Browse by Topic
Learn more about the healthcare finance industry's leading professional association. Find out why our members rely on HFMA as their go-to source for insight and information.
Members have many options for helping them advance their careers. Conferences, seminars, eLearning, certification, and more -- our education and events will keep you motivated.
Strategize for success with the nation's top performers at HFMA's Revenue Cycle Conference (MAP Event) from Sept. 25-27 in Phoenix, Arizona. Register now.
Learn about timely healthcare industry topics and earn CPEs with HFMA live and on-demand webinars. View the latest schedule.
Stay up-to-date in a rapidly changing industry in San Diego (August 10-12). Register early and save.
Our newsletters offer targeted articles with
technical how-to details and thought-provoking insights from healthcare finance
leaders and industry experts.
The Helen Yerger/L. Vann Seawell Best Article
Award recognizes articles for outstanding editorial achievement in hfm
Information about leading vendors helps your buying decisions.
Forum members can network during live webinars or access a library of past webinars on topics such as ICD-10 implementation, CMS audits, bundled payment, charity care, KPIs, and more.
An ever-expanding collection of spreadsheets, policies, job descriptions, checklists, and more that you can adopt and adapt.
Forum members can submit vexing questions to a panel of experts using our Ask the Expert service.
Your source for employment solutions.
Find new employment opportunities or
reach out to qualified candidates.
Distinguish yourself as a leader among your peers and advance your career by earning certification in our healthcare finance programs.
Get an objective third-party evaluation of products and services used in the healthcare finance workplace.
MAP App is a web-based application that helps organizations improve revenue cycle performance based on industry-standard metrics called MAP Keys.
Find suppliers and products in this comprehensive vendor directory for healthcare finance professionals.
Guidance for understanding and communicating about the price of health care.
Transformation toward value-based healthcare is reshaping the delivery of care, patient expectations, and payment structures.
Improve your revenue cycle performance through standard metrics, peer comparison, and successful practices.
Note: FASB is currently working on updated guidance on mergers and acquisitions by a not-for-profit organization. Current information on this work is available
on FASB's web site .
Guidance for the for-profit sector is available in FASB Statements No. 160, No. 141(r), and Statement No. 141.
Note on Statement 20: Mergers, Acquisitions, and Collaborations
The Principles and Practices Board undertook this position statement to assist in the identification and use of the appropriate accounting methodology for reporting mergers, acquisitions and collaborations. Generally accepted accounting principles related to business combinations do not specifically address the distinctive characteristics involving not-for-profit healthcare entities (e.g., existence of non-stock corporations) or transactions between a not-for-profit and for-profit entity. This statement interprets and applies the conclusions of existing accounting literature to transactions involving not-for-profit healthcare entities. An exposure draft of this statement was issued on July 17, 1996. The HFMA Board approved the release of this statement on August 11, 1997.
An exposure draft of this statement was originally issued on July 14, 1995. This statement was published in Healthcare Financial Management in June 1996. Technical references in the statement were updated in August 1996 after the release of the AICPA's Audit and Accounting Guide, Healthcare Organizations and the AICPA's Audit and Accounting Guide, Not-for-Profit Organizations.
1.1 This Principles & Practices Board position statement will assist healthcare financial managers entering into mergers, acquisitions, or collaborations identify and utilize the appropriate accounting methodology for reporting business combinations and collaborations. This statement interprets and applies the conclusions of existing accounting literature to transactions involving not-for-profit healthcare entities. The statement focusses on transactions among not-for-profit entities (or between a not-for-profit and for-profit entity) because generally accepted accounting principles related to business combinations do not specifically address the distinctive characteristics (e.g., existence of non-stock corporations) of these organizations and transactions.
1.2 Statement on Auditing Standard (SAS) No. 69, The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles in the Independent Auditor's Report, establishes the hierarchy of generally accepted accounting principles (GAAP). The hierarchy of GAAP establishes the order in which accounting principles established by the Financial Accounting Standards Board (FASB), Governmental Accounting Standards Board (GASB), and American Institute of Certified Public Accountants (AICPA) should be followed. If there are no established principles for a particular issue, other accounting literature (level(e)) should be used. The interpretations contained in this statement are level (e) in the hierarchy of GAAP.
1.3 The conclusions contained within are generally intended to apply to transactions involving governmental healthcare organizations. Paragraph 6 of GASB Statement No. 20, Accounting and Financial Reporting for Proprietary Funds and Other Governmental Entities That Use Proprietary Fund Accounting, indicates that governmental proprietary activities, such as governmental healthcare organizations, should apply all applicable GASB pronouncements as well as any FASB Statements and Interpretations, Accounting Principles Board (APB) Opinions, and Accounting Research Bulletins (ARBs) issued on or before November 30, 1989, that do not conflict with or contradict GASB pronouncements. Furthermore, paragraph 7 of GASB 20 provides that governmental proprietary activities may apply all FASB Statements and Interpretations issued after November 30, 1989, on a "all or none" basis.
1.4 The Health Care Financing Administration's Provider Reimbursement Manual (HCFA Publication 15, Part I, paragraph 104) addresses the purchase of a facility as an on-going operation, and the Intermediary Manual (HCFA Publication 13, Chapter 6) addresses change of ownership for those healthcare entities that participate in the Medicare program. A discussion of reporting business combinations in accordance with Medicare and other reimbursement regulations is beyond the scope of this statement.
1.5 The Internal Revenue Service and other federal and state regulatory agencies have separate rules and regulations that apply to changes in ownership. These federal and state requirements are beyond the scope of this statement but should be carefully considered when planning any business combination or collaboration
2.1 Healthcare business combinations should be accounted for as "similar to a purchase" or "similar to a pooling of interests" (hereafter referred to as a pooling of interests), depending on the circumstances. Alternatively, collaborations among healthcare entities resulting in shared control should be accounted for as a joint venture. These methods of accounting are not alternatives for recording a transaction; the appropriate method depends on the characteristics of the transaction, and all aspects of the transaction should be accounted for in accordance with the applicable method. Knowledge of the characteristics that trigger the accounting for a business combination or collaboration by a prescribed method will be useful to financial managers when planning these transactions.
2.2 The AICPA Audit and Accounting Guide, Health Care Organizations (the audit guide), APB No. 16, Business Combinations (issued in 1970 and applicable to for-profit business enterprises), and APB No. 18, Equity Method for Investments in Common Stock, contain the fundamental accounting principles for business combinations and collaborations.
2.3 Control is a key attribute in determining the relationship between entities and in identifying the appropriate method of accounting for mergers, acquisitions, and collaborations. Chapter 11 of the audit guide defines control as the "direct or indirect ability to determine the direction of management and policies through ownership, contract, or otherwise. However, the rights and powers of the controlling entity may vary depending on the legal structure of the controlled entity and the nature of control." [paragraph 11.08] Applying existing accounting guidance to business combinations involving not-for-profit entities is often difficult because ownership percentages are not easily measurable or as clearly defined as in for-profit entities. Not-for-profit organizations exist in various legal forms evidenced by documents such as ownership, membership, or stock certificates, or joint venture or partnership agreements. It is, therefore, important to carefully consider the substance of these transactions when determining the appropriate accounting treatment to use.
2.4 Financial managers should be aware that FASB is presently engaged in several projects that relate, directly or indirectly, to accounting for mergers, acquisitions, and collaborations. These projects include:
The status of these projects should be monitored for additional guidance in the area of mergers, acquisitions, and collaborations.
3.1 "Nearly two in five of the nation's 5,200 nonfederal hospitals have been involved in merger and acquisition activity" between 1994 and 1996, according to Modern Healthcare. This activity is the result of an effort by healthcare organizations to provide their communities with quality healthcare services in a more efficient and cost-effective manner. Integrated healthcare delivery systems are forming as a result of business combinations between existing for-profit and not-for-profit hospitals, physician groups, ambulatory providers, long-term care providers, or other non-acute providers, and may include a third party payer component. The single integrated delivery system brings together and carries on the activities of the previously separate, independent entities. Integrated healthcare networks hope to attain synergy and economies of scale that include: more efficient use of personnel, medical supplies, plant and equipment, and other overhead costs (laundry, medical records, accounting, etc.); broader geographic coverage of patient populations; higher quality of care; and the ability to offer new services and products. Mergers, acquisitions, and collaborations allow organizations to enter new markets, such as the insurance industry, quickly.
3.2 Healthcare mergers, acquisitions, and collaborations may be horizontal, vertical, or both horizontal and vertical in nature. A horizontal combination is the merging of two entities in the same industry, operating in the same business segment. A vertical combination is the merging of entities that are in the same industry but operate within different segments of that industry, such as the merging of a medical group practice and a hospital.
4.1 The first step in determining the appropriate accounting treatment for a merger or acquisition involving not-for-profit healthcare organizations is to ascertain whether consideration has been exchanged. The audit guide indicates that a transaction involving the receipt or payment of monetary consideration or change in legal title to assets and/or the assumption of liabilities is "similar to a purchase under APB 16." [paragraph 11.28]1 Change in legal title to assets or assumption of liabilities constitutes consideration when the seller transfers title to assets to, or is relieved of its liabilities by, the buyer in exchange for the acquired entity.
4.2 The definition of the purchase method of accounting according to APB 16 is as follows:
The purchase method accounts for a business combination as the acquisition of one company by another. [paragraph 11]
4.3 The acquiring entity records the assets acquired at the fair value of the assets exchanged, present value of the liabilities to be paid and other obligations assumed, or the fair value of shares of stock issued, depending on the nature of the transaction. Often, the fair value exchanged does not equal the book value of the assets and liabilities of the acquired entity. The fair value of the acquired entity's assets and liabilities will have to be determined (an appraisal may be required) and increases (or decreases) will have to be assigned.
4.4 Goodwill in a purchase transaction is discussed in paragraph 87 of APB 16. Addressing the recording of assets acquired and liabilities assumed, paragraph 87 states:
First, all identifiable assets acquired... and liabilities assumed in a business combination...should be assigned a portion of the cost of the acquired company, normally equal to their fair values at date of acquisition.
Second, the excess of the cost of the acquired company over the sum of the amounts assigned to identifiable assets acquired less liabilities assumed should be recorded as goodwill. The sum of the market or appraisal values of identifiable assets acquired less liabilities assumed may sometimes exceed the cost of the acquired company. If so, the values otherwise assignable to noncurrent assets acquired (except long-term investments in marketable securities) should be reduced by a proportionate part of the excess to determine the assigned values. A deferred credit for an excess of assigned value of identifiable assets over cost of an acquired company (sometimes called "negative goodwill") should not be recorded unless those assets are reduced to zero value.
4.5 Only direct acquisition costs, such as legal and accounting fees related to drafting the acquisition agreement, are included in the cost of the acquisition. However, indirect and general expenses, such as salaries and overhead costs, related to acquisitions are treated as operating expenses in the period in which they were incurred.
4.6 The reported income of an acquiring entity includes the operations of the acquired entity from the date of acquisition. Financial information from prior periods is not restated.
4.7 The footnotes of the acquiring entity must disclose, among other things, detailed information regarding the acquisition, including the name and a brief description of the acquired entity, the period for which results of operations of the acquired entity are included in the income statement of the acquiring entity, and the cost of the acquired entity. The footnotes of the acquiring entity may be required to disclose the effect of the purchase on its net income as if the purchase had occurred at the beginning of the period presented.
5.1 If the first step in determining the appropriate accounting treatment for a merger or acquisition involving not-for-profit healthcare organizations indicates that consideration, as discussed in paragraph 4.1 above, has not been exchanged, the combination may qualify for the pooling of interests method of accounting.
5.2 The following is the definition of the pooling of interests method according to APB 16:
The pooling of interests method accounts for a business combination as the uniting of ownership interests of two or more entities by exchange of equity securities. No acquisition is recognized because the combination is accomplished without disbursing resources of the constituents. Ownership interests continue and the former bases of accounting are retained. [paragraph 12]
5.3 APB 16 sets forth the distinctive conditions for a business combination to be accounted for under the pooling of interests method. The purpose of these conditions is to ensure that the pooling of interests method of accounting presents "as a single interest two or more common stockholder interests which were previously independent and the combined rights and risks represented by those interests." [paragraph 45] The conditions do not directly relate to not-for-profit entities (several conditions are related to the exchange of stock) and, therefore, are difficult to apply to a combination among not-for-profit entities.
5.4 In the audit guide, the AICPA Accounting Standards Executive Committee concluded that:
...circumstances exist under which reporting on the combination of two or more not-for-profit organizations (or that of a not-for-profit organization with a formerly for-profit entity) by the pooling of interest method better reflects the substance of the transaction than reporting by the purchase method. Therefore, not-for-profit organizations are, under certain circumstances, permitted to report by the pooling of interests method, even though they generally do not issue common stock. Such circumstances include the combination of two or more entities to form a new entity without the exchange of consideration. [paragraph 1.33]
5.5 The audit guide indicates that a change in control (for example, change in sole corporate member) is a circumstance that is similar to a pooling of interests transaction under APB 16. [paragraph 11.28] The audit guide does not provide guidance for applying the pooling of interests conditions as set forth in APB 16 to a business combination involving not-for-profit entities. Instead, the audit guide indicates that APB 16 "may provide a useful framework when evaluating similar transactions entered into by not-for-profit health care business organizations." [paragraph 11.28] Literal adherence to the conditions is not possible in a business combination involving not-for-profit entities. If examined, the conditions should be interpreted in light of each transaction's facts and circumstances, recognizing that the relevant criteria may be characterized differently in not-for-profit entities than in for-profit entities.
5.6 There is no step-up or reduction in basis of the assets of the combining entities. The recorded assets and liabilities of the formerly separate entities become the recorded assets and liabilities of the combined entity at the historical cost basis of the separate entities prior to the combination. Equity is combined as part of the pooling of interests method.
5.7 Goodwill is not recorded in a business combination accounted for using the pooling of interests method. The recorded assets and liabilities of the combining entities become the recorded assets and liabilities of the combined entity; therefore, goodwill is not a consideration.
5.8 Transaction costs incurred due to the combination are recorded as operating expenses of the combined entity.
5.9 Results of operations should be combined from the beginning of the period in which the combination occurs. Prior year information presented in the financial statements should also be restated on a combined basis for comparative purposes.
5.10 The footnotes of the combined entity should disclose, among other things, the revenue, extraordinary items, and net income or excess of revenues over expenses of each of the previously separate entities for the periods prior to the date of the combination that are included in the current combined net income.
6.1 APB 18 defines a corporate joint venture as:
...a corporation owned and operated by a small group of businesses (the "joint venturers") as a separate and specific business or project for the mutual benefit of the members of the group. A government may also be a member of the group. The purpose of a corporate joint venture frequently is to share risks and rewards in developing a new market product or technology; to combine complementary technological knowledge; or to pool resources in developing production or other facilities. A corporate joint venture also usually provides an arrangement under which each joint venturer may participate, directly or indirectly, in the overall management of the joint venture. Joint venturers thus have an interest or relationship other than as passive investors. [paragraph 3]
This definition also applies to other forms of joint ventures.
6.2 Joint ventures are typically characterized by joint funding of resources by the investors, relationships defined and governed by an agreement, and joint control. Each investor commonly participates in overall management regardless of the percentage of ownership, and significant decisions commonly require the consent of each of the investors so that no individual investor has unilateral control, that is, the ability to unilaterally make 100 percent of the decisions.
6.3 Although investors share control of the venture, it is important to note that one investor may contribute a disproportionate amount to the joint venture or may have a disproportionate economic interest in the venture. However, as long as no single investor controls the venture, the arrangement still meets the definition of a joint venture. This may be the case even when one investor has a disproportionately higher share of the earnings. If key decisions require a super majority, then there still may be joint control.
6.4 APB 18 provides guidance on accounting for investments in corporate joint ventures. AICPA Interpretation No. 2, Investments in Partnerships and Ventures, of APB 18 indicates that many of the provisions of APB 18 also are appropriate in accounting for investments in partnerships and unincorporated entities. These pronouncements indicate that the equity method of accounting is generally appropriate for investments in joint ventures. As a general rule, the investor should record its contribution to a joint venture at cost (the amount of cash contributed and the book value of other nonmonetary assets contributed).
6.5 Financial managers should be aware that gain or loss recognition may be required upon the formation of a joint venture. Opinions vary on whether a gain should be recognized by an investor contributing appreciated nonmonetary assets to a joint venture. Some believe a gain, equal to the appreciation of the contributed assets, should be recognized. On the other hand, others believe the contribution of cash or other nonmonetary assets does not result in the culmination of the earnings process and, therefore, a gain should not be recognized. Loss recognition upon a contribution to a joint venture may be appropriate where the joint venture arrangement indicates that an impairment of value of the nonmonetary assets contributed has occurred. Recognition of gain or loss upon the formation of a joint venture is beyond the scope of this statement. Financial managers should refer to APB No. 29, Accounting for Nonmonetary Transactions, AICPA Statement of Position No. 78-9, Accounting for Investments in Real Estate Ventures, and SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets To Be Disposed Of, for guidance.
6.6 After the initial investment in the joint venture, the carrying amount of the investment is increased to reflect the investor's share of income of the venture and is reduced to reflect the investor's share of losses of the venture and dividends or distributions received from the venture. The investor's share of the income or losses of the venture is included in the investor's net income as the venture reports them. Adjustments similar to those made in preparing consolidated financial statements, such as elimination of intercompany gains and losses and amortization of the difference between cost and underlying equity in net assets, also are applicable to the equity method.
6.7 An investor's share of the earnings or losses of a joint venture is determined by its ownership percentage, unless specific allocation formulas in the joint venture agreement differ. The determination of ownership percentages is dependent on the legal form of the joint venture. A corporate for-profit joint venture's ownership is based on the shares of common stock held by the investors. The percentage of ownership in a corporate not-for-profit joint venture is not as direct and may be indicated by the percentage of board seats an investor holds, asset distribution percentages applicable upon dissolution, or the percentage of net assets contributed to the joint venture. Regardless of legal form, investor ownership percentages and the means for sharing profits and losses, as well as asset distribution, should be established in the planning process and clearly stated in the joint venture agreement.
6.8 Goodwill is a consideration in the formation of a joint venture. There may be a difference between the carrying amount of an investor's investment in a joint venture and its underlying equity in the net assets of the joint venture. An example would be when appreciated nonmonetary assets are contributed to a joint venture and the investor records its investment at a value that varies from the amount recorded by the joint venture. APB 18 states, "A difference between the cost of an investment and the amount of underlying equity in net assets of an investee should be accounted for as if the investee were a consolidated subsidiary." [paragraph 19] Accordingly, the difference--goodwill--should be attributed to the investor's proportionate interest in the joint venture and should be appropriately amortized over the estimated useful lives of the respective assets.
6.9 Little specific guidance exists for capitalizing and expensing organization costs. In April 1997, the AICPA issued an exposure draft of a proposed SOP titled Reporting on the Costs of Start-Up Activities. The proposed SOP would require the costs of start-up activities to be expensed as incurred. Organization costs, defined as the "costs of preparing: (1) the entity charter; (2) the partnership agreement; (3) the bylaws; (4) the minutes of organizational meetings; and (5) the terms of original stock certificates," as well as activities related to a merger or acquisition, are outside the scope of the proposed SOP. Start-up activities are defined "broadly as those one-time activities related to opening a new facility, introducing a new product or service, conducting business in a new territory, conducting business with a new class of customer or beneficiary, initiating a new process in an existing facility, or commencing some new operation," according to the exposure draft. Kohler's Dictionary defines organization costs as:
Any cost incurred in establishing a corporation or other form of organization; as, incorporation, legal and accounting fees, promotional costs incident to the sale of securities, security-qualification expense, and printing of stock certificates. These and similar costs constitute, theoretically, an intangible asset of value which continues throughout the life of the corporation and hence, strictly, do not constitute a deferred charge. However, because the total usually is not large, it has become customary to write off such costs arbitrarily either at once or over the first few years of corporate existence. Under Section 248 of the Internal Revenue Code, organization expenditures of a corporation (such as those for legal and similar services to obtain a charter, fees paid to the state, and expenses of temporary directors) may be amortized over a 60-month period [page 364]
6.10 The equity method shows the investment in the joint venture in the balance sheet of an investor as a single amount, and the investor's share of earnings or losses in a joint venture is shown in the income statement as a single amount. As discussed earlier, joint ventures, by their nature, are arrangements in which no one investor has control of the venture. Therefore, individual investors should not prepare consolidated financial statements which include the results of the joint venture.
6.11 If an investor uses the equity method of accounting for a joint venture and the joint venture is significant in relation to the investor's financial position and results of operations, the investor should disclose, among other things, the name and the percentage of ownership it has in the joint venture(s). Summarized information related to assets, liabilities, and results of operations should be presented in the footnotes.
7.1 Healthcare business combinations should be accounted for as similar to a purchase or similar to a pooling of interests, depending on the circumstances. Collaborations among healthcare entities in which control is shared among investors should be accounted for as a joint venture.
7.2 A purchase represents the acquisition of one entity by another and consideration must be part of the transaction. Under the purchase method, the assets and liabilities of the acquired entity are stepped up to fair market value.
7.3 A pooling of interests represents a transaction uniting ownership interests with no consideration. Under the pooling of interests method, there is no step-up in basis of the assets and liabilities of the combining entities.
7.4 A joint venture represents an undertaking owned and operated by a group of businesses as a separate business or project for the mutual benefit of the members of the group. Under joint venture accounting, there is usually no step-up in basis of the assets invested in the joint venture.
Eugene R. Curcio, FHFMA, CPA
Mark Doak, FHFMA, CPA
Daniel F. Governile, CPA (term expired 6/97) Robbin R. Grill, CPA (term expired 6/97) Manfred Heinzeller, CPA
Catherine A. Jacobson, CPA
Maribess L. Miller, CPA
Kenneth C. Robinson, FHFMA, CPA
John J. Sheehan, CPA
Kirby O. Smith, FHFMA
Donn A. Szaro, CPA
Connie R. Williams, FHFMA, CPA
John E. Yox, FHFMA
Richard L. Gundling, FHFMA, CMA
Angelika P. Maske, CPA
1. These statements from paragraph 11.28 are predicated by the following:
The dynamics of change in the health care industry have resulted in increased business combinations as new organizational structures are being formed. APB Opinion No. 16 provides guidance regarding business combinations concerning for-profit business enterprises and may provide a useful framework when evaluating similar transactions entered into by not-for-profit health care business organizations.
Publication Date: Monday, August 11, 1997
In this Business Profile, Bruce Haupt, president and CEO of ClearBalance, discusses how a patient loan program can increase patient collections, reduce bad debt, and speed cash flow.
Patient financial engagement is more challenging than ever – and more critical. With patient responsibility as a percentage of revenue on the rise, providers have seen their billing-related costs and accounts receivable levels increase. If increasing collection yield and reducing costs are a priority for your organization, the metrics outlined in this presentation will provide the framework you need to understand what’s working and what’s not, in order to guide your overall patient financial engagement initiatives and optimize results.
In this Business Profile, Jerry Bruno, principal with Deloitte Consulting LLP, discusses the importance of choosing revenue cycle solutions that help an organization meet the challenges of a quickly evolving healthcare environment.
No two patients are the same. Each has a very personal healthcare experience, and each has distinct financial needs and preferences that have an impact on how, when and if they chose to pay their healthcare bill. It’s no longer effective to apply static billing techniques to solve the complex challenge of collecting balances from patients. The need to tailor financial conversations and payment options to individual needs and preferences is critical. This presentation provides 10 recommendations that will not only help you improve payment performance through a more tailored approach, but take control of rising collection costs.
In this business profile, Lane Jackson, a partner in the Grant Thornton LLP Health Care Advisory Services practice, with extensive experience in overseeing system implementations and revenue cycle reorganizations, discusses best practices for elevating revenue cycle performance during an EMR implementation. Grant Thornton LLP is a sponsor of the Large System Controllers Council Affinity Group.
This white paper, written by Apex Vice President of Solutions and Services, Carrie Romandine, discusses the importance of patient segmentation and messaging specifically related to the patient revenue cycle. Applying strategic messaging that is tailored to each patient type will not only better educate consumers on payment options specific to their billing needs, but it will maximize the amount collected before sending to collections. Further, targeted messaging should be applied across all points of patient interaction (i.e. point of service, customer service, patient statements) and analyzed regularly for maximized results.
In this business profile, Amy Gross, senior vice president of Key Government Finance, discusses the benefits of private placement transactions to support large-scale financing projects.
This white paper, written by Apex President Patrick Maurer, discusses methods to increase patient adoption of online payments. Providers are now seeking ways to incrementally collect more payments due from patients as well as speeding up the rate of collections. This white paper shows why patient-centric approaches to online payment portals are important complements to traditional provider-centric approaches.
In this business profile, Doug Polasky, executive vice president at Xtend Healthcare, explains the importance of having sound workflow processes in a consolidated business office to ensure optimal performance and reduce costs.
Increased electronic engagement between healthcare providers and patients provides significant opportunities for improving revenue cycle metrics and encouraging patients to access EHRs. This article, written by Apex Founder and CEO Brian Kueppers, explores a number of strategies to create synergy between patient billing, online payment portals and electronic health record (EHR) software to realize a high ROI in speed to payment, patient satisfaction and portal adoption for meaningful use.
In this business profile, sponsored by SSI, Jay Colfer, vice president of sales and marketing, shares how patient access solutions are reversing the trend toward increased bad debt resulting from the rise in high-deductible consumer health plans.
Faced with a rising tide of bad debt, a large Southeastern healthcare system was seeing a sharp decline in net patient revenues. The need to improve collections was dire. By integrating critical tools and processes, the health system was able to increase online payments and improve its financial position. Taking a holistic approach increased overall collection yield by 10% while costs came down because the number of statements sent to patients fell by 10%, which equated to a $1.3M annualized improvement in patient cash over a six-month period. This case study explains how.
In this business profile of Deloitte Consulting, Matthew Hitch and David Betts explore the potential benefits of elevating the customer experience and outline strategies to change service delivery.
With the ICD10 deadline quickly approaching and daily responsibilities not slowing down, final preparations for October 1 require strategic prioritization and laser focus.
TriMedx helps health systems control costs and uncover savings opportunities by optimizing the clinical engineering function.
Read how Gwinnett Medical Center provides clear connections to financial information, offers multiple payment options for patients, and gives onsite staff the ability to collect payments at multiple points throughout the care process.
Read how Orlando Health was able to perform deeper dives into claims data to help the health system see claim rejections more quickly–even on the front end–and reduce A/R days.
To maintain fiscal fitness and boost patient satisfaction and loyalty, healthcare providers need visibility into when and how much they will be paid–by whom–and the ability to better navigate obstacles to payment. They need payment clarity. This whitepaper illuminates this concept that is winning fans at forward-thinking hospitals.
Financial services staff are always looking for ways to improve the verification, billing and collections processes, and Munson Healthcare is no different. Read about how they streamlined the billing process to produce cleaner bills on the front end and helped financial services staff collect more than $1 million in additional upfront annual revenue in one year.
Effective revenue cycle management can be a challenge for any hospital, but for smaller providers it is even tougher. Read how Wallace Thomson identified unreimbursed procedures, streamlined claims management, and improved its ability to determine charity eligibility.
Before launching an energy-efficiency initiative, it’s important to build a solid business case and understand the funding options and potential incentives that are available. Healthcare leaders should consider taking the steps outlined in the whitepaper to ease the process of gaining approval, piloting, implementing, and supporting sustainability projects. You will find that investing in sustainability and energy efficiency helps hospitals add cash to their bottom line. Discover how hospitals and health systems have various options for funding energy-efficient and renewable-energy initiatives, depending on their current financial structure and strategy.
Health care is a dynamic mergers and acquisitions market with numerous hospitals and health systems contemplating or pursuing formal arrangements with other entities. These relationships often pose a strategic benefit, such as enhancing competencies across the continuum, facilitating economies of scale, or giving the participants a competitive advantage in a crowded market. Underpinning any profitable acquisition is a robust capital planning strategy that ensures an organization reserves sufficient funds and efficiently onboards partners that advance the enterprise mission and values.
The success of healthcare mergers, acquisitions, and other affiliations is predicated in part on available capital, and the need for and sources of funding are considerations present throughout the partnering process, from choosing a partner to evaluating an arrangement’s capital needs to selecting an integration model to finding the right money source to finance the deal. This whitepaper offers several strategies that health system leaders have used to assess and manage capital needs for their growing networks.
Announcements from several commercial payers and the Centers for Medicare and Medicaid Services (CMS) early in 2015 around increased efforts to form value-based contracts with providers seemed to point to an impending rise in risk-based contracting. Rather than wait for disruption from the outside in, health care providers are now making inroads on collaborating with payers on various risk-based contracting models to increase the value of health care from within.
Yuma Regional Medical Center (YRMC) is a not-for-profit hospital serving a population of roughly 200,000 in Yuma and the surrounding communities.
Before becoming a ZirMed client, Yuma was attempting to manually monitor hundreds of thousands of charges which led to significant charge capture leakage. Learn how Yuma & ZirMed worked together to address underlying collections issues at the front end, thus increasing Yuma’s overall bottom line.
Kindred Hospital Rehabilitation Services works with partners to audit the market and the facility’s role in that market to identify opportunities for improvement. This approach leads to successes; Kindred’s clinical rehab and management expertise complements our partners’ strengths. Every facility and challenge is unique, and requires a full objective analysis.
As the critical link between patient care and reimbursement, health information enables more complete and accurate revenue capture. This 5-Minute White Paper Briefing shares how to achieve cost-effective revenue integrity by your optimizing HIM systems.
Speedier cash flow starts with better CDI and coding. This 5-Minute White Paper Briefing explains how providers can improve vital measures of technical and business performance to accelerate cash flow.
Qualified coders are getting harder to come by, and even the most seasoned professional can struggle with the complexity of ICD-10. This 5-Minute White Paper Briefing explains how partnerships can help improve coding and other key RCM operations potentially at a cost savings.
The point of managing your revenue cycle isn’t just to improve revenue and cash flow. It’s to do those things effectively by consistently following best practices— while spending as little time, money, and energy on them as possible.
How Lucile Packard Children’s Hospital Stanford increased payments received within 45 days by 20% and reduced paper submission claims by 70% by using ZirMed solutions.
The reasons claims are denied are so varied that managing denials can feel like chasing a thousand different tails. This situation is not surprising given that a hypothetical denial rate of just 5 percent translates to tens of thousands of denied claims per year for large hospitals—where real‐world denial rates often range from 12 to 22 percent. Read about how predictive modeling can detect meaningful correlations across claims denials data.
Emergency Mobile Health Care (EMHC) was founded to be and remains an exclusively locally owned and operated emergency medical service organization; today EMHC serves a population of more than a million people in and around Memphis, answering 75,000 calls each year.
Since the Physician Quality Reporting Initiative (PQRI) introduction, CMS has paid more than $100 million in bonus payments to participants. However, these bonuses ended in 2015; providers who successfully meet the reporting requirements in 2016 will avoid the 2% negative payment adjustment in 2018, so now is the time to act! Included in this whitepaper are implications of increasing patient responsibility, collections best practices, and collections and internal control solutions.
Getting paid what your physician deserves—that’s the goal of every biller. Yet even for the best billers, achieving that success can be elusive when denials stand in the way of success, presenting challenges at every turn. Denials aren’t going away, but you can learn techniques to manage and even prevent them.Join practice management expert Elizabeth W. Woodcock, MBA, FACMPE, CPC, to: Discover methods to translate denial data into business intelligence to improve your bottom line, determine staff productivity benchmarks for billers, and recognize common mistakes in denial management.
Physician practices must improve organizational efficiency to compete in this era of reduced reimbursement and escalating administrative costs.
Many healthcare organizations are pursuing next-generation health information systems solutions. Learn more about Navigant's work with University of Michigan Health System.
The proper implementation of healthcare information technology systems is crucial to an organization’s financial health.
HFMA's print, email, online, and mobile opportunities provide you maximum reach and impact. We will work with you to build a plan that meets your needs. Contact a sales rep.
Stay informed about new directions in healthcare finance. Share tools and strategies for improving performance. Be an active participant in your profession. Together, we’ll reshape the business and practice of healthcare. Join us.
Of all the transformations reshaping American health care, none is more profound than the shift toward value. Access HFMA’s Value Project to discover how healthcare finance leaders are joining this transformation.
Copyright 2016, Healthcare Financial Management Association.
Join HFMA today and enjoy: