My organization recently transitioned to its first Ambulatory Payment Classifications (APC)/DRG-based contract with a commercial plan. We are struggling with determining how to monitor the contract’s performance and, in particular, with the primary focus on the APC payment. Are there recommended key performance indicators (KPIs) used to track this performance?
Answer: It is likely that your organization would benefit from the use of payment analysis software and from running all of the actual billing and payment details for each individual case through the software’s program. Before beginning the use of such software, however, it is essential to have a payment contract specialist correctly enter the contract details into the software’s program. The one-time cost for having a professional outside of your organization do this is well worth the expense because that person does this task frequently for many providers, rather than one of your organization’s staff who does this only once or twice a year, and only for your organization.
If used correctly, the software program is likely to identify incorrect payments that are not in accordance with the contract and also find some “grey areas” of the contract that require further discussion with the commercial plan.
This question was answered by: Robert J. Ellertsen, FHFMA, a former hospital CFO with more than 35 years of experience in healthcare finance, and a member of HFMA’s Massachusetts-Rhode Island Chapter.