Souza, M. & McCarty, B. (2007). From bottom to top: How one provider retooled its collections → ESSAY WRITERS

Souza, M. & McCarty, B. (2007). From bottom to top: How one provider retooled its collections [Electronic version]. Healthcare Financial Management, 61(9), 67-73.

Need Help Writing Your Essay?

Tell us about your assignment and we will find the best writer for your paper.

Get Help Now!

Include the following:

· Complete a summary of the case study that identifies the key problems and issues, provides background information, relevant facts, the solution employed, and the results achieved.

· Identify and explain the accounting practices California Sutter Health used in defining and solving its collection problems.

· Develop an alternative solution based on your own research using three to five academic sources from journals, professional organizations, and websites.

· State your informed opinion of the approach used by California Sutter Health, and provide support using concepts from your research and personal experience.

Writing the Final Paper

The Final Paper Instruction:

Must be eight double-spaced pages in length, not including the title page and reference page, and formatted according to APA style.
Must begin with an introductory paragraph that has a succinct thesis statement.
Must address the topic of the paper with critical thought.
Must use a visual such as a chart, table, graph, or other that relates to something you have learned in the class and is relevant to the case. Here’s the book we use for the class: Epstein, L. & Schneider, A. (2014). Accounting for Health Care Professionals [Electronic version]. Retrieved from https://content.ashford.edu/
Must end with a conclusion that reaffirms your thesis.
Must use at least three scholarly sources.

Due 10/18/19 @10am Eastern with turnitin report. I will check accuracy of plagiarism report and I will ensure you completed the paper in its entirety by following each bulletin and reading the case study I personally attached.

Margie Souza Brent McCarty

COVER STORY

from bottom to top how one provider retooled its collections How should a hospital go about increasing its upfront collections from self-pay patients? California’s Sutter Health has found an effective way to accomplish this goal. We all know the mantra, “no margin, no mission.” One increasingly important strategy for optimiz- ing margins in this time of high-deductible health plans and higher copayments is to collect more cash from patients. Including self-pay patients.

Much has been made of the fact that nearly 4,7 million Americans are uninsured, but it’s an erroneous assumption that none of these people can afford to pay for their health care. More than 80 percent of uninsured people come from work- ing families, and many may have the resources to pay for some or all of their health care—if only someone would ask them to.

Thai “someone” is the patient financial services (PFS) staff member. To frame the question in a way that will elicit the most positive response, PFS staff need complete, accurate, and timely

information and the appropriate skills—and the confidence to use them. These needs apply especially to registration staff because the best time to collect payment for services is before those services are provided.

Registration staff, however, typically are unaccus- tomed to asking for money. It is therefore impor- tant that the transfer of this responsibility from the back end—the central business office and collectors—to these front-end staff be managed thoughtfully and in a well-organized manner that takes into account the needs of all PFS staff.

The Sutier Health Approach Sutter Health, one of Northern California’s largest providers, is committed to giving its PFS staff on both the front and back ends the tools they need to improve patient collections and thus the system’s bottom line. Having started in 2006 with the patient account representatives, collec- tors, and other members ofthe central business office of its Sacramento/Sierra region, the health system is working its way forward to the registra- tion staff, ultimately aiming to transfer many of the back-end functions to the front end and make point-of-service collection the norm.

In the first three months ofthe project, Sutter reduced accounts receivable (A/R days) for the nine hospitals in the region from 65 to 59. Given that each one of those days equals $i3 million,

AT A GLANCE

In its effort to increase point-of-service collec- tions and improve the overall revenue cycle, Sutter Health took steps to: > Measure performance

using a handful of specific, primary benchmarks

Empower PFS siafi to assume responsibility for every individual account they handle
Ensure each registra- tion is analyzed using a rules engine to identify problems before patients leave the registration desk
Ensure PFS staff receive appropriate comprehensive training to excel under the new system

M m SEPTEMBER 2007 67

COVER STORY

This aged trial balance analysis, which shows aging and status of a patient representative’s personal assigned stew- ardship, is intended to assist the representative in his or her perform- ance-improvement efforts.

that means the health system collected an addi- tional $78 million.

Setting Benchmarks . ! In analyzing its revenue management cycle prior to implementing the new program. Sutter identi- fied several problems.

First, PFS staff could not access real-time infor- mation on key financial and operational indica- tors such as A/R days and cash collections. As a result, managers and staff often had to wait until the end of the month to set henchmarks, track progress, or make important business decisions.

Second, the hospitals’ accounting system did not allow managers to isolate and analyze select data or generate reports on demand to the level of detail required. Instead, the region relied on a specially trained programmer to develop these reports, often leading to costly delays in identify- ing and correcting problems.

Third, the central business office (CBO) stalf also suffered from the lack of real-time information, ^lth access to only a list of the outstanding accounts assigned to them, account representatives could not prioritize effectively or monitor their progress.

In turning this situation around. Sutter decided to focus on a handful of primary benchmarks: > Gross A/R days (less capitation and credit bal –

ance accounts) > Cash collections >UnhiUed A/R days > Billed A/R days > Percentage of A/R over 90.180. and 36o days > Majorpayer A/R days

Empowering PFS Staff Sutter s strategy for increasing collections and reducing A/R days focused on empowering indi- vidual PFS staff members to assume responsibil- ity for each account they deal with. In effect, each person in the CBO owns his or her own business,

ATB Analysis ($ in millions)

SAMPLE AGED TRIAL BALANCE ANALYSIS

Inhouse Not Disch OP

DNFBNoDiag DNFB Other

0-30 31-60 61-90

91-120 121-150 151-180 181-210 211-240 241-270 271-300 301-330 331-365

366 CRBAL

Above is a graphical representation of your current receivables stewardship. We would hope to see the following trend in the bars: The longest bar would be the 0-30 day bar. From there we would hope to see a steep Mount Everest drop-off to nothing as quickly as possible. Every bar after that should be no greater than hall the size of the one above it. You have five aging categories that do not follow the ideal pattern: 121-150,271-300,301-330,331-365, and 366+.

68 SEPTEMBER 2007 healthcare financial management

(omplete with a customized dasliboard to track progress in meeting individual and team targets.

To help PFS staff manage their businesses effec- tively. Sutter has provided them with a set of tools that allows them to: > Prioritize and automate account work lists > Sort accounts in various ways, such as by dollar

amounts, oldest previous work date, and payer * See at a glance their ranking within their work

group and officewide, based on their perform- ance as a percentage of the target achieved

The tools tell staff members not only how they are doing, but also where and how they could improve, pointing out which accounts, if worked successfully, will have the greatest impact on iheir A/R days and cash collection goals.

Managers have their own receivables dashboard and tools, enabling them to: ^ Query all aspects of receivables for trending purposes and identify problem areas

Drill down to the patient account level > Monitor revenue, payments, adjustments,

receivables, and days for periods from the pre- vious day and week to the previous 18 months

Calculate average daily revenue by day and 3o-day period

^ Assess their performance for the month to date, and estimate likely results at the month end

View all receivables or select any segment for quick analysis
Generate timely reports on demand, including aging analysis. A/R stratification, discharged not final billed (DNFB) analysis, credit balance analysis, and analysis of problem payers

A denials management component was imple- mented in late summer. When registration staff go online at the end of the year, the cycle will be complete, with all parts having access to all the ilata they need to produce clean claims.

Front-End Collecting Half of the required billing elements on a UB- 92/04 originate at the point of access. As a result, this point in the revenue cycle presents tbe great- est opportunity to reduce claims denials. To help ensure optimum performance at this crucial juncture. Sutter’s new process requires that each registration be analyzed by a rules engine before the patient leaves the registration desk to identify potential problems.

Examples of problems or errors that can be iden- tified at this stage include the following: > Workers” compensation or liahility financial

class lacks accident information. > Workers’ compensation is filed with an occur-

rence code otber than 04. > The patient’s guarantor is under 18 years old. > The patient’s marital status is widowed, but the

relative is listed as husband, wife, or spouse. > The patient type is not valid for hospital service, > Tbe patient is age 65 or older, but the Medicare

insurance plan is missing. > The patient had Medicare in any plan code, but

the Medicare secondary payer questionnaire is missing.

Tbe health insurance claimnumber or policy ID number is missing.
The patient address includes errors in format, punctuation, and/or abbreviations.
Tbe patient bas duplicate medical record numbers.

This front – end claims editing enables PFS staff to quickly identify problem areas where corrective action and/or further training is needed.

In the same way. computer interfaces allow the system to flag accounts tbat require special han- dling. The admitting clerk receives an alert that may include a description of specific action he or she should take. Examples of such alerts include “Patient has other accounts with returned mail;

ABOUT SUTTER HEALTH

Sutter Health is a leading not-for-profit network of community-based healthcare providers that deliver care in more than 100 Northern California communities. The net- work consists of more than two dozen acute care hospitals, as well as physician organizations, medical research facili- ties, home health serv- ices, hospice and occupational health net- works, and long-term care centers.

M m SEPTEMBER 2007 6 9

OVER STORY

please check for valid address.” and “Patient has other accounts in bad debt: please request payment.’*

Experience has shown tbat a simple prompt to tbe registrar to collect the amount preregistration has established with the patient can make all tbe difference. Sutter will be testing a tool to track how much money each staff person collects up front, hoping eventually to link that tool to esti- mating and contract management systems so that

registrars can be evaluated as well on percentages of contracted rates and established targets collected.

Comprehensive Training Sutter’s system is designed to support the exist- ing PFS and registration staff without the need to hire a more formally educated staff or to increase wages beyond the current average of $10 to $20 an hour. The system does, however, require that staff receive comprehensive training.

SAMPLE EXECUTIVE ANALYSIS

Stop Stressing. Your Academic Success is Guaranteed.