Hammer Map Kpis Hfma NJ 11 Jan 2011

HFMA-NJs PFS Quarterly Meeting Woodbridge Hilton 11 January 2011
Key Performance Indicators (KPIs): Strategies for a High-Performance Revenue Cycle

David Hammer Partner Accenture Health & Public Services Practice Fort Lauderdale, FL
Content and Organization

Introduction Key Performance Indicators HFMAs MAP Initiative Organization and Management HFMA MAP MAP Initiative MAP Award Key Performance Indicators Performance Measurement Concepts KPI Hierarchy Level I, II, III, and IV KPIs
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Content and Organization (contd)

Metric-Driven Revenue Cycle Appendix 1: MAP Keys 19 Definitions Appendix 2: KPIs by Functional Area Best Practice Performance Standards Best Practice Processes Call to Action
Even the VERY BEST Keep Score!
In business, words are words, explanations are explanations, promises are promises, but only performance is reality.
Harold S. Geneen
Former President and CEO of ITT
Even the VERY BEST Keep Score!
If you cant measure it, you cant manage it.

Michael Bloomberg
Mayor of New York City and CEO of Bloomberg, Inc.
Wheres Your Focus?
KPI Introduction
What is a Key Performance Indicator? Numerical factor Used to quantitatively measure performance 9 Activities, volumes, etc. 9 Business processes 9 Financial assets 9 Functional groups 9 The entire revenue cycle
SOURCE: BearingPoint, Key Performance Indicators
KPI Introduction
Purposes of KPIs View a snapshot of performance at an individual, group, department, hospital, or regional level Assess the current situation and determine root causes of identified problem areas Set goals, expectations, and financial incentives for any individual or group Trend the performance of the selected individual or group over time
SOURCE: BearingPoint, Key Performance Indicators
HFMAs PATIENT FRIENDLY BILLING Project

The KPI Connection
HFMAs PATIENT FRIENDLY BILLING Project Standards of Excellence: Goal
To identify revenue cycle characteristics or processes with the most impact on value to consumers and hospitals
HFMAs PATIENT FRIENDLY BILLING Project Standards of Excellence: Findings Must Haves
Organizational culture that elevates the importance of the revenue cycle Be good at what you need to be good at Accelerate improvements take action and execute
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A pictures worth a thousand words
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Organization and Management

Structure and Function
REVENUE CYCLE CONTROL POINTS
Customer Service
Patient Access
Scheduling Pre-Reg Registration Verification
Revenue Integrity
Charge capture Coding CDM Contracting
Billing
Unbilled control Electronic and manual billing Secondary billing
Follow-up
Largebalance Smallbalance 3rd-party Self-pay
Cash Control
Collection Posting Payment analysis Denials management
Bad Debt
Pre-listing Account placement Agency tracking
KPIs Reporting
ATBs Productivity Unbilled Claim submission Denials reasons
Information Technology
SOURCE: KPMG
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MEDICAL RECORD & CODING
CHARGE CAPTURE & ENTRY REGISTRATION & POS CASH COLLECTIONS
MEDICAL MANAGEMENT
CLAIMS & INVOICE PROCESSING
FIRST & THIRD-PARTY FOLLOW-UP
CLINICAL CARE
REMITTANCE & DENIAL MANAGEMENT
PRE-REG & PRE-CERT (Authorization) CONTRACT MANAGEMENT PATIENT & INSURANCE SCHEDULING VERIFICATION PATIENT SURGICAL, SUPPLY
(RESOURCE, )
REQUEST FOR SERVICE FINANCIAL SERVICES MATERIALS MANAGEMENT
DATA ANALYSIS & REPORTING
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6 CHARGE CAPTURE & ENTRY 5 FINANCIAL COUNS 7 MEDICAL MGT
8 MEDICAL RECORDS & CODING
9 CLAIM SUBMIT 10 PARTY FOLLOW-UP 3RD
4 REG + POS COLLECTIONS
PATIENT
Patient
11 PMT + ADJ POSTING
3 INS VERF 2 PRE-REG & PRE-CERT 13 DENIAL & APPEAL MGT
12 DENIAL PROCESSING 1 SCHEDULING 14 Revenue CONTRACT ADMIN
SOURCE: PriceWaterhouse Coopers
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COMPLIANCE
O.I.G & Other Regulators
5 REGISTRATION & POS CASH COLLECTIONS
HEALTHCARE REFORM
Financial Institutions
7 6 CHARGE CAPTURE & ENTRY MEDICAL MANAGEMENT
COST CONTAINMENT
Medicare & Medicaid FIs
10 THIRD PARTY FOLLOW-UP
8 MEDICAL RECORDS & CODING
9 CLAIMS SUBMISSION
RACs & MICs
FINANCIAL COUNSELING
PATIENT
11 PAYMENT POSTING
Capital Markets
3 INSURANCE VERIFICATION 2 PRE-REG & PRE-CERT 13 DENIAL & APPEAL MANAGEMENT
12 REJECTION PROCESSING
1 SCHEDULING
Affiliated & Employed MDs
Revenue
14 CONTRACT NEGOTIATION / ADMIN.
HMOs / PPOs
CONSOLIDATION / STANDARDIZATION
Employers
CASH FLOW
QUALITY-DRIVEN REIMBURSEMENT
SOURCE: PriceWaterhouse Coopers
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What is HFMAs MAP initiative?
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HFMAs MAP Initiative

Revenue Cycle Excellence
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What is MAP?
MAP is a comprehensive performance-improvement strategy

Identify indicators Track and improve performance Recognize excellence Share successful practices
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What are MAP Keys?
MAP Keys are provider-developed revenue cycle key performance indicators

Clearly-defined Measurable Discerning Comparable
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MAP Keys
MAP Keys focus on key areas of revenue cycle performance

Patient Access Revenue Integrity Claims Adjudication Management
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MAP Keys
Purpose | Value | Calculation

Indicator Purpose Value Calculation
Example Net days in A/R

Trending indicator of overall A/R performance Indicates revenue cycle efficiency Net A/R Net patient-service revenue
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MAP Keys
Comparing Performance
Manage trends Identify opportunities Prioritize opportunities Indentify successful practices
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MAP Keys
Comparing Performance: Flexible comparisons for in-depth analysis

5%
Industry trends Performance over multiple time frames Pre-selected peer groups Customized peer groups
4%
3%
1%
0% Jan 09 Mar 09 May 09 Jul 09 Sep 09 Nov 09
Bad Debt vs Charity Care as % of Revenue

Source: HFMAs
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What is HFMAs MAP Award?
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HFMAs MAP Award

Revenue Cycle Excellence
HFMAs MAP Award recognizes healthcare organizations that achieve revenue cycle excellence and serve as models for the healthcare industry
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HFMAs MAP Award

MAP Application Data Approach
The MAP application evaluates HFMAs financial-performance MAP Keys, as well as PATIENT FRIENDLY BILLING Project criteria
HFMAs MAP Keys (KPIs) are the primary metrics used in the application Best practices identified in 2009s PFB research are incorporated in the MAP Award application Additional criteria to evaluate patient satisfaction are also included
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HFMAs MAP Award

Sample Insights from High-Performance Organizations
Improvement Opportunity: POS Collections

Point-of-Service Collections Research
9 Top-25 quartile: 35% 9 Top-10 decile: 46% 9 % of high performers that cite importance of investing in upstream technologies 9 % of high performers offering price estimates to patients at registration
Source: HFMAs 2010 MAP Award Data POS Collections Comparable Statistics
27% 43.6% Median Top-Quartile Performance
Successful practices
9 Use of sample scripts 9 Use of dedicated Patient Access trainers
Source: HFMAs
March 2010
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HFMAs MAP Award

Summary of 2010 Results
KPI METRIC
Net Days in A/R POS Cash Collections Cash Collections as a Percentage of Adjusted Net Patient-Service Revenue Total Bad Debt Write-off Percentage Days in DNFB Patient Satisfaction Score
OVERALL TOP 25th TOP 10th RANGE PERCENTILE PERCENTILE

58.9 23.2 0.0% 66.0% 100.0% 117.8% 37.4 35.0% 101.8% 32.8 46.3% 104.4%
9.47% 0.29% 13.50 0.13 51 95%
1.30% 6.3 78%
0.90% 2.7 82%
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HFMAs MAP Award

MAP Keys Selected for 2011 1. Net Days in Accounts Receivable 2. Over-90 Aged A/R as a Percentage of Billed A/R 3. Point-of-Service (POS) Cash Collections 4. Cash Collections as a Percentage of Adjusted Net Patient-Service Revenue
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HFMAs MAP Award

MAP Keys Selected for 2011 5. Total Bad Debt Write-Off Percentage 6. Total Charity Care Write-Off Percentage 7. Days in Total Discharge-Not-Final-Billed (DNFB) 8. Days in Total Final-Billed-Not-Submitted-to-Payer (FBNS)
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How should you measure performance?
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Key Performance Indicators

Performance Measurement Concepts Why Use KPIs? Keep a record and tell a story Benchmark against your goals and industry best practices Identify and manage trends, not single-period results Illustrate relationships between KPIs
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Performance Measurement Concepts Use external, verifiable info sources Share the same data with everyone
9 Board 9 Senior management 9 Peers 9 Subordinates
Report both good and bad results
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Performance Measurement Concepts Emphasize relative, not absolute KPIs Enable non-manual data extraction Remember, measures drive goal achievement Minimize budget goal approach Embrace stretch goal approach Link incentive comp to stretch goals
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Not all KPIs are created equal
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KPI Hierarchy Level I: Board members, senior execs, financial and clinical directors, and internal reporting for all revenue cycle managers, supervisors, and employees Level II: CFO, finance directors and employees, and internal reporting for all revenue cycle managers, supervisors, and employees
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KPI Hierarchy Level III: CFO plus internal reporting for all revenue cycle managers, supervisors, and employees Level IV: Internal comparisons of different payors plus external reporting for third party payors
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KPI Hierarchy First-Level Indicators Cash collections Gross and net A/R In-House and D-N-F-B receivables 3rd-party aging % > 90 days Cash % of net revenue Cost to collect %
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Cash Collections First Level
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Cash Collections First Level
KPI DAYS $
GOAL 20 $20M
M-T-D 10 $11M
% 50% 55%
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Gross A/R First Level
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Net A/R First Level
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In-House and D-N-F-B A/R First Level
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3rd-Party Aging % > 90 Days First Level
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Cash % of Net Revenue First Level
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Cost-to-Collect % First Level
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KPI Hierarchy Second-Level Indicators Net A/R days Allowance for doubtful accounts Bad debt + charity % of gross revenue Denials % of gross revenue Cash % of collection goal Point-of-service cash % of POS goal
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Net A/R Days Second Level
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Allowance for Doubtful Accts Second Level
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B/D + Charity % of Gross Rev Second Level
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Denials % of Gross Revenue Second Level
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A/R Cash % of Cash Goal Second Level
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P-O-S Cash % of Goal Second Level
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KPI Hierarchy Third-Level Indicators Credit balance receivables Clean claims throughput % Collection agency netback % Net revenue Case mix index (CMI) Complaints to Administration Open accounts
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Credit-Balance Receivables Third Level
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Clean-Claim Throughput % Third Level
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Collection Agency Netback % Third Level
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Net Revenue Third Level
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Case Mix Index (CMI) Third Level
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Complaints to Administration Third Level
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Open Accounts Third Level
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Managed Care Report Cards Fourth Level Revenue Cycle KPI reporting sample for: 9 Board of Directors 9 Finance Committee 9 Finance Division 9 Internal reporting System-wide reporting example MS Access database Managed Care Report Cards (letters, actually)
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Managed Care Report Cards Fourth Level By Major Payor Category or Plan Code % of Total A/R >60 Days % of A/R >35 Days (No Pmt, No Response) % of A/R in Underpaid Category % of A/R in Appeal Status % of A/R in Overpaid Category
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Managed Care Report Cards Fourth Level
MEASUREMENT Total A/R by month % A/R >60 days % A/R >35 days %/$ Underpaid %/$ Denials under appeal %/$ Overpaid
PEER COMPARISONS SHOW Overall A/R trend & direction Claims processing issues Promptness of payment Contract interpretation issues Denial issues Contract interpretation issues
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So You think you want a metric-driven revenue cycle?
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Planning and Implementing Key Thoughts How do you start? 9Open the discussion 9Take time to define / refine KPIs 9Gain consensus and commitment How do you use KPIs to enact change? 9Understand processes that generate KPIs 9Create a culture of accountability and reward 9Continuously adapt and iterate
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Planning and Implementing Key Thoughts Take the complexity out; simplify your work View key indicators that provide early warnings Maintain personal involvement in critical areas Access a mix of early-warning and historical data
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Planning and Implementing Key Questions Consider the following questions 9 How do we enter data? 9 How do we get reports? 9 How do we use information to effect change? 9 When / why are things out-of-control? 9 What do we do?
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Planning and Implementing Call to Action! Open / frame the discussion Define / refine KPIs Gain consensus / commitment Demand accountability / reward results Continuously adapt and iterate Achieve results! 5% 50% 10% 25% 10% 100%
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Wheres Your Focus?
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Bibliography
1. 2. 3. 15 Questions to Ask Before Signing a Managed Care Contract, Private Sector Advocacy, Dec 2002 BearingPoint, Key Performance Indicators, Catholic Health East, 2003 Canfield, David and Scott Johnston, HFMA Patient Revenue Cycle Industry Study, Healthcare Financial Management Association, Westchester, IL, 2002 Clinical Quality Guidelines, NEJM, 348:2635-45, June 26, 2003 Guyton, Elizabeth and Chuck Lund, Transforming the Revenue Cycle, Healthcare Financial Management, Mar 2003 Harris, David, Turning Your Revenue Cycle Into a Hot Rod Using BoltOn Technology, HFMA ANI, Jun 2004 LaForge, Richard and Johnny Tureaud, Revenue-Cycle Redesign: Honing the Details, Healthcare Financial Management, Jan 2003 Managed Care Forum Contracting Checklist, HFMA Wants You to Know, 21 Apr 2004
4. 5. 6. 7. 8.
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Bibliography
9. 10. 11. 12. 13. 14. 15. Miller, Thomas, Conducting a Managed Care Contract Review, Healthcare Financial Management, Jan 1998 Pogue, Neil CMS Program Office, Medicare Policy Update, HFMAs Revenue Cycle Strategies Conference, San Francisco, 09 Oct 2007 Schneider, Robert, Sheldon Mandelbaum, Ken Braboys, and Cynthia Bailey, Process-Centered Revenue Cycle Management Optimizes Payment Process, Healthcare Financial Management, Jan 2001 Stevenson, Paul, Managed Care Cycle Provides Contract Oversight, Healthcare Financial Management, Mar 2002 Walters, Roy, Five Steps to Great Revenue Cycle Management, Healthcare Financial Management, May 2002 Wennberg, John, E. Fisher, T. Stukel and S. Sharp, Use of Medicare Claims Data to Monitor Provider-Specific Performance Among Patients with Severe Chronic Illness, Journal of Health Affairs, 07 Oct 2004 Wilson, David, 3 Steps to Profitable Managed Care Contracts, Healthcare Financial Management, May 2004
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Instructors Bio
David Hammer, Partner, Accenture
Mr. Hammer is a Senior Executive (Partner) in Accenture's Health and Public Services Practice, specializing in revenue cycle management and health reform. He serves many of the largest health systems, MD-led clinics, and academic medical centers in the US. Prior to joining Accenture, David was VP of enterprise revenue management at McKesson, the nation's largest healthcare IT firm, and was previously the chief revenue officer for Charter Behavioral Health, a +100-facility health system. David has over 28 years of professional experience in healthcare, including executive leadership and direction, revenue cycle transformation, information system planning / implementation, and consulting. He has worked for a variety of leading health systems, software vendors, and professional services firms.
Background and Affiliations

Mr. Hammer received an MBA in Management and an MHS in Health Care Administration from the University of Florida. He also received a BBA in Accounting with a minor in Information Systems (Magna cum Laude) from the University of North Florida. Mr. Hammer is certified by HFMA as a Fellow (FHFMA) and as a Certified Healthcare Finance Professional (CHFP). He has been named an HFMA Distinguished Speaker for seven consecutive years, and is a 2007 recipient of HFMAs Medal of Honor service award.
Recent Publications
Mr. Hammers most recent publication is Health Reform: Intended and Unintended Consequences, which appeared in the October 2010 issue of HFMAs healthcare financial management journal (hfm). Dont Panic: CFOs React to the New Economic Reality, appeared in hfms March 2009 issue. Mr. Hammer authored the February 2008 cover story in hfm, entitled Beyond Bolt-Ons Breakthroughs in Revenue Cycle Information Systems. He also wrote the July 2007 cover story, called The Next Generation of Revenue Cycle Management, as well as the July 2005 hfm cover story, entitled Performance is Reality: Is Your Revenue Cycle Holding Up? Another one of his articles, UPMCs Metric-Driven Revenue Cycle, appeared in the September 2007 issue of hfm, and Data and Dollars: How CDHC is Driving the Convergence of Banking and Health Care was published in hfms February 2007 issue. His article Black Space Versus White Space The New Revenue Cycle Battleground appeared in the January 2007 issue, and Customer Service Adapts to CDHC appeared in the September 2006 issue.
Contact Information
Mr. Hammer can be reached by telephone at (954) 648-4764 and/or by e-mail at david.c.hammer@accenture.com or at david.c.hammer@gmail.com
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Appendices MAP Key Definitions and Detailed KPIs
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Definitions of HFMAs MAP Keys
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MAP Keys: Net Days in A/R

Indicator Purpose Value Calculation Net days in A/R Trending indicator of overall A/R performance Indicates revenue cycle efficiency Net A/R Average Daily Net Patient Service Revenue
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MAP Keys: Aged A/R Percentage of Final-Billed A/R

Indicator Purpose Value Calculation Aged A/R as a percentage of Billed A/R Trending indicator of receivables collectability Indicates RCs ability to liquidate A/R >30,>60,>90,>120 days Total Billed A/R
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MAP Keys: Point-of-Service Cash Collections ($)

Indicator Purpose Value Point-of-Service Cash Collections Trending indicator of point-of-service collection efforts Indicates potential exposure to bad debt, accelerates cash collections, and can reduce collection costs POS Payments Total Patient Cash Collected
Calculation
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MAP Keys: Cost to Collect

Indicator Purpose Value Calculation Cost to Collect Trending indicator of operational performance Indicates the efficiency and productivity of RC process Total RC Cost Total Cash Collected
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MAP Keys: Cash Percentage of Net Revenue

Indicator Purpose Value Calculation Cash Collections as a Percentage of Adjusted Net Patient-Service Revenue Trending indicator of propensity to convert net revenue to cash Indicates fiscal integrity / financial health of the organization Total Cash Collected Average Monthly Net Revenue
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MAP Keys: Bad Debt (%)

Indicator Purpose Bad Debt Trending indicator of the effectiveness of self-pay collection efforts and financial counseling Indicates organizations ability to collect self-pay accounts and identify payor sources for patients unable to meet financial obligations Bad Debt Write-Off Gross Patient Service Revenue 85
Value
Calculation

MAP Keys: Charity Care (%)

Indicator Purpose Charity Care Trending indicator of local ability to pay Indicates organizations ability to collect self-pay accounts and identify payor sources for patients unable to meet financial obligations Charity Care Write-Off Gross Patient Service Revenue 86
Value
Calculation

MAP Keys: Days in Total DNFB

Indicator Purpose Value Days in Total Discharged Not Final Billed Trending indicator of local ability to pay Indicates RC performance and can identify performance issues impacting cash flow Gross Dollars in DNFB A/R Average Daily Gross Revenue
Calculation
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MAP Keys: Aged A/R Percentage of Billed A/R by Payor

Indicator Purpose Value Aged A/R as a % of Billed A/R, by Payor Group Trending indicator of receivables collectability, by payor group Indicates RCs ability to liquidate A/R, by specific payor group Billed Payor Group by Aging (>30,>60,>90,>120 days) Total Billed A/R by payor group
Calculation
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MAP Keys: Days in FBNS

Indicator Purpose Days in Final Billed Not Submitted to Payor (FBNS) Trending indicator of claims delayed by payor / regulatory edits in the claims processing system Track the impact of internal / external requirements for clean claim production, which impact cash flow Gross Dollars in FBNS Average Daily Gross Revenue 89
Value
Calculation

MAP Keys: Days in DNSP (DNFB + FBNS)

Indicator Purpose Value Days in Total Discharged Not Submitted to Payer (DNSP) Trending indicator of total claimsgeneration / submission effectiveness Indicates revenue cycle performance and can identify performance issues impacting cash flow Gross $ in DNFB + Gross $ in FBNS Average Daily Gross Revenue
Calculation
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MAP Keys: Late Charge Percentage

Indicator Purpose Value Late Charges as % of Total Charges Measure of revenue-integrity effectiveness Identify opportunities to improve revenue integrity, reduce avoidable costs, enhance compliance, and accelerate cash flow Charges with posting dates greater than 3 days from final service date Total gross charges 91
Calculation

MAP Keys: Initial Zero-Pay Denial Rate (#)

Indicator Purpose Value Initial Denial Rate Zero-Pay Claims Trending indicator of percentage of claims not paid Indicates providers ability to comply with payor requirements and payors ability to accurately pay claims Number of zero-pay claims denied Number of total claims remitted
Calculation
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MAP Keys: Initial Partial-Pay Denial Rate (#)

Indicator Purpose Value Initial Denial Rate Partial-Pay Claims Trending indicator of percentage of claims partially paid (underpaid) Indicates providers ability to comply with payor requirements and payors ability to accurately pay claims Number of partial-pay claims denied Number of total claims remitted
Calculation
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MAP Keys: Appeals Success Rate (#)

Indicator Purpose Denials Overturned on Appeal Trending indicator of providers success in managing the appeal process Indicates opportunities for payor and provider process improvement and cash-flow improvements Number of appealed claims paid Total number of claims appealed and finalized or closed 94
Value
Calculation

MAP Keys: Net Days in A/R Credits

Indicator Purpose Net Days Revenue in Credit Balances Trending indicator to accurately report A/R values, ensure regulatory compliance, and monitor overall A/R management effectiveness Indicates whether credit balances are managed to appropriate levels and are compliant w/ regulatory requirements Dollars in Credit Balances Average Daily Net Patient-Service Revenue 95
Value
Calculation

MAP Keys: Pre-Registration Rate

Indicator Purpose Pre-Registration Rate Trending indicator of timeliness, accuracy, and efficiency of patient access processes Indicates revenue cycle efficiency and effectiveness Number of patient encounters pre-registered Number of scheduled patient encounters 96
Value Calculation

MAP Keys: Insurance Verification Rate

Indicator Purpose Insurance Verification Rate Trending indicator of timeliness, accuracy, and efficiency of patient access processes Indicates revenue cycle process efficiency and effectiveness Total number of verified encounters Total number of registered encounters
Value Calculation
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MAP Keys: Service-Authorization Rate

Indicator Purpose Service-Authorization Rate Trending indicator of timeliness, accuracy, and efficiency of patient access processes Indicates revenue cycle process efficiency and effectiveness Number of encounters authorized Number of encounters requiring authorization 98
Value Calculation
Lets get down to details
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KPIs by Functional Area

Scheduling Pre-Registration / Pre-Authorization Insurance Verification Patient Access / Registration Financial Counseling Health Information Management Charge Entry / Revenue Protection
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Billing / Claim Submission 3rd-Party and Guarantor Follow-Up Cashiering / Refunds / Adj Posting Denials Customer Service Collection / Outsourcing Vendors Physician Practice Management Managed Care Contracting
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Scheduling
KPI Description
1. Overall scheduling rate of potentially-eligible patients:
Scheduling rate for elective and urgent inpatients Scheduling rate for ambulatory surgery patients Scheduling rate for hi-$ outpatient diagnostic patients
Standard
100% 100% 100% 100% 98%
2. Scheduled patients pre-registration rate
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Scheduling
KPI Description
1. Use on-line scheduling software house-wide? 2. Have central scheduling unit? 3. Central scheduling answers to Chief Revenue Officer? 4. Surgery uses same scheduling software as other depts? 5. Scheduling system integrated with registration system? 6. Use on-line OP medical necessity system prior to service? 7. Pre-certification requirements shared with MDs offices?
Process
Yes Yes Yes Yes Yes Yes Yes
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Scheduling
KPI Description
8. MDs and patients able to make on-line appt requests? 9. Non-emergency services scheduled 12+ hours in advance? 10. Process and IT integrated between scheduling and pre-reg? 11. Services postponed if not pre-authorized in advance? 12. Financial counseling part of scheduling process?
Patient balances and payment obligations discussed? Hospital policy for point-of-service payment explained? Reminder to bring required payment & insurance cards given?
Process
Yes Yes Yes Yes Yes Yes Yes Yes
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Pre-Registration / Pre-Authorization
KPI Description
1. Overall pre-registration rate of scheduled patients 2. Overall insurance verification rate of pre-registered patients 3. Deposit request rate for co-pays and deductibles 4. Deposit request rate for elective admissions / procedures 5. Deposit request rate for prior unpaid balances 6. Data quality compared to pre-established dept standards
Standard
98% 98% 98% 100% 98% 99%
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Pre-Registration / Pre-Authorization
KPI Description
1. Have dedicated pre-registration / pre-authorization unit? 2. Process and IT integrated between scheduling and pre-reg? 3. Services postponed if not pre-authorized in advance? 4. Financial counseling part of pre-reg / pre-auth process?
Patient balances and payment obligations discussed? Hospital policy for point-of-service payment explained? Reminder to bring required payment & insurance cards given?
Process
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Insurance Verification
KPI Description
1. Overall insurance verification rate of scheduled patients 2. Overall ins verification rate of pre-registered patients 3. Ins verf rate of unscheduled IPs w/in one day 4. Ins verf rate of unscheduled hi-$ OPs w/in one day 5. Data quality compared to pre-established dept standards
Standard
98% 98% 98% 98% 99%
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Insurance Verification
KPI Description
1. Have dedicated insurance verification unit? 2. Process and IT integrated between ins verf / patient access? 3. Use on-line insurance verification system? 4. Financial counseling part of insurance verification process?
Alternate arrangements for non-covered patients explored? Hospital policy for point-of-service payment explained? Reminder to bring required payment & insurance cards given?
Process
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Patient Access / Registration
KPI Description
1. Average registration interview duration 2. Average patient wait time 3. Average IP registrations per registrar / per shift 4. Average OP registrations per registrar / per shift 5. Average ER registrations per registrar / per shift 6. Data quality compared to pre-established dept standards 7. ABNs / MSPQs obtained when required 8. MPI duplicates created daily as a % of total registrations
Standard
10 min 10 min 35 40 40 99% 100% 1%
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KPI Description
1. Patient Access reports to Chief Revenue Officer? 2. All registrars report to Patient Access or within rev cycle? 3. Use on-line document imaging system? 4. Financial counseling part of patient access process?
Patient balances and other payment obligations collected? Policy for payment alternatives explained (credit cards, etc.)? Copies of required payment & insurance cards obtained?
Process
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KPI Description
5. Registrars incentive compensation tied to quality indicators? 6. Registration system integrated / interfaced to PFS system? 7. Use on-line / web-enabled patient self-registration system? 8. Use on-line OP medical necessity system prior to service? 9. Use on-line registration data quality tracking system? 10. Have on-line interface to owned MDs registration system?
Process
Yes Yes Yes Yes Yes Yes
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Financial Counseling
KPI Description
1. Collection of elective services deposits prior to service 2. Collection of IP patient-pay balances prior to discharge 3. Collection of OP patient-pay balances prior to service 4. Collection of ER patient-pay balances prior to departure 5. Screening of uninsured IPs and hi-bal OPs for fin assist 6. Pmt arrangements for non-charity eligible IPs / hi-bal OPs 7. Prompt-payment discount percentage(s)
Standard
100% 65% 75% 50% 98% 98% 05 20%
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KPI Description
1. Financial counseling reports to Chief Revenue Officer? 2. Uninsured IPs and high-balance OPs screened for fin assist?
Medicaid eligibility? State, local, and hospital charity programs? Grants / studies, etc.?
Process
3. Financial counselors interview patients in their rooms? 4. Prompt payment discounts offered?
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KPI Description
5. Fin counselors incentive compensation tied to collections? 6. Discuss pmt alternatives w/ non-charity eligible patients?
Credit cards? Bank-loan financing? Interest-bearing hospital-funded payment arrangements?
Process
7. All IPs cleared thru financial counselors before discharge? 8. Proof of income / assets obtained from charity applicants?
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Health Information Management
KPI Description
1. IP charts coded per coder / per day 2. OBSV charts coded per coder / per day 3. AMB SURG charts coded per coder / per day 4. OP charts coded per coder / per day 5. ER charts coded per coder / per day 6. Chart delinquency greater than 30 days 7. Total chart delinquency
Standard
20 - 24 32 - 36 32 36 130 210 130 - 210 5% 10%
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KPI Description
8. HIM DRG development hold greater than late charge hold 9. Copies of medical records pursuant to payors requests 10. Transcription rate per line 11. Transcription backlog 12. Chart retrieval pursuant to MDs requests 13. MPI duplicates as a % of total MPI entries 14. PEPPER1 potential over-codes beyond 75th percentile 15. PEPPER potential under-codes below 10th percentile
Standard
2 A/R days 2 work days 08 12 1 work day 90 minutes .5% 2% 2%
Program for Evaluation Payment Patterns Electronic Report
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KPI Description
1. Health Info Management reports to Chief Revenue Officer? 2. Use on-line DRG and APC groupers? 3. Use on-line, bar-code enabled chart location system? 4. Use on-line, scanning-enabled HIM records imaging system? 5. Use on-line and/or voice-recognition transcription system? 6. Use on-line clinical abstracting system ? 7. MDs able to view and/or e-sign records outside the hospital?
Process
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KPI Description
8. Storage / retrieval / release of records HIPAA-compliant? 9. Use on-line, up-to-date coding compliance system? 10. All coding done by employees reporting to HIM Director? 11. All coding done by certified coders who are retrained often? 12. All coding done in descending balance order, not FIFO ? 13. All coding done in best payor order (FFS, MCR, HMO)? 14. All coding done when info is sufficient, not 100% complete?
Process
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KPI Description
15. Receive and discuss denials info provided by PFS or others? 16. Provide and discuss denials / delinquency info with MDs? 17. Have effective tracking system to locate missing records? 18. Have appropriate staffing to prevent process backlogs? 19. Consistently monitor / control D-N-F-B A/R due to HIM? 20. Perform internal quality-control audits at least quarterly? 21. Have external quality-control audits done at least annually?
Process
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KPI Description
22. Review PEPPER to compare MCR pmts w/ state & natl avgs? 23. Use PEPPER to identify problem-prone DRGs? 24. Use PEPPER / OIG Work Plans to focus internal reviews? 25. Track / trend all outside record-audit requests? 26. Self-review all charts selected for audit by RACs / others? 27. Submit all self-reviews w/ Things Done Right cover letters?
Process
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Charge Entry / Revenue Integrity
KPI Description
1. Late charge hold period 2. Late charges as a % of total charges 3. Lost charges as a % of total charges 4. CDM duplicate items 5. CDM incorrect / missing HCPCS / CPT-4 codes 6. CDM incorrect / invalid revenue codes 7. CDM revenue code lacks necessary HCPCS / CPT-4 code
Standard
2 4 days 2% 1% 0 0 0 0
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KPI Description
8. CDM item has invalid / incorrect modifier 9. CDM item has missing modifier 10. CDM item price less than HOPPS APC rate 11. CDM item price is $0 12. CDM item description is Miscellaneous 13. CDM item description / price is editable on-line
Standard
0 0 0 0 0 0
122

KPI Description
1. CDM Coordinator reports to Chief Revenue Officer? 2. Have formal CDM change management process? 3. Have formal annual CDM review process with clinical depts? 4. Modifiers static coded in CDM; chosen via order-entry sys? 5. All charge items ordered via on-line order-entry system? 6. Late / lost charge perf stds in dept mgrs job descriptions? 7. Annual HCPCS / CPT-4 changes in place by Jan each year?
Process
123

KPI Description
8. Surgery HCPCS / CPT-4 appear in UB-04 form locator 44? 9. Surgery lab / X-ray charges properly unbundled? 10. CDM pricing methodology standardized / defensible? 11. Depts understand difference between billable / payable? 12. CDM items have Patient Friendly Billing descriptions? 13. Have formal annual charge sheet / ticket review process? 14. Receive / review CPT-4 manual / Addendum B annually?
Process
124

KPI Description
15. Nursing procedures (CPR, infusion, etc.) built into CDM? 16. HIM assigns interventional / surgical procedure codes? 17. ER Nursing levels match Medicare descriptions? 18. MDs OP orders received with requisite CPT-4 code(s)? 19. Order entry items map accurately to service codes? 20. Charge tickets, etc. map accurately to service codes? 21. Appropriate charge in CDM for all services delivered?
Process
125

KPI Description
22. Charge data flow reliably from points of service to claims? 23. Modifiers are conveyed correctly / reliably to claims? 24. CCI edit conflicts controlled by correct reg / charge entry? 25. Units of service accurate / flow reliably to claims? 26. Clinical depts charge awareness monitored / enhanced?
Process
Yes Yes Yes Yes Yes
126

Billing / Claim Submission
KPI Description
1. HIPAA-compliant electronic claim submission rate 2. Final-billed / claim not submitted backlog 3. Medicare supplement ins billing following adjudication 4. Non-Medicare COB-2 ins billing following COB-1 payment 5. Medicare RTP (Return To Provider) denials rate 6. Outsourced guar stmt cost to produce / mail (w/out stamp)
Standard
100% 1 A/R day 2 bus days 2 bus days 3% 20 - 25
127

KPI Description
1. Primary / secondary billing completed by dedicated team? 2. Staffing sufficient to minimize / prevent billing backlogs? 3. Quantity / quality perf stds part of billers job descriptions? 4. Perform regular quality control reviews of billers work? 5. All billers finish CMSs Medicare billing training? 6. All billers receive annual Medicare compliance training? 7. Billers cross-trained on more than one payor type?
Process
128

KPI Description
8. Use on-line electronic billing system? Easy to add new billing edits? Automatic daily downloads from PFS system? Provides final-bill download reconciliation reports? Provides biller-specific worklists? Major-payor edits supplied / supported by vendor? Claim-submit notice automatically uploaded to PFS system? Claim corrections automatically uploaded to PFS system?
Process
129

KPI Description
8. Use on-line electronic billing system (cont)? All claims (paper + electronic) editable? Standard errors automatically corrected? Provides biller-specific productivity and error reporting? Provides clinical department-specific error reporting? Automates Medicare-supplement / COB-2 claim submission? Interfaces with on-line Medicare-compliance system?
Process
130

KPI Description
9. Use Patient Friendly Billing concepts for guarantor billing? 10. Use proration to bill ins and guarantor simultaneously? 11. Guarantor stmts include credit card option? 12. Guarantor stmts clearly communicate payment policies? 13. Guarantor stmts provide customer service phone number? 14. Guarantor stmts provide customer service web address? 15. Guarantor billing cycle designed to optimize collections?
Process
131

3rd-Party and Guarantor Follow-Up
KPI Description
1. Ins A/R aged more than 90 days from service / discharge 2. Ins A/R aged more than 180 days from service / discharge 3. Ins A/R aged more than 365 days from service / discharge 4. Bad debt write-offs as a % of gross revenue 5. Charity write-offs as a % of gross revenue 6. Cost-to-collect ([PA + PFS + agency expenses] cash) 7. A/R cash as a % of net revenue
Standard
15 - 20% 5% 2% 3% 3% 3% 100%
132

KPI Description
8. In-House A/R days 9. D-N-F-B A/R days 10. Net A/R days 11. A/R cash as a % of cash goal 12. Total point-of-service cash as a % of cash goal
Standard
ALOS 4 6 A/R days 50 A/R days 100% 2 - 3%
133

KPI Description
1. High-balance follow-up completed by dedicated team? 2. Staffing sufficient to minimize / prevent aged A/R build-up? 3. Quantity / quality perf stds part of collectors job descriptions? 4. Perform regular quality control reviews of collectors work? 5. All collectors finish CMSs Medicare billing module? 6. All collectors receive annual Medicare compliance training? 7. Collectors cross-trained on more than one payor type?
Process
134

KPI Description
8. Use on-line receivables work station system? Easy to add new collector assignments? Automatic daily downloads from PFS system? Provides download reconciliation reports? Full interface for collection notes, etc. to PFS system? Provides collector-specific worklists? Worklists presented in descending-balance order? Next activity date automatically uploaded to PFS system?
Process
135

KPI Description
9. Use on-line, web-enabled 3rd-party payor inquiry system(s)? 10. Guarantor follow-up outsourced or on predictive dialer? 11. Collectors receive 3rd-party / guarantor follow-up training? 12. Collectors use 3rd-party / guarantor follow-up scripts? 13. Collectors have no competing duties (customer svc, etc)? 14. Collectors receive performance-based incentive comp?
Process
136

Cashiering / Refunds / Adjustment Posting
KPI Description
1. HIPAA-compliant electronic payment posting % 2. Transaction posting backlog (during the month) 3. Transaction posting backlog (end of the month) 4. Credit-balance A/R days (gross) 5. Medicare credit-balance report submission timeliness
Standard
100% 1 bus day 0 bus days 2 A/R days due date
137

KPI Description
1. Cashiering completed by dedicated team w/ no other duties? 2. Refunds completed by dedicated team w/ no other duties? 3. Quantity / quality perf stds part of cashiers job descriptions? 4. Perform regular quality control reviews of cashiers work? 5. All cashiers receive annual Medicare compliance training? 6. Cashiers cross-trained on more than one payor type?
Process
138

KPI Description
8. Use lockbox for non-electronic / non-EDI payments? 9. Lockbox remits payment data electronically / EDI / OCR / 835? 10. Denial transaction codes entered to facilitate follow-up? 11. Use on-line system to compare expected vs. actual pmts? 12. Post contractual adjustments at time of final billing?
Process
Yes Yes Yes Yes Yes
139

Denials / Underpayments
KPI Description
1. Overall initial denials rate (% of gross revenue) 2. Clinical initial denials rate (% of gross revenue) 3. Technical initial denials rate (% of gross revenue) 4. Underpayments additional collection rate 5. Appealed denials overturned rate
Standard
4% 5% 3% 75% 40 60%
140

KPI Description
6. Electronic eligibility rate 7. Physician pre-certification double-check rate 8. Case managers time spent securing authorizations rate 9. Total denial reason codes
Standard
75% 100% 20% 25
141

KPI Description
1. Denials tracked by payor, reason, financial consequence? 2. Denials distinguished between technical and clinical? 3. Denials tracked by physician, DRG, and department? 4. Contractual allowances increasing slower than gross rev? 5. Dedicated denials unit w/ payor-specific appeals experience? 6. Respond to clinical documentation requests w/ in 14 days? 7. Use on-line system to compare expected vs. actual pmts?
Process
142

KPI Description
8. Use on-line payment tracking software? 9. Use on-line contract management software? 10. Maintain denials database; self-developed or purchased? 11. Use on-line OP med necessity system prior to billing or svc? 12. All denial reason codes actionable? 13. OBSV and IP authorizations tracked separately? 14. Pre-cert, auth, and re-cert functions in a single department?
Process
143

KPI Description
15. Pre-certification requirements shared with MDs offices? 16. Provide MDs with regular feedback on clinical denials rates? 17. Hold regular payor meetings to discuss denials issues? 18. Contract terms regularly distributed to rev cycle employees? 19. Rev cycle employees learn of contract changes in advance? 20. Structured feedback between rev cycle and mgd care depts? 21. Non-emergency services scheduled 12+ hours in advance?
Process
144

Customer Service
KPI Description
1. Correspondence backlog 2. Walk-in patients wait time 3. ACD system average hold time 4. ACD system abandoned call % (calls on hold 30 seconds) 5. ACD system % of calls answered in 20 seconds 6. ACD system % of calls resolved in 5 minutes 7. ACD system % of calls not resolved in 10 minutes 8. Calls resolved in unit, w/out complaint / referral to Dir PFS
Standard
1 bus day 5 min 2 min 2% 75% 85% 5% 95%
145

Customer Service
KPI Description
1. Cust service handled by dedicated team w/ no other duties? 2. CS unit responsible for walk-ins, phone calls, mail, & e-mail? 3. Quantity / quality perf stds part of CS reps job descriptions? 4. Perform regular quality control reviews of CS reps work? 5. All CS reps receive annual Medicare compliance training? 6. CS reps cross-trained on more than one responsibility?
Process
146

Customer Service
KPI Description
7. CS reps cross-trained on most / all PFS system functions? 8. Use voice-mail sys so patients can request basic info / IBs? 9. Use ACD (Automated Call Distribution) system? 10. ACD system automatically maintains unit / rep statistics?
Process
Yes Yes Yes Yes
147

Collection / Outsourcing Vendors
KPI Description
1. Bad debt netback ([collections fees] placements) % 2. Bad debt fee % 3. 3rd-party EBO (Extended Bus Ofc) fee % (IP + OP + ER blend) 4. Self-pay EBO fee % (IP + OP + ER blend) 5. Legal collections fee % 6. Medicaid eligibility assistance fee %
Standard
7 11% 15 18% 6 - 10% 10 12% 20 30% 12 18%
148

KPI Description
1. Use two or more bad debt agencies? 2. Use different agencies for bad debt and EBO? 3. Write off long-term payment accts / use agency to monitor? 4. Apply Medicare bad debt 120 days rule to all fin classes? 5. Agencies / outsource vendors accept referrals electronically? 6. EBO vendor able to mirror PFS system to get notes, etc.? 7. Medicaid elig vendor have good relations w/ State agencies?
Process
149

KPI Description
8. Agencies remit gross payments / submit invoices for fees? 9. Agencies willing to put own support FTEs on-site? 10. Agencies willing to assign dedicated FTEs to your accounts?
Process
Yes Yes Yes
150

Physician Practice Management
KPI Description
1. Visits w/out charges as % of total visits 2. Co-pay collections as % of total co-pay office visits 3. EDI claims as % of total claims 4. Charge-entry lag period 5. Claims passing claim edits as % of total claims 6. Appointment no-show rate
Standard
0% 95% 90% 1 bus day 98% 2 - 3%
151

KPI Description
7. Appointment bumped rate 8. Net A/R days (non-specialty practices) 9. Collections as % of net revenue 10. Collections as % of gross revenue (non-specialty practices) 11. 3rd-Party A/R aging > 90 days from service date 12. Denials as % of net revenue (including incidental to svcs)
Standard
2 - 3% 40 days 100% 60% 10% 2%
152

KPI Description
13. Claims w/ no activity > 90 days from last activity date 14. Credit balances 15. Average patient wait time after office arrival
Standard
0% 2 A/R days 15 minutes
153

KPI Description
1. Send voice and mail reminders for regular annual visits? 2. Send voice and mail reminders for other scheduled visits? 3. Use open scheduling to increase walk-in capacity? to minimize appointment bumping? to increase patient satisfaction? to reduce nursing callbacks?
Process
154

KPI Description
4. Calculate net revenue and net receivables? 5. Use dedicated billing / follow-up FTEs w/ no other duties? 6. Use collection agencies?
Process
Yes Yes Yes
155
Lets pause and define terms... Contracting Cycle
156

Contracting Cycle Definition
1. Provide patients 4. Pay claims
2. Treat patients 3. Submit claims

157

Reduce Payor Discretion
Achieve Target Margins

158

Analyze Contract Performance Collect Accounts & Post Payments Work Denials & Payment Variances Submit & Follow-up Claims Define Payors & Providers Duties Negotiate Contract Language & Rates Analyze Service Lines Analyze Financial Needs Understand Competitors & Market Understand Payors & Their Reputations Analyze Steerage vs. Discounts
159

Contracting Cycle Definition Strategy development Strategy implementation Contract negotiations Contract evaluation Forecasting and analysis Contract implementation and operations Performance monitoring Strategic issues and planning
SOURCE: Stevenson, Managed Care Cycle Provides Contract Oversight, hfm
160

Managed Care Contracting
KPI Description
1. Rate increases compared to CPI medical-care component 2. Outlier $ fraction of total contract revenue 3. Contract profitability compared to IRR hurdle rate 4. Eligibility / authorization / certification availability 5. Retro review / timely filing periods (keep in balance) 6. Termination notification period (without cause) 7. Renegotiation planning begins prior to renewal date 8. Optimal contract term
Standard
CPI MCC 5% IRR HR 24 / 7 / 365 90 120 days 90 days 6 months 2 3 years
161

KPI Description
1. Contract contains automatic renewal clause? 2. Contract contains inflation index? 3. All hospital services included / specific exclusions defined? 4. Termination notification period = 90 days? 5. Duties for on-going patient care / pmt at termination defined? 6. ABN or equivalent acceptable for non-covered services? 7. Provider authorized to bill guarantor for non-covered svcs? 8. Hospital-based MDs use hospital-obtained authorizations?
Process
SOURCE: Managed Care Forum Contracting Checklist, HFMA Wants You to Know
162

KPI Description
9. Provider authorized to collect deposits for non-covered svcs? 10. Contract discloses all sub-contracting relationships? 11. Contract contains an independent contractor clause? 12. Contract excludes most favored nation provisions? 13. Contract start date clearly defined (to prevent A/R build up)? 14. Contract stipulates all parties pay own legal fees? 15. Definition / criteria for all key terms clearly stipulated? Medical necessity? Emergency condition / emergency admission?
Process
Yes Yes Yes Yes Yes Yes Yes Yes Yes
163

KPI Description
15. Definition / criteria for all key terms clearly stipulated (cont)? Trauma / trauma services / trauma team? Covered services? Material breach? Prompt payment? Stop-loss / outlier? Carve-out? Medicare rate? (should include pass-throughs)
Process
164

KPI Description
15. Definition / criteria for all key terms clearly stipulated (cont)? Sentinel event(s)? Medical-loss ratio? Silent PPO? Clean claim? Timely notification / timely filing? Authorization / certification?
Process
165

KPI Description
15. Definition / criteria for all key terms clearly stipulated (cont)? Service level(s)? Denial / rejection / null event? Negotiation / mediation / arbitration? Plan agreement? Inpatient / outpatient / emergency patient / obsv patient? Substantial impact? Member / insured / dependent?
Process
166

KPI Description
16. Advance notice time for contract changes clearly stipulated? Payment / reimbursement rates? Covered services / procedures? Plan documents / requirements? Major employer groups?
Process
17. Contract includes warranty of HIPAA compliance? 18. Contract forbids reassignment without mutual consent? 19. Payors reporting requirement duties clearly stipulated?
167

KPI Description
20. Contract clearly material to providers revenue stream? 21. Eligibility verification process clearly stipulated? 22. Medical necessity verification process clearly stipulated? 23. Prior authorization process clearly stipulated? 24. Payor provides all customers contract / policy manuals? 25. Payor provides copies of all administrative / policy manuals? 26. Appeal / independent review processes clearly stipulated? 27. Payor precluded from changing reimbursement unilaterally ?
Process
SOURCE: 15 Questions to Ask Before Signing a Managed Care Contract, Private Sector Advocacy
168

KPI Description
28. Payors prompt payment duty clearly stipulated? 29. Payor agrees to pay interest on late payments? 30. Contract complies with statutory processing / pmt duties? 31. Payor precluded from takebacks / offsets? 32. Retro review period balanced to timely filing period? 33. Contract precludes participating in / enabling Silent PPOs? 34. Termination provisions / timing clearly stipulated? 35. Contract terms supersede provisions in Provider Manual?
Process
SOURCE: 15 Questions to Ask Before Signing a Managed Care Contract, Private Sector Advocacy
169

KPI Description
36. Perform annual internal analysis of all contracts? Contractual discounts balanced to gross volumes / net rev? Use analysis to identify renegotiation / termination targets? Compare all contracts to Medicare fee schedule? Calculate relative profitability using payor-specific costs? All contracts cover their direct costs, at minimum? Use relative profitability for leverage during renegotiation? Recognize internal review cannot I.D. below-mkt contracts? Recognize internal review silent on case mix/stop-loss/etc.?
Process
SOURCE: Wilson, David et al, 3 Steps to Profitable Managed Care Contracts, hfm
170

KPI Description
37. Perform annual external analysis of all contracts? Compare (legally) your rates to those of similar providers? Use outside firms / databases to obtain comparative info? Challenge datas age / geographic relevance before using? Compare specific service lines, as well as overall rates? Target biggest upside opportunities during renegotiation? Compare pmt structures (charge % / DRGs) + overall rates? Understand impact of I/P stop-loss / O/P max-pay clauses? Try to end all cost-plus pmts in favor of % of charges?
Process
171

KPI Description
37. Perform annual external analysis of all contracts (cont)? Review contract language, especially key terms / clauses? Claim submission and payment Protection against catastrophic cases Procedure-based carve-out payments Stop-loss payment structures Pmts for implants / prosthetics / orthotics / high-$ drugs Cut-off date for timely filing / retro review / refunds / etc. Utilization review process New services / technologies SOURCE: Wilson, David et al, 3 Steps to Profitable Managed Care Contracts, hfm
Process
Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes
172

KPI Description
37. Perform annual external analysis of all contracts (cont)? Compare payment levels to premium increases? Ensure rate trends mirror premium increase trends? Compare payors relative profitability trends? Compare rate trends to medical-care component of CPI?
Process
Yes Yes Yes Yes Yes
173

KPI Description
38. Conduct annual pmt performance analysis of all contracts? Contracts comply with statutory processing / pmt regs? Report habitual violators to Insurance Commissioner? Compare payors denial / pmt discrepancy trends, by group? Insurance plan? Patient type? Service line? Reason code? Physician?
Process
174

KPI Description
39. Contract defines documentation reqd to prove timely filing? 40. Contract reviewed by attorney before renewal? 41. Soft contract provisions (quality / affordable) avoided? 42. Reasonable efforts term used to define providers duties? 43. Both parties agree not to disclose negotiated rates? 44. Supplemental documents included by reference / attached? 45. Amendments required in writing with mutual signatures? 46. Participating corporations / entities clearly stipulated? 47. Assignment clauses clearly stipulated / require signatures?
Process
SOURCE: Miller, Thomas, Conducting a Managed Care Contract Review, Healthcare Financial Management
175

KPI Description
48. Start up payors post security deposit / letter of credit / etc? 49. Contract parties independent and able to compete? 50. Provider listed as participating in directories / websites? 51. Complete list of covered services attached to contract? 52. Provider can reduce malpractice ins to state law minimums? 53. Ambiguous service descriptions avoided? Avoid services including but not limited to Avoid services customarily provided Avoid services covered by the plan
Process
176

KPI Description
54. Services not directly provided defined / contracted in adv? Out-of-area services Hospital-based physician services
Process
55. Capitation rates / benefits design (if any) clearly stipulated? 56. Flat-rate contracts w/ payors known for excessive bundling? 57. Licensing / JCAHO standards adequate for credentialing? 58. Provider not required to report in accordance with HEDIS? 59. Contract / payment terms administratively feasible? 60. Current HIS adequate to handle contract terms / A/R needs?
177

KPI Description
61. Mutual information requirements clearly stipulated? Specific information / reports described? Information including but not limited to avoided? Providers confidential / proprietary information protected? Providers duty to provide info to payor strictly limited? Payor obligated to reimburse costs of providing records?
Process
178

KPI Description
62. Mutual duties regarding care reviews clearly stipulated? 63. Providers duty to notify payor re: adverse events limited? No duty re: patient complaints? No duty re: risk management incidents? No duty re: physician malpractice suits? No duty re: physician status changes? No duty re: medical staff disciplinary actions? Notify only when sued by members at time of event? Notify only on intent to report adverse event to regulators?
Process
179

P4P: Clinical Decision Support / Finance
KPI Description
1. P4P Demonstration Project percentile ranking 2. P4P Demonstration Project bonus achievement 3. Length of stay, by DRG 4. Readmission rate, by DRG 5. Adherence to quality indicators, by condition 6. Adherence to quality indicators, by mode 7. Overall P4P program ROI
Standard
80% 1% DRG avg DRG avg 80% 80% 0%
180

P4P: Clinical Decision Support / Finance
KPI Description
1. Use advanced clinical systems to support patient care? 2. Use electronic medical record system to support patient care? 3. Use advanced decision support / performance mgt system? 4. Use executive information (scorecard) system? 5. Use data warehouse to support DSS / EIS capabilities? 6. Participate in CMS Demonstration Project, if eligible? 7. Have clinical improvement teams in data-enabled depts? 8. Target greatest cost / quality improvement areas first? 9. Use root cause analysis to focus improvement efforts?
Process
181

Hammer Map Kpis Hfma NJ 11 Jan 2011

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HFMA-NJs PFS Quarterly Meeting Woodbridge Hilton 11 January 2011

Key Performance Indicators (KPIs): Strategies for a High-Performance Revenue Cycle

Content and Organization

Content and Organization (contd)

Even the VERY BEST Keep Score!

Even the VERY BEST Keep Score!

If you cant measure it, you cant manage it.

Wheres Your Focus?

HFMAs PATIENT FRIENDLY BILLING Project

HFMAs PATIENT FRIENDLY BILLING Project Standards of Excellence: Goal

A pictures worth a thousand words

Organization and Management

Organization and Management

CHARGE CAPTURE & ENTRY REGISTRATION & POS CASH COLLECTIONS

CLAIMS & INVOICE PROCESSING

FIRST & THIRD-PARTY FOLLOW-UP

REMITTANCE & DENIAL MANAGEMENT

DATA ANALYSIS & REPORTING

Organization and Management

8 MEDICAL RECORDS & CODING

9 CLAIM SUBMIT 10 PARTY FOLLOW-UP 3RD

4 REG + POS COLLECTIONS

11 PMT + ADJ POSTING

3 INS VERF 2 PRE-REG & PRE-CERT 13 DENIAL & APPEAL MGT

12 DENIAL PROCESSING 1 SCHEDULING 14 Revenue CONTRACT ADMIN

SOURCE: PriceWaterhouse Coopers

Organization and Management

8 MEDICAL RECORDS & CODING

RACs & MICs

3 INSURANCE VERIFICATION 2 PRE-REG & PRE-CERT 13 DENIAL & APPEAL MANAGEMENT

Affiliated & Employed MDs

14 CONTRACT NEGOTIATION / ADMIN.

SOURCE: PriceWaterhouse Coopers

What is HFMAs MAP initiative?

HFMAs MAP Initiative

HFMAs MAP Initiative

MAP is a comprehensive performance-improvement strategy

HFMAs MAP Initiative

MAP Keys are provider-developed revenue cycle key performance indicators

HFMAs MAP Initiative

MAP Keys focus on key areas of revenue cycle performance

HFMAs MAP Initiative

Purpose | Value | Calculation

Example Net days in A/R

HFMAs MAP Initiative

HFMAs MAP Initiative

Comparing Performance: Flexible comparisons for in-depth analysis

0% Jan 09 Mar 09 May 09 Jul 09 Sep 09 Nov 09

Bad Debt vs Charity Care as % of Revenue

What is HFMAs MAP Award?

HFMAs MAP Award

HFMAs MAP Award

HFMAs MAP Award

Improvement Opportunity: POS Collections

HFMAs MAP Award

OVERALL TOP 25th TOP 10th RANGE PERCENTILE PERCENTILE

9.47% 0.29% 13.50 0.13 51 95%

1.30% 6.3 78%

0.90% 2.7 82%

HFMAs MAP Award

HFMAs MAP Award

How should you measure performance?

Key Performance Indicators