Becker's Hospital Review

21 CFO / FINANCE Memorial Regional Health outsources billing and coding, 24 jobs cut: 5 things to know By Kelly Gooch C raig, Colo.-based Memorial Regional Health will no longer manage billing and coding in-house, according to the Craig Daily Press. Here are seven things to know. 1. MRH officials informed staff April 25 of the decision to eliminate the hos- pital's billing and coding department and, instead, outsource the services to Longview, Texas-based Zion Revenue Solutions, according to the report. The move affects 24 employees. 2. The health system signed a three-year contract with Zion. Under the contract, Zion will receive payment based on a portion of net revenue. It also includes a 90-day "out clause," which means MRH could terminate the contract with 90 days notice, if necessary. MRH will pay roughly the same amount it has been to conduct billing and coding in-house. 3. Displaced employees on the job less than a year received two weeks' pay in lieu of a notice, while employees on the job a year or more were provided severance packages, according to the report. Affected employees are able to pursue job opportunities at Zion and at MRH. MRH CEO Andy Daniels said he anticipates Zion will hire approximately four employees locally. 4. The outsourcing move comes amid billing and coding issues at MRH. "We've had billing issues in the organization for lots and lots of years, de- cades really," Mr. Daniels said, according to the Craig Daily Press. "The com- munity knows it. Our employees know it. It may get worse before it gets better." 5. Mr. Daniels said the health system was already outsourcing a large por- tion of billing, with "two different extended business offices and two differ- ent collection agencies." He added: "Those contracts have been eliminated, and the remaining agency is through the Western Healthcare Alliance, lo- cated in Grand Junction, Colo." n Georgia hospital closure will result in 200 layoffs By Ayla Ellison C hestatee Regional Hospital in Dahlonega, Ga., will lay off 200 em- ployees when it closes later in 2018, according to The Dahlonega Nugget. On March 30, Gainesville-based Northeast Georgia Health System an- nounced it reached a conditional agreement with DL Investment Holdings to buy Chestatee Regional Hospital. Under the agreement, the current own- er would close Chestatee Regional and sell the property to NGHS. NGHS then intends to sell the property to the Georgia Board of Regents. If the sale goes through, 200 people would lose their jobs when the facility clos- es, which is expected by the end of July, according to The Dahlonega Nugget. Chestatee Regional said employees who lose their jobs will not receive sev- erance packages, but they will be able to apply for jobs with NGHS if the facility reopens, according to the report. n How some rural hospitals score huge paydays from insurance companies By Ayla Ellison M any rural hospitals across the nation are facing financial challenges, caus- ing some facilities to seek bankruptcy protection or close their doors for good. How- ever, other rural hospitals are more profitable than ever due to enterprising executives who are allegedly using the facilities to reap big paydays from insurance companies, according to a CBS News investigation. e owners of Chestatee Regional Hospital, a 49- bed hospital in Dahlonega, Ga., had been trying to sell the facility for years when Aaron Durall, a man from Florida, offered to buy the hospital for $15 million in 2016. Aer the sale, Mr. Durall, who also owned a laboratory testing company in Sunrise, Fla., moved part of the hospital's billing operation to Florida. Soon thereaer, the hospital began receiving big checks from health insurance companies — some up to $500,000. e money was for toxicology tests on urine sam- ples collected from across the country. Some of the testing was done at Mr. Durall's lab in Florida, but everything was billed through Chestatee Re- gional Hospital, according to CBS. Insurance companies reimburse some rural hos- pitals at higher rates to help keep healthcare in rural communities. Mr. Durall reportedly capital- ized on this by buying Chestatee and a few other rural hospitals. His lab made about $67 million by billing tests through a hospital in Graceville, Fla., and approximately $31 million in the last eight months by billing through a hospital in Northern California, according to CBS. In an email to CBS, Mr. Durall said, "All testing at the rural hospitals you mention is properly billed." Other businesses have entered into similar ar- rangements as Mr. Durall's lab company. In Au- gust 2017, the Missouri State Auditor released a report that revealed a rural hospital in the state generated $92 million in revenue in the six months aer entering a new laboratory billing agreement with Hospital Partners, a Florida-based manage- ment company. is represented an increase of approximately 2,353 percent when compared to the previous six-month period. n

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