Given tightening payment, shifts in coverage, and the coming transition to ICD-10, hospitals need to ensure they build safeguards into current workflows to optimize revenue capture and reduce the risk of non-payment or delayed payment. In Five Steps to Capturing More Revenue for Your Hospital, Emdeon (now known as Change Healthcare) discusses several sources of payment risk and strategies for safeguarding payment.

HFMA is committed to advancing the financial management of health care by providing resources to members and others in hopes of improving the business performance of organizations operating in or serving the healthcare field. With this in mind, HFMA brings you the following highlight of key issues discussed.

Issues at a Glance

Several key payment issues put hospitals at particular risk for revenue loss. 

  • Denials management will be challenged as coding complexity will increase under ICD-10 and bring greater potential for denials and costly rejections.
  • Contracting is becoming more sophisticated, requiring hospital vigilance to the terms agreed to by commercial and government payers.
  • Uncompensated care and the continued shift to increased patient financial responsibility mean strong eligibility and patient financial assistance policies will be imperative for hospitals to support consumer satisfaction and protect financial performance.

What Does This Mean for Hospital Leaders?

Safeguarding payment will depend on multiple actions from hospital leaders.

Assist in converting the uninsured to a payer source. Reducing the number of self-pay patients also reduces non-payment risk. As such, many organizations are focusing on giving patients access to healthcare brokers, certified application counselors, and patient navigators to help patients enroll in plans available on the health exchange or through Medicare and Medicaid.

Facilitate a smoother patient payment process. As patients’ financial responsibility increases, healthcare providers are recognizing the increased importance of communicating balances owed in a clear, correct, and concise manner. According to a recent focus group conducted by Emdeon (now known as Change Healthcare), patient statements can have a notable impact on how a patient perceives the quality of interaction with his or her provider, satisfaction with the care experience, and time to payment. Simply reconfiguring patient statements to have a simple summary cover page and subsequent detailed pages that clearly communicate amount owed, due date, and options for payment can reduce inbound call volume, improve perception of the care experience, and reduce days outstanding.

Also important is offering payment options, such as online and pay-by-phone options. In addition, price transparency prior to scheduled services will support consumer engagement and provide an opportunity for pre-service collection.

Institute systems to support revenue integrity. Retrospective and ongoing concurrent reviews of contractual denials and underpayments as well as recovery of zero-balance third-party accounts make it more likely that the organization will get paid the right amount.

Address denials and rejections proactively. Determining benefit eligibility and obtaining proper documentation are key to submitting claims properly on the first pass. Also, analytical tools are important to proactively identify opportunities to increase cash flow and stem revenue leakage. By identifying areas of concern and conducting root-cause analysis, providers can then alter processes to reduce future risk of audit and/or non-payment.

Go paperless. By enrolling in electronic payment services, hospitals and payers are able to communicate and submit payment information electronically—a process that can reduce days outstanding.

Read the full white paper, "Five Steps to Capturing More Revenue for Your Hospital."

Emdeon (now known as Change Healthcare) is a leading provider of revenue and payment cycle solutions, connecting payers, providers, and patients in the U.S. healthcare system. Our product and service offerings integrate and automate key business and administrative functions of our payer and provider customers throughout the patient encounter. Through the use of our comprehensive suite of products and services, which are designed to easily integrate with existing technology infrastructures, our customers are able to improve efficiency, reduce costs, increase cash flow, and more efficiently manage the complex revenue and payment cycle process.

HFMA does not endorse the material summarized above or warrant or guarantee its accuracy. Opinions expressed within the material or references to commercial manufacturers, vendors, products, or services that appear within do not constitute endorsements by HFMA.

Publication Date: Thursday, January 01, 2015