPATE !!!
Agenda Common Business Issues Flipping the Pyramid Revenue Leakage: Root Cause Technology Accelerators Bridging the Gap Foster a dialogue. You are the experts. PARTICIPATE !!!
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Common Business Issues
Registration errors – leading to rework Denied procedures – lack of Medical Necessity Unidentified patient responsibility – after insurance Incorrect patient information – address, identity Inaccurate benefit information – cause claim rejection / denial Incomplete patient collections – staff collecting total OOP Unknown qualification of financial aid – Medicaid or charity 40% to 60% Revenue Leakage – Patient Access Processes “As goes Patient Access, so goes the whole Revenue Cycle.”
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The Need to Flip the Pyramid
Patient Access has to focus more than ever on… …Patient Financial Clearance!
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Average $124 million per System
Creating Focus Total Charges Non-Covered or Denied Charges $70 billion Contractual Adjustment $354 billion $197 billion $91 billion Average $124 million per System $21 billion Patient Responsibility Insurance Payment $66 billion Source: SSI Clearing House Data, 2015, 729 Systems
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Cash Flow Timing - Typical Scenario
Registration Validation & Benefits Mgt. Billing & Claim Status Denials & Payment Variance Mgt. Audit Mgt. Care POS Patient Collections Patient Collections Around 4% Margin +$40 Small margin 1-2 Months 1-3 Months Breakeven Line Collect the final patient balance -$1,000 Start off deep in the red Get paid correctly by the insurance company (no denial) Collect some of the patient responsibility up front
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Revenue Leakage – Upfront Process Errors
Registration Validation & Benefits Mgt. Billing & Claim Status Denials & Payment Variance Mgt. Audit Mgt. Care POS Patient Collections Patient Collections $70 billion Incorrect Benefits Captured Up Front -$900 Large loss -$1,000 Start off deep in the red Collect some of the patient responsibility
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Denials and the Financial Pressure
Financial challenges are #1 concern for CEOs Claim denials are a significant contributor 1 in 5 claims are delayed or denied The Pressure is Being Felt – In our Example to the tune of $70 billion Represents a significant pressure on the financial system of a hospital
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The Revenue Cycle Leaky Pipes
$70+ Billion in Denials Source: The SSI Group, 2015, 729 Systems
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Start to Break it Down – Areas of Focus
Patient Access Denials $29+ Billion in Denials $70bn 100% 45.1% 41% 28.0% Patient Eligibility or Coverage 19.7% Payer / COB 7.3% Coding / Med Necessity Source: The SSI Group, 2015, 729 Systems Authorization
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Root Cause of Denials? What: Lost Revenue and/or Increased Costs
How: Overworked, Missing Visibility, Unclear Policies and Procedures Where: Patient Access Process Why: Lack of Automated, Integrated Workflow Tools There is no single root cause for denials, nor is there one single trouble area. Rather, problems that lead to a denied claim occur throughout the revenue cycle… …However, following the numbers do provide a path…
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Insurance Verification
Patient Eligibility Related Denials 72% Related to… Benefit maximum reached Patient cannot be identified Expenses incurred after coverage terminated Devil is in the Details and Worth $ Billion Source: The SSI Group, 2015, 729 Systems
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Who is on First, Second, Third…
Coordination of Benefits 92% Related to… Not covered by this payer/contractor Care may be covered by another payer Avoidable Denials? $8.2 + Billion Source: The SSI Group, 2015, 729 Systems
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Where is the Leaky Pipe? Coding / Medical Necessity
27% Related to… Not deemed a 'medical necessity‘ Coverage guidelines Referral absent or exceeded Knowing Which Animals are not Covered Could be Worth up to $5.8 + Billion Source: The SSI Group, 2015, 729 Systems
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PreCert / Authorization
Are You Authorized? PreCert / Authorization 70% Related to… Precertification/authorization/notification absent Services denied at the time authorization/pre-certification was requested $2.1 + Billion Source: The SSI Group, 2015, 729 Systems
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Root Cause to achieve Patient Financial Clearance
How to Keep you Money Average $40 million per System Areas of Focus Root Cause $ At Risk…or Potential Revenue Insurance Coverage 72% - 3 categories $13.1+ billion $29.3+ Billion Can be Retained COB 92% - 2 categories $8.0+ billion Medical Necessity 27% - 3 categories $3.9+ billion Authorization 73% - 2 categories $2.1+ billion
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Shifting Gears to POS Missed Collections
Insurance Payment Patient Responsibility Contractual Adjustment Non-Covered or Denied Charges $70 billion $197 billion $21 billion $66 billion Total Charges Registration Validation & Benefits Mgt. POS Patient Collections Care Denials & Payment Variance Mgt. Billing & Claim Status Audit Mgt. Patient Collections $21 billion -$200 Moderate loss -$1,000 Start off deep in the red Missed collection opportunity
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Lost Revenue 300 HFMA Respondents Not Collecting At POS
Recovery of less than 30% of payments Healthcare Financial Management Association’s (HFMA) Annual National Institute (ANI) conference.
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Uninsured Rates Coming Down…
Percentage Uninsured in the United States by Quarter Among adults aged 18 and older. Reaching Utopia? SOURCE: Gallup-Healthways Well-Being Index
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…And Premiums are Stabilizing
Total Average Premiums For Family of Four Increased by a total of 4.1% Worker Contribution up by only 2.7% …but what is the TOTAL out of pocket for the patient? 2.7% 4.1% SOURCE: Kaiser/HRET Survey of Employer Health Benefits, 2015
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But Household Income Hasn’t Kept Up
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Patient’s Annual Liability Continues Rising
Between 2010 and 2015 The total employee cost increased by approximately 43% Employer costs increased by 32% The Breakdown Family of 4 pays over $10,400 per year
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Now, Even Insured Needing Assistance
Number of Insured: 318,868 Per U.S. Census Bureau Federal Poverty Level Below 100: 46,657 or 14.8% : 58,686 or 18.9% Federal Poverty Level 200 – 300: 51,451 or 16.3% At or greater than 300: 159,009 or 50.4% Over 33% below 200% FPL! Discrepancies due to Rounding
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Becoming the Patient Advocate
Goals: Prepare patient for the financial responsibility Empower patient with information necessary to be engaged as a consumer of healthcare Identify mutually agreeable payment terms Prevent the patient’s account from ending up in a bad debt status
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Importance to Stakeholders
Why is it important to the HOSPITAL? If the hospital does not receive payment prior to the time of service, there is a 55% chance account will go to Bad Debt. Why is it important to the PATIENT? If the hospital does not receive payment prior to the time of service, there is a 55% chance that the account will go to Bad Debt.
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Bad Debt from the Patient’s Perspective
Phone calls Legal proceedings Letters Liens on properties Credit consequences Liens of estates Difficulty securing loans (i.e. school, home etc…) Bankruptcy Bankruptcies resulting from unpaid medical bills will affect nearly 2 million people this year making health care the No. 1 cause outpacing bankruptcies due to credit card bills or unpaid mortgages* *CNBC Medical Bills Are the Biggest Cause of US Bankruptcies: Study, Dan Mangan June 2013
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The Importance of Financial Education…
Research has shown 68% prefer to know financial obligations at, or before, discharge Over one-third want to know financial obligations prior to admission or registration Source: IMA Consulting
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…if Information is Presented to Patients
Research has shown 52% of patients would pay from $200 to $500 or more… …if an estimate was provided at the time of care. Source: JPM Key trends in healthcare patient payments
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The Patient Advocate Opportunity
Implementing a process for Patient Access to become the Patient Advocate: Explains insurance benefits to patient Communicates amount patient can reasonably be expected to be responsible for Identifies needs and connects patients to various resources for assistance (i.e. Charity care, Medicaid, co-pay assistance programs) Allows patient to make decisions and prepare for costs related to medical care
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There’s a lot more below the surface
Does your Patient Access staff: Check eligibility 100% of the time? Confirms Med. Necessity for all Medicare Patients? Understand for every admission if an Authorization is needed? Prepare estimates for all patients? Attempt to collect from everyone at admission? Do you think you have flipped the pyramid at your hospital? Or are you just at the tip of the iceberg?
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Creating a Retail Revenue Cycle
The bill is under the door
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Debunking Patients’ Expectations
Healthcare is different from other industries? Consumers don’t bring same expectations about customer experience to healthcare that they bring to retail or technology companies? Participants were offered 10 qualities and asked to select the 3 they thought mattered most. Source: McKinsey 2015 Consumer Health Insights survey Wrong
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Patient Access Solutions Progress?
Patient Access Functions / Applications Home Grown, Vendor or Outsourced Solution Manual, or No Processes 2015 2013 Address / ID Validation 51% 56% 29% Registration Quality 44% 31% Eligibility 77% 74% 11% Pre-Authorization 38% 34% 42% Medical Necessity 59% 58% 22% Bill Estimation 35% 36% Propensity to Pay Scoring 28% 32% Cashiering 41% Charity Screening 25% 45% “Flipping the Pyramid” will require automated, integrated rule-based workflow solutions Source: HIMSS Analysis 2015 Revenue Cycle Series: Patient Access
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Too much when not Integrated / Automated
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Change Initiatives Development of a “Pre-Access Service Center”
Schedule & Pre-Register Patients Include pre-registration in the scheduling step Real-time insurance verification Cost of care estimate Financial Counseling Tools needed Comprehensive scheduling system Real-time eligibility Cost of care estimate capability Medical necessity check Yes/No Authorization Database Payment processing Patient Financial Analysis Call and screen recording Call Q monitoring system
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What Happens When You Get it Right?
financial management performance management
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Unity Health White County Medical Center
Bridging the Gap – QA Up Unity Health White County Medical Center 98% Before Revenue360 Registration Accuracy Rates After Revenue360 39% Copyright © 2011 NTT DATA Corporation
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Bridging the Gap – AR Days Down
White County Medical Center QA & AR Days Impact: Unity Health White County was able to decrease its AR days by 13.4 Potential Savings of over $600k 59.1 Days 45.7 Days October 2012 June 2016
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Bridging the Gap – Collections Up
White County Medical Center 2015 had an increase of 168% 2016 is showing an additional increase for the first 7 months alone 168% increase
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Thank You Questions? Email: preston.messer@ssigroup.com
Phone: (800)
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