the road to performance - first illinois chapter...

The Road to Performance

Evaluating Metrics and Benchmark Trends in the Revenue Cycle

June 2012

2 Confidential Services

1. philosophy2. resources3. framework


Benchmarking 101Benchmarking

• Identifies, understands, and adapts outstanding practices and processes to improve organizational performance

• Will be used increasingly by healthcare institutions to reduce expenses and simultaneously improve product and service quality

• Is an essential component of total quality management and is a continuous process by which an organization can measure and compare its own processes with those of organizations that are leaders in a particular area

• Can usually be classified into one of four categories: productivity, quality, time, and cost-related

• Can seem overwhelming but is vital

• Should be tackled one step at a time

• Can add millions to a company’s bottom line when departments are benchmarked individually



philosophy


1. Vision

2. Milestones

3. Indicators

4. Available Data

5. Pulling It All Together


define what success looks

like


integration into culture


“Much can be accomplished by teamwork when no one is concerned about who gets credit.”John Wooden


resources


you’re not alone


Source: “Transcription Turnaround Time for Common Document Types,” 2008 developed by the American Health Information Management Association and Medical Transcription Industry Association (AHIMA/MTIA) Joint Task Force on Standards Development


HARA Metrics and Projections• Hospitals have seen GDRO days range between 55-50 days over the past 10 years and

will most likely continue this trend as a result of challenges presented by HIPAA 5010, ICD-10, and healthcare reform

• Source: HARA 2011 reports


HARA Metrics and Projections

• A/R aging has ranged between 22-27% and is expected to continue to rise, especially during the transition to HIPAA 5010



HARA and Projections• U.S. hospitals are predicted to continue to see increases in total gross revenue written

off as bad debt or charity, which is impacted heavily by a weak economy and unemployment



HARA Metrics and Projections• The nation’s hospitals have submitted claims to all payer types from approximately 9

days to 13 days and will most likely see this rise as well in early 2012 during the transition to HIPAA 5010



framework


Creating a Results-Driven ProcessIn order to benchmark successfully:

1. Select the processes you want to benchmark (e.g., Billing, Collections, etc.)

2. Understand specifically what your department’s problems are and clearly define what you intend to study and accomplish

3. Choose relevant measurements and those that have solid industry comparative benchmark data

4. Establish baselines and targets for the metrics you have selected and develop a benchmark comparison similar to the following:

Revenue Cycle Scorecard

Indicator Target Month 1 Month 2 Month 3

Patient AccessRegistry Accuracy >98% 90% 92% 93%

HIMDNFB daysCoding Accuracy Rate

<3>99%

4.594%

495%

4.793%

PFSGross Days in A/R% of A/R > 90 days

<50<15

6533%

6230%

6029%


Creating a Results-Driven ProcessIn order to benchmark successfully:

5. Study performance-boosting best practices, including talking to colleagues outside your organization. Participate in national associations, member blogs, and other appropriate listservs that provide discussion groups.

6. Conduct a literature search and attend educational programs to learn about best practices and adapt the most appropriate that will help achieve the results you need. Do not confine your search to your own industry—there may be comparable processes in an entirely different industry from which you can learn.

7. Consider benchmarking with organizations that are roughly the same size as your own and in a similar region as your organization, because their best practices will be more likely to work in your organization.

8. Plan for and implement best practices. Decide which practices can be adapted to your organization. With staff support, move forward and make the necessary proposals and budget requests, develop policies and procedures, conduct required training, and implement new technologies.


Creating a Results-Driven Process• In order to

benchmark successfully:9. Determine the

potential dollar value to your organization if you were to achieve the benchmark targets similar to the following:

ABC Hospital

Annualized Cash Before Improvement $240,838,385

Benefit Forecast (Thousands)

Ongoing Cash OpportunityOPPORTUNITY

100% 75% 50%

Bad Debt Write-Off Reduction (a)POS Collections, Patient Balances, Charity/Medicaid

$1,659 $1,244 $829

Denials Management Reduction (b)Small Bal Vendor, Implement Projects & Technology

$2,132 $1,599 $1,066

Additional Entitled New Revenue (c)Clinical Documentation, Charge Capture Audit, Coding Improvements

$3,198 $2,399 $1,599

Time of Service Collections (d) $2,132 $1,599$1,066

Total Ongoing Opportunity (P/L Impact) $9,121 $6,841 $4,561

Percentage of Annualized Cash 3.8% 2.8% 1.9%

One-Time Cash Flow ImpactOPPORTUNITY

100% 75% 50%

DNFB Improvement (e) $15,332 $11,499 $7,666

Billed Days in A/R Improvement (f) $7,520 $5,640 $3,760

Total Opportunity – Cash Acceleration $22,852 $17,139 $11,426

Percentage of Annualized Cash 13.3% 10.0% 6.6%

Total Ongoing Over Years 2 & 3 $18,243 $13,682 $9,121

TOTAL OPPORTUNITY OVER 3 YEARS $50,216 $37,662 $25,108


Creating a Results-Driven Process

In order to benchmark successfully:10. Measure results and do a payback

analysis. Assess the progress your organization has made by comparing baseline data with current performance. Document the costs incurred and the benefits that have resulted. Monitor quality to make sure improvements in performance are maintained. Periodically raise the bar or change the process for continuous improvement.



Top 10 Things Not To Do

1. Get stuck in a rut

2. Set your goals too large

3. Bring reams and reams of paper to the meetings

4. Try and do it all yourself

5. Assume that someone else in the organization is doing it

6. Analyze benchmarks in a silo

7. Let technology stifle your goals

8. Push the information out to your team

9. Use benchmark meetings as a way to point out flaws in coworkers and the organization

10. Just kidding – there are only 9


Top 10 Things to Do1. Keep your benchmark meetings short and concise – set up

subgroups to meet separately to identify issues and develop action plans

2. Setup annual reflection/goal setting days

3. Communicate to all relevant employees why you are tracking benchmarks

4. Include the right people

5. “Arm Wrestle” your CEO or CFO into letting you attend the national MAP event

6. Question the numbers over and over again

7. Pictorialize your goals

8. Ensure that you have access to the right data from associations on a timely basis

9. Reward success

10. Stay the course and bring chocolate to meetings


?

Thank youJim GarvinVice President of Solution Development(636) [email protected]


Appendix


HFMA Map Metrics

HFMA periodically publishes best practice targets for revenue cycle areas including:


AHIMA Metrics

• Some other sample AHIMA productivity benchmarks include:

Source: Using Benchmarking for Performance Improvement, (2003 AHIMA Practice Brief

ServicesConfidential

Case Study: Health System in the SouthwestBenchmarking in Practice

• Started system-wide benchmarking in 2004• Wanted to create streamlined and consistent reporting for revenue cycle information• Used various methods and systems in each hospital for calculating and reporting revenue cycle

information• Decided to develop one standard scorecard that each facility would use to report revenue cycle metrics

Challenges Action Taken Benefits

• Deciding what data and benchmarks would depict the health of the revenue cycle across all hospitals

• Apples-to-apples comparison of data

• The necessary data had to be readily available

• Deciding what targets to use based on HFMA, HARA, and other sources

• Gaining buy-in from staff about the changes being implemented

• Six major areas were selected to be monitored, including revenue outcomes, registration, and pre-service coordination, HIM, case management, contracting and revenue recovery, and patient account services

• Targets were established for all of the goals in the six areas and monthly reporting started; at year end, a revenue integrity meeting is held, and facilities receive awards and recognition

• Sense of camaraderie and healthy competition among the facilities

• The scorecard has evolved from being an excellent executive report to an excellent education tool

• Net revenue increase of 24% over the past 6 years

• Increase in cash collections of ~ 13% and a decrease in A/R days from 78 days to 42 days

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ServicesConfidential

Case Study: Large Physician ClinicBenchmarking in Practice

• An HIM director at a large physician clinic had 21 transcriptionists• Each averaged about 140 lines per hour using conventional word processing software

and cassette tapes• The transcription unit supports 80 physicians at a cost of 15 cents per line

Challenges Action Taken Benefits

• Needed to increase productivity while maintaining quality

• Transcription processes were not state-of-the-art in the organization

• Little knowledge of benchmarks or appropriate targets

• HIM director determined that in similar settings, 1 transcriptionist supports 4 physicians, and researched transcription best practices on the AHIMA and American Association for Medical Transcription websites and in AHIMA’s Communities of Practice

• Talked to peers on local HIM association board and posted a discussion thread on the Ambulatory Care Community of Practice; attended a national convention, visited vendors, attended lectures on best practices and transcription technology, and identified goals for lines/hour and cost per line

• Identified 10 transcription departments of similar size and scope and interviewed the HIM director or transcription manager at each; decided to pursue new software, templates, and a digital dictation system; planned for an incentive program and explored allowing transcriptionists to work from home

• Productivity continues to increase with an expected average of 275 lines per transcriptionist

• Cost per line is expected to decrease to approximately 12 cents per line

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