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UCB and Self Pay CompanyPartnering to Improve Self Pay CollectionsFebruary 2009Proprietary and ConfidentialThis information is not to be copied or otherwise utilized without the written consent of UCB, Inc.
Above and Beyond the Call
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Question?
Do you have an automated charity care qualification process in place?
Is your charity care policy administered consistently or subjectively by your staff?
Do you validate every charity case with
Are you attempting to collect form patients who could qualify for your charity policy?
Above and Beyond the Call
Are you maximizing your charity care and collecting what you should from your self pay patient population?
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Introduction iSolutions
Provides financial assessment and account decisioning platform
Streamlines and automates charity care identification and processing
Accurately predicts patient maximum payment threshold
Benchmarks third party collection vendor performance
Validates registration demographics
Improves ROI on internal collection activity by focusing financial and human capital on accounts which have the greatest return
Automates current manual processes allowing workforce to “do more with less”
Above and Beyond the Call
Hosted by Self Pay Company in partnership with UCB
Breakthrough technology reinvents Charity Care and Self Pay account processes
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Market Drivers – Self PayAbove and Beyond the Call
National unemployment: September 2008 6.2% - January 2009 7.6% Highest in a decade (Source: Department of Labor)
State of Indiana: December 2007 4.5% - December 2008 7.8 (Source Bureau of Labor Statistics)
Increasing uninsured & underinsured population
Fewer employer-paid insurance plans
Higher deductibles and co-pays
Consumer directed healthcare plans increasing
Continued regulatory mandates and increased scrutiny
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Market TrendsBreakthrough Strategies
Source: Department of Labor
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Market Trends
154,616 Million in Civilian Labor Force
10,331 Million Unemployed
If Unemployment Increases to 10.6%
Source: Department of Labor
Above and Beyond the Call
Increase of 7.5 Million New Self Pay Patients
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Market TrendsAbove and Beyond the Call
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iSolutions PlatformAbove and Beyond the Call
Address Validation
iSolutions Module
Validates correct address
against most current data available
Description of Module
Automate Charity
Propensity of Payment
Maximum Payment
Fraud Alert Detection
Charity identification - income and number ofdependents/validates against financial profile
Segments accounts into high, medium, low and bad debt payment probability groups
Identifies maximum amount a patient
can pay without hardship and financial duress
Provides systematic process
for protecting data – supports Red Flag Rule
QA – Missing DataIdentifies and validates all
missing data associated with patient account
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Address validation Provides most current address, phone number, employer Updated data returned to hospital eliminating repetitive mail
returns Experian database updated in real time 24/7/365
Presumptive charity care Consistent system takes the subjectivity out of the process Ensures charity care is provided to worthy patients Customized to meet hospital’s charity guidelines Reduces FTE administrative costs by over 50%
Propensity of payment Segmentation of accounts by predictability of payment Payment predictor based on patient’s financial profile Empirical collectability benchmarks for each segment based on
workflow modifications
iSolutions PlatformAbove and Beyond the Call
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Maximum payment recommendation Analyzes patient’s financial profile providing recommended
threshold for payment Accurate estimate of what the patient “really” can afford Eliminates guesswork of high/low balance collection strategy
Fraud alert protection Immediately identifies fraudulent use of PHI Provides systematic process supporting compliance of “Red
Flag Rule”
QA – Missing data Identifies accounts with missing critical demographic data Provides trending data for registration processes Highlights accounts which need additional demographic detail
Above and Beyond the Call
iSolutions Platform
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IRS may issue updated Form 990 to address a lack of standards in current policy
The IRS concerned over "lack of consistency or uniformity in classifying and reporting uncompensated care."
Senators Grassley, Bingaman push for new charity-care standards (proposed amendment to Economic Stimulus Bill - February 2009)
A second amendment would force the IRS to scrutinize “for profit” hospitals
Charity Legislation UpdateAbove and Beyond the Call
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Charity Care PredictionAbove and Beyond the Call
iSolutions Platform utilizes the number of dependents and annual income to determine Charity Validation per the FPG
Income verification factors include:
monthly obligations, mortgage amount, average rent, available credit, credit card balances, auto loans, revolving credit
Stated patient Income is validated to ensure accuracy
Proprietary income estimator validates census & credit data
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Tested algorithm ensures accurate charity prediction
All income estimations verified through Experian credit
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iSolutions Database
Mortgage
Credit Cards
Auto Loans
Revolving Credit
Def
init i
on
Monthly Obligation
Number of Dependents
Greater than $1,361
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Greater than $1,825
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Charity Validation
Additional Attributes
Home Equity Value great than $5,000
Credit Available greater than
$2,500
Charity Care Qualification Methodology
The iSolutions Calculation engine uses the number of dependents and annual income to determine Charity Validation
*follows strict federal poverty guidelines for qualifications
Proprietary and ConfidentialThis information is not to be copied or otherwise utilized without the written consent of UCB, Inc.
**Example based on the federal poverty guidelines
Data gathered from Experian
(credit)
=
Estimated Household Income
Less than $20,420
Less than $27,380
Charity DeterminationAbove and Beyond the Call
Consistent Charity Qualification
Ensure Accurate Financial Analysis
Reduce Charity Fraud
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Charity Care ValidationAbove and Beyond the Call
Consistent & Accurate Validation
Provides a single data sheet which validates charity per your hospital’s guideline
Utilizes stated or estimated income based on demographics
Estimated income is based on Block Census data plus validation factoring against the patients credit file
*Reduce the risk of collecting from qualified indigent patients
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Charity Care Risk MitigationAbove and Beyond the Call
Presumptive Charity Policy
Mitigates risk from administering inconsistent charity policy
Reduces risk of inconsistent and subjective collection practices
Address potential legal issues
Class action lawsuit filed in December 2008 (Andresillo vs. Audit & Adjustment Company). Litigation initiated because charity qualified patients were pursued for collections
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Charity Care Risk MitigationAbove and Beyond the Call
Law Firm Sues Collection Agency for Allegedly Violating Charity Care Law
January 2, 2009 Inside ARM
A medical collection agency in Washington is being sued by a local law firm over practices that the suit say run afoul of the state's charity care provisions. by Cynthia Wilson A Washington healthcare collection agency is being sued by a law firm seeking class action status for allegedly violating the state’s charity care law.
In a lawsuit filed on December 8, Seattle-based Phillips Law Group claims that Audit & Adjustment Company, Inc., based in the Seattle suburb of Lynnwood, has systematically engaged in “the unfair, deceptive and misleading practice of telling patients that they owe the full charges shown on hospital billing statements, without informing them that they may be entitled to charity care that reduces the hospital debt or eliminates it entirely depending on a patient’s income level.”
Lead attorneys John Phillips and Matthew Geyman are seeking class action status for the lawsuit filed in King County Superior Court. In addition to statutory damages on behalf of the plaintiffs for allegedly violating the state’s charity care law, Consumer Protection Act and Fair Debt Collection Practices Act (FDCPA), Phillips and Geyman want the agency to stop pursuing collections from charity care- eligible patients.
They are also asking the court to make the agency establish procedures to allow patients to qualify for charity care that it collects on behalf of Washington hospitals, and notify current and former patients the agency has collected from in past four years that they may be eligible for charity care that may reduce their obligation. Under Washington statute RCW 70.170.060, individuals and families with annual incomes below 100 percent of the federal poverty level -- $10,400 for a single person and $42,400 for a family of four living in Washington -- are deemed charity care patients for the full amount of hospital charges, provided that they are not eligible for other public or private health coverage sponsorship. The law also requires various levels of discounts for patients’ whose annual incomes range from 100 percent and 300 percent of the federal poverty level. The law entitles charity care-eligible patients to who have paid all or portions of their hospital bills to a refund, according to the lawsuit.
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Self Pay StratificationAbove and Beyond the Call
Breakdown for XXX Healthcare Revenue by Percentage
High, 14%
Medium, 9%
Low, 4%
Charity, 2%Bad Debt, 55%
Needs More Data, 1%
No Data, 15% High
Medium
Low
Charity
Bad Debt
Needs More Data
No Data
Breakdown by RevenuePPI Amount
High $83,545.89Medium $55,296.18Low $22,687.62Charity $11,458.25Bad Debt $342,128.17Needs More Data $8,503.46No Data $92,213.56
Total: $615,833.13
Understand which accounts have the highest propensity for collection
Allocate resources on the accounts which offer the greatest ROI
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Work Flow OptimizationAbove and Beyond the Call
91
86
81
73
65
43
High
Medium
Low
Bad Debt
Need Data
No Data 1% to 3%
3% to 10%
.5% to 1%
10% to 15%
25% to 35%
50% to 65%
Projected Liquidation by Segment
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Work Flow OptimizationAbove and Beyond the Call
2006 2002
Total Charges Payments Percentage Total Charges Payments Percentage
High $217,017.82 $86,042.03 39.65% $235,506.34 $10,684.67 4.54%
Medium $153,286.05 $18,762.35 12.24% $117,089.43 $5,617.85 4.80%
Low $55,151.53 $2,493.36 4.52% $45,515.50 $1,130.32 2.48%
Charity $260,521.06 $6,498.28 2.49% $174,841.31 $1,617.43 0.93%
Bad Debt $1,183,922.13 $13,881.67 1.17% $520,329.68 $4,869.36 0.94%Needs More Data $85,433.16 $2,263.35 2.65% $53,804.80 $1,134.66 2.11%
No Data $103,264.75 $965.36 0.93% $60,236.93 $736.00 1.22%
Total: $2,058,596.50 $130,906.40 6.36% $1,207,323.99 $25,790.29 2.14%
2006 2002
Total Charges Payments Percentage Total Charges Payments Percentage
High $217,017.82 $86,042.03 39.65% $235,506.34 $10,684.67 4.54%
Medium $153,286.05 $18,762.35 12.24% $117,089.43 $5,617.85 4.80%
Low $55,151.53 $2,493.36 4.52% $45,515.50 $1,130.32 2.48%
Charity $260,521.06 $6,498.28 2.49% $174,841.31 $1,617.43 0.93%
Bad Debt $1,183,922.13 $13,881.67 1.17% $520,329.68 $4,869.36 0.94%Needs More Data $85,433.16 $2,263.35 2.65% $53,804.80 $1,134.66 2.11%
No Data $103,264.75 $965.36 0.93% $60,236.93 $736.00 1.22%
Total: $2,058,596.50 $130,906.40 6.36% $1,207,323.99 $25,790.29 2.14%
Analysis with Benchmarks and Targets
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Maximum Payment EstimatorAbove and Beyond the Call
Validate Stated Income via Credit Report
Estimated Income Baseline from Block Census Bureau Report and Validated via Credit Report
Income Estimation
Estimation of Assets via Credit History
Open Lines of Credit Available
Estimated Cost of Living in Geo-Demographic Area
Financial Profile
Amount the Patient Can Pay Without Dire Financial Duress
Maximum Payment
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Data ValidationAbove and Beyond the Call
Validation of Accounts
Sample of Patient Data
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Platform AlgorithmAbove and Beyond the Call
Patient Demographic
DataCredit Report
Financial Assessment
Algorithm
Estimated Income
Charity Recommendation
History from 15 million accounts
Client specific payment history
Maximum Payment Recommendation
Payment Propensity
Work-Flow Management
Key Attribute
Platform Deliverables
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Above and Beyond the Call
Measurable Results from Presumptive Charity Policy and Self
Pay Stratification
Reduced placements of self pay accounts to collection agencies by nearly 50% within first six months
Reduced FTE allocation for follow up on self pay accounts by 25%
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Increased cash receipts on self pay accounts by over 22% during first 90 days
Case Study
Reallocated 60% of FTE staff previously assigned to charity care application processing4
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Return On InvestmentAbove and Beyond the Call
Reduce internal cost by eliminating a minimum of 2 statements on bad debt segmented accounts thereby improving agency performance on least collectable accounts
Reduce charity administration costs by over 80%. (Industry trends indicate the average cost to compile a charity application is approximately $40)
Improve internal/external liquidation of self pay accounts by 25% to 40%
Capture uncollectible dollars sooner by accelerating Medicaid cost reporting on bad debt segmented accounts while allowing higher collectable accounts to remain at collection agency longer
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Secure Accurate Platform
Annual recalibration of cost of living index
Research any anomalies and validate
Quality control by dedicated IS staff
Secure server with redundant backups – 100% HIPAA compliant
Detailed reporting of non-matching data
Detailed reporting of missing data elements
Trends of registration performance are captured
Above and Beyond the Call
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Platform Delivery
Platform may be applied in real time at registration or in batch mode at any point in the revenue cycle
Integrated mode – assessment delivered through Nebo/Passport’s AMP real time platform (HL7 connection)
Batch mode data transferred via a secure FTP site (48 to 72 hours turnaround)
Batch data can be downloaded into internal patient account system
Above and Beyond the Call
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Notable FeaturesAbove and Beyond the Call
Charity methodology has been reviewed by states and passed general audit testing
Address verification can be bundled with charity model or applied as a stand alone
Competitive pricing
Low implementation costs
Rapid deployment of solution
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Thank YouAbove and Beyond the Call
Phil C. SolomonChief Client Officer UCB, [email protected]
Do You Have Any Questions?