Summary of Work:
The hospital CFO contacted Warbird’s revenue cycle professionals to discuss the hospital’s poor financial performance, lack of revenue cycle functionality, and limited cash on hand. The hospital was interested in understanding options to improve financial viability, revenue cycle outcomes, and system accountability.
CFO Primary Concern:
That the revenue cycle was not contributing to system success; instead, the policies, procedures, and practices employed were obstacles to their financial viability.
Background:
Warbird’s revenue cycle professionals conducted an in-depth revenue cycle assessment to identify best practices and opportunities for improvement. The assessment was customized to meet the size, scope, and needs of Pemiscot Memorial. The process included a thorough review of data components, system capabilities, and interviews with relevant revenue cycle staff. The assessment results were shared with the CFO and appropriate revenue cycle staff. Specific time was spent on root cause identification, analysis of revenue cycle culture, and implementation strategies. Warbird professionals and the CFO collectively designed a full revenue cycle review and implementation project, which contributed immediate value, allowed for sustainable results, and aligned with administrative priorities.
Areas of Focus:
Warbird professionals developed a comprehensive plan to address the systematic inefficiencies and implement best practices through training, education, and foundational improvement. Specific areas of focus included:
- Revenue Cycle Leadership Development: Warbird professionals established a formal, team-based revenue cycle process based on data, representative participation, and administrative expectation. Regular meetings were held with department leadership and aligned revenue cycle staff. Sessions focused on modality-specific utilization, improved revenue cycle reports, education, and root cause issue resolution. Meetings transferred accountability and ownership to departmental leadership, with the full support of the CFO. As a direct result of increased attention, gross revenue increased, net reimbursement improved, accounts receivable days dropped, late charges diminished, and patient satisfaction improved.
- Chargemaster Review: A review of every charge code was undertaken. The analysis included best practice comparisons for description, revenue code, price, missing codes, companion codes, and deleted codes. Focused attention was placed on items that might contribute to denials, generate revenue capture concerns, and impact customer satisfaction. Specific policies and procedures were developed and implemented to govern the generation of new codes and ongoing maintenance of existing ones. Department leadership was engaged in the improvement processes and took accountability and ownership of their respective chargemaster components. Warbird professionals, administration, and department leadership reviewed findings and modified chargemaster components to reflect best practices. Departments now own their sections of the chargemaster.
- Strategic Pricing: In conjunction with administration, a patient-centric, defensible pricing strategy was developed and implemented. Attention was placed on departmental payor mix and patient status distribution, by modality, to maximize contractual opportunities while addressing patient concerns and expectations. Pricing variability was eliminated, operational budgets became more reliable, and reimbursement became more representative. The updated pricing methodology is now equipped to maximize contractual opportunities, exceed customer expectations, and meet transparency requirements.
- Revenue Cycle Process Modification: Warbird professionals assisted with a complete redesign of foundational revenue cycle processes. A policy to govern chargemaster maintenance was implemented to ensure process redundancy, quality checks, and timeliness. Processes governing revenue capture for the emergency room, facility observation, ambulatory infusion, facility operating room, professional surgical services, hospitalist services, and professional anesthesia were redesigned and optimized for consistent, complaint, and total revenue capture. As a direct result of these efforts, the hospital experienced record revenue recognition.
- Provider Education and Documentation Review: Warbird professionals engaged providers, nurses, and technicians to improve the content and quality of documentation. Providers were trained and educated to ensure full, complete, and complaint recognition of service provision. Likewise, specific training was provided on the compliant documentation of drug administration codes and observation services. These activities have improved the timely submission of revenue, lowered denial activity, lessened incomplete records, increased clean claim submission rates, and improved cash flow.
Conclusion:
The Pemiscot Memorial Health System revenue cycle has transformed from a non-participative, variable process to a controlled process based on data, quality, and customer expectation. The hospital has experienced reliable chargemaster composition, consistent pricing, improved clinical documentation, and active departmental participation. Over the past several months, the hospital has set records in gross revenue recognition and reimbursement across multiple departments. Administration actively controls the revenue cycle through the provision of improved revenue cycle reports combined with the clear communication of goals, expectations, and commitment to customer service. Financial viability and available cash are improving, and the hospital now has the potential to control its future and ensure the ability to fulfill their vital community mission.