Becker's Hospital Review

27 EXECUTIVE BRIEFING 3 EXECUTIVE BRIEFING The key is to build programs that connect the dots and show where money is going and whether it's being lost. In an environment of high employee turnover, creating processes that are "people independent" is critically important. To protect the organization, revenue cycle teams must develop processes that are simple enough that anyone can complete them. Payer performance management is another effective way to optimize reimbursement. One important aspect of this strategy is analyzing the chargemaster. "You need to look at pricing and charges which are tied to your chargemaster," Mr. Moorthy said. "Organizations, should not only look at utilization for certain services to determine prices, but also compare their prices for those services to other providers in their market. Price transparency is a hot topic in healthcare right now and you want your prices to be in line with competitors, if not better." A second key element in payer performance management is examining the clauses embedded in the terms and conditions of payer arrangements. These may state explicitly when bills will be paid. "This is something that providers must scrutinize by leveraging revenue cycle reports by payer before going into managed care negotiations," Mr. Moorthy said. The information in payer manuals also needs to be understood by the RCM team. These documents usually stipulate important rules and regulations related to claims processing, which can impact collections. Taking a closer look at revenue cycle reporting is very integral. Consider whether reports provide actionable information that will help improve business processes. Knowledge about denials is only as good as the team's ability to do something with it. Ideally, reports will shed light on not only payer performance, but the cause of denials, such as staff turnover, employee training or process problems. "If you look at the trends in denials management reports, they haven't changed for the last five to ten years," Dr. Kandiyil said. "You have to ask the question, 'What are we doing wrong and why aren't we moving the needle?' Is it a payer problem, a people problem, a process problem or a combination?" Strategic sourcing is worth evaluation by organizations of all sizes. Although outsourcing and offshoring have typically been adopted by the largest health systems, tier 2 or tier 3 hospitals should also take a look. Data can reveal gaps in people, processes and technology Just as it's important to take a holistic approach to the revenue cycle overall, it's also critical to look holistically at revenue cycle metrics. Most teams use analytics in a siloed way and they don't tie together. "At an organization I worked with in the past, two divisions didn't talk to each other and they were doing the exact same thing," Dr. Kandiyil said. "The role of analytics is to better the departments. Information must be shared across departments so everyone has visibility into the upstream and downstream impact of what teams do on a daily basis." While descriptive analytics are good, prescriptive analytics are even better and these are what providers must strive for. By using prescriptive analytics, hospitals and health systems can forecast what's coming down the pipeline and leverage these insights for future planning. With payer performance management, for example, teams can use analytics to determine how much reimbursement they are receiving currently on a regular basis from different payers and then create a plan of action based on any financial forecasts. "If you have a high percentage of yield for a certain payer, you're doing well in that current reimbursement arrangement and if it's low, there's a problem," Mr. Moorthy said. "That's a sign that you need to have a conversation with that payer in upcoming negotiations." He added another interesting metric to consider, percentage of accounts receivable for reimbursement from payers, which many providers look at from an operations perspective — but can also shed light on payer relationships. Reliable, trusted partners enable healthcare organizations to achieve their RCM goals Many elements of the revenue cycle have become commoditized, so when it comes to partnering, organizations often find themselves in a race to the bottom to find the cheapest alternative. This is bad for the revenue cycle and for employees. Dr. Kandiyil reflected on how organizations frequently make short-term, one-off changes to revenue cycle processes rather than implement what is actually needed: sustained improvements on a continuous basis. The greatest opportunities to maximize the revenue cycle lie with a reliable and trusted partner. "When we work with hospitals and health systems to identify RCM solutions, we work to become their partner," Dr. Kandiyil said. "Our objective is to examine the revenue cycle through a single lens. We determine whether you are getting your money's worth for your investments in people, processes and technology, and recommend how you can improve."

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