Member Spotlight
Q and A with Jill Schumann Rumberger, PhD, MBA, Chair of the Financial Systems Revenue Cycle Task Force
Jill Schumann Rumberger, PhD, MBA, applies her more than 25 years of practical experience in the private sector in her role as an assistant professor in health administration at Pennsylvania State University in Capital College. Ms. Rumberger teaches finance, economics and information systems in the Masters in Health Administration Program. Throughout her career, she has designed and developed a wide variety of financial analysis tools that include cost/benefit, cost-effectiveness and breakeven models.
1. Why is it important to integrate finance and information technology (two topics you teach as an assistant professor of health administration at Pennsylvania State University) in today's healthcare market? How is this integration addressed in your courses?
I just asked my students to do an inventory throughout the next week of where information technology impacts their lives. I think they will be surprised at how pervasive IT is within our society.
In today’s healthcare market, increasing pressures are coming from all key stakeholders to hold costs down and improve quality. It is important for all healthcare providers, from a large health system to the physician office to the long-term care facility, to effectively utilize all the tools they have to hold costs down, while improving patient quality of care. Information technology is one of the most important tools leadership can use to achieve this objective.
In addition, for the first time, the industry is seeing payment tied to quality through pay-for–performance initiatives by CMS. In order to maximize reimbursement, it is critical to tie clinical systems with payment systems to justify performance and patient quality. Given the complexities of today’s marketplace, it would be impossible to manage the financial aspects of a physician practice or large health system without using information technology tools to capture data that can be turned into financial information.
2. What has driven the increased attention to developing better revenue cycle processes, tools, etc., for the healthcare market?
Several major changes are underway that are directly responsible for this increased attention. First, the healthcare consumer is demanding increased levels of convenience, service, quality and efficiency. At the same time, that same consumer is experiencing greater out-of-pocket expenses, as a result of changes within payment structures in existing types of health plans and new consumer-driven plans. Secondly, providers of healthcare services are seeing a range of new initiatives including:
- HIPAA claims attachment rules
- National Provider Identifier (NPI)
- Medicare Severity-adjusted Diagnostic Related Groups (MS-DRGs)
- International Classification of Diseases – the ICD-10 coding system
- Medicare recovery audit contractors (RACs)
- Pay-for-performance
- Price and quality transparency
- Consumer-directed health plans
- Substantial increase in the self-pay fraction of the payor mix
- 5010 implementation with ICD-10
All of these initiatives impact the revenue cycle.
3. What are the benefits of revenue cycle management to a healthcare organization's financial and business operations? How about to its providers and consumers?
Opportunities exist for healthcare organizations’ financial and business operations to benefit from revenue cycle management in a variety of ways, including improved days in accounts receivables, decreased bad debt, improved liquidity and return on equity, and improved cash on hand. Providers have the opportunity to benefit from the same financial performance issues in managing their own practices’ cash flows and financial performance. Consumers benefit because their financial responsibilities are known at the beginning of the care delivery process, rather than at the very end.
With growing consumer-driven health plans with large deductibles and co-pays, it is important for consumers, providers and health systems to know exactly what the reimbursement and payment responsibilities will be for services before they are given.
4. As chair of the Financial Systems Revenue Cycle Task Force, what was the objective in drafting the white paper Re-engineering the Revenue Cycle for the Emerging Medical Consumer, recently published on HIMSS' Web site?
The task force agreed it was important from a health system perspective to summarize all the various forces coming together today that are changing how healthcare delivery is financed and investigate the role of information technology in helping to address this change. We started with the development of the tool Revenue Cycle Touch Points in Patient Encounter Life Cycle, an Excel spreadsheet available through a link in the white paper.
5. What initiatives/actions will the Financial Systems Revenue Cycle Task Force work on during this FY?
We will be finalizing our plans as a group at next month’s meeting, but we definitely will be sharing the information in the white paper at several conferences. One of the major actions under discussion is exploring the key performance indicators for revenue cycle management that will quantify the benefits of processes enhanced with RCM tools, such as information technology. We believe the industry would gain from an objective evaluation of RCM benefits in light of the operational changes a RCM system can bring to an organization.
6. Switching gears, please tell us about your most recent vacations and where you’ll be going next.
My husband and I enjoy traveling. This past summer, we spent time at our cabin on an island in the Susquehanna River near where we live in Pennsylvania. My husband’s family homesteaded the island in the late 1800s and today we use it for recreational purposes. You can only get there by boat and there is no electricity, just a generator to pump up the water from the well. It is a great escape. In summer 2007, we had a wonderful experience on a small ship cruise to Alaska. Small ship cruising is usually on boats with less than 100 people. The cruise theme was a focus on the environment and preserving the Alaska natural environments. Next year, we plan to go to Machu Picchu and the Galapagos Islands.
Upcoming Events
CAQH Administrative Simplification Conference
Sept. 24 – 25
Omni Shoreham Hotel, Washington, DC
2008 HIMSS Public Policy Forum
October 28
National Press Club, Washington, DC
World of Health IT Conference & Exhibition 2008
Nov. 4-6
The Bella Center, Copenhagen, Denmark
HIMSS Virtual Conference & Expo
Nov. 19-20
Online, At Your Desktop
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April 4-8
Chicago
Registration and housing/travel is now open.
Featured Event
New—HIMSS Electronic Prescribing Solutions Showcase
October 6-7
Sheraton Boston Hotel & Towers
New federal legislation establishes mandatory electronic prescribing for the Medicare Part D prescription drug program set to begin in January 2009 with a 2% increase in reimbursement for providers that employ electronic prescription software. Be one of the first to view the latest technology solutions available for you to participate in this new federal reimbursement program at this exclusive HIMSS-sponsored E-Prescribing Solutions Showcase.
For more information, please contact Jonathan French, Project Manager, at 703-562-8822, and for exclusive sponsorship opportunities, please contact Kelly Laidler, Senior Director of Sales, at 312-915-9285.
Call for Participation: Financial Edge
Share your feedback on Financial Edge. Let us know what you’d like to see in future issues and if you’d like to participate in planning and developing newsletter content. Contact Pam Matthews, CPHIMS, HIMSS Senior Director, Healthcare Information Systems, or Nancy Vitucci, HIMSS Manager, Publications.
Supporters Vow to Revive Nurse-Patient Ratio Bill
By Fred Bazzoli
Legislation in Massachusetts to set nurse-to-patient staffing ratios in hospitals was stalemated last month, killing the initiative for the rest of this year.
Proponents of the legislation, which would require hospitals to have a pre-determined ratio of nurse professionals to care for patients, promise to seek legislative action next year.
Welcome to Financial Edge
Financial Edge, HIMSS’ financial systems eNewsletter, is your source for the latest issues and emerging trends focused on financial systems and related technologies within healthcare delivery.
Share Financial Edge with colleagues, co-workers, friends and anyone involved in connecting clinical and financial systems. If you have received this issue as a courtesy and would like to receive future issues, click here to subscribe.
Story ideas other comments can be emailed to Nancy Vitucci, Manager, Publications.
Don’t Miss Medical Banking Webinar
Wednesday, September 24
12:00pm – 1:30pm EST
Medical Banking 101 Presentation for Chapter Leaders, a free Webinar, will highlight the medical banking solutions and evolving trends for payment and remittance processing that are creating a strategic opportunity to improve the revenue cycle, enabling providers to save $35 billion+/year. Participants will:
- Learn about medical banking and how banking infrastructure and systems are being integrated with healthcare administrative operations to drive EDI-enabled workflow processes into the heart of the healthcare delivery system.
- Discover how the medical banking market is poised to impact healthcare.
Guest speaker Rick Morrison, Vice President, WJM, Inc., is considered an industry expert with respect to Medical Banking. The former CEO of Remettra, Inc., Mr. Morrison currently serves on the HIMSS Financial Banking and Healthcare Task Force and Financial Systems Steering Committee. In addition, he is the ex-officio officer on the Medical Banking Project President’s Council and a former president of the Medical Banking Institute.
Register today for this free event.
*Special acknowledgment is extended to John Casillas, chair, Medical Banking Institute, executive director, Medical Banking Project, for his support and materials provided for this event.
HIMSS Prepares Response to HHS’ Proposed ICD-10 Code Sets and Updated Electronic Transaction Standards
HIMSS is facilitating a response to proposed regulations, announced by HHS last month, to replace the ICD-9-CM code sets now used to report healthcare diagnoses and procedures with greatly expanded ICD-10 code sets, effective October 1, 2011. In a separate proposed regulation, HHS has proposed adopting the updated X12 standard, Version 5010, and the National Council for Prescription Drug Programs standard, Version D.0, for electronic transactions, such as healthcare claims. Version 5010 is essential to use of the ICD-10 codes.
Those interested in participating in HIMSS’ efforts can contact Holly Gaebel, coordinator, healthcare information systems. View the ICD-10 code sets proposed rule and the updated transaction standards proposed rule. Fact sheets describing both proposed rules are available. Comments on both proposed rules are due by 5:00pm EST on October 21.
Medical Banking and the Public’s Need for Privacy and Security
By Patti Velasco
Regularly, one can read about a breach of an individual’s confidential information by some organization or a case of identity theft. With each new report, consumers become more concerned about the privacy and security of their data, especially as that information is handled more and more in a digital fashion. Banks have a rich history of protecting customer’s financial data, but as they increase the medical banking services offered to healthcare providers and payors, it becomes even more critical that they have safeguards in place that specifically protect personal health information (PHI), as well as financial data.
Back in 1996, John Casillas urged the industry to address this issue. By 2001, he founded the Medical Banking Project (a member-supported collaborative of government, commercial, and academic entities seeking to optimize banking systems for the benefit of healthcare organizations) and gained national consensus on the importance of an accreditation program for health data privacy and security within emerging medical banking operations. With the rising concern over unintended release of PHI and the burgeoning medical banking industry, the group decided to create the industry’s first Gold Seal Accreditation Program to address these concerns.
The Gold Seal Program was developed over a two-year period as a cross-functional accreditation council assessed various banking and healthcare regulations, security and privacy frameworks, and existing accreditation programs. The result, the Medical Banking Project Gold Seal Program, is an Internet-based survey that measures reported practices and controls in place at an organization against objective criteria and commonly accepted practices. The program reviews criteria across 24 modules including areas such as Business Associate Agreements, Business Continuity, Computer Operations, Office Email and Internet Use, Security Management and Administration, Operating Systems and Server Room.
The program was first piloted at The Bank of New York Mellon. After identifying the appropriate subject matter experts for each of the criteria, the various modules were completed within 2 days. In general, the pilot users felt the program was easy to administer and encompassed areas that address privacy and security. Along with feedback from the pilot participants, the Gold Seal Program will be continually reviewed and enhanced to insure criteria are sound and relevant. The Gold Seal Program is expected to be rolled out in December.
Overall the Medical Banking Project’s Gold Seal Program is anticipated to be a cost-effective accreditation program that:
- Complements an organization’s existing internal compliance programs and external audits,
- Provides an independent HIPAA compliance assessment,
- Identifies potential gaps in existing compliance processes and policies,
- Demonstrates an organization’s documented due diligence and
- Promotes market confidence through public and government acceptance.
Click here for more information on the Gold Seal Accreditation Program.
Patti Velasco is executive vice president, healthcare transaction services, for Thelma-US, Inc. and serves on the Accreditation Review Council that oversees the Gold Seal Accreditation Program for the Medical Banking Project. For more information, she can be reached at patti.velasco@thelma-us.com or 850-893-6317.
CORE: Transforming Electronic Transactions in Healthcare
For the first-time, providers are able to receive consistent electronic information about patient deductible balances from potentially any health plan before or at the point of care. This achievement is the result of voluntary business rules developed during the second phase of activities conducted by the CAQH Committee on Operating Rules for Information Exchange (CORE), a collaborative, multi-phase healthcare industry initiative. The CORE Phase II rules build on the Phase I rules, which were introduced in 2006.
Financial Edge spoke with Gwendolyn Lohse, Deputy Director, CAQH and Managing Director, CORE, about CORE’s business rules.
Q: What are the CORE rules?
The CORE rules are a set of voluntary business rules modeled on those used in the banking industry to enable electronic transactions. They are developed collaboratively by more than 100 healthcare industry stakeholders, including health plans that cover about 75% of commercially insured lives, and a number of government entities. CORE rules build on existing standards, such as HIPAA, to make electronic transactions more predictable and consistent, regardless of the technology being used.
Q: How do the CORE Phase II rules streamline verification of patient financial responsibility?
Phase II enables providers to determine patient remaining deductibles and other patient liability for 39 service types, in addition to the nine types included in Phase I. Further, providers can electronically check the status of a claim and/or confirm payor organization receipt of the claim—with payors required to respond to claim status requests within 20 seconds. Moreover, information exchanges certified by CORE offer a safe harbor connectivity rule to facilitate interoperability across organizations; the connectivity method can be used for any administrative transaction. Providers, patients, plans and vendors all benefit from streamlined transactions that make data exchanges more efficient.
Q: Why should organizations become CORE-certified?
Beyond promoting interoperability and phased steps toward administrative-clinical infrastructure alignment, CORE rules decrease the amount of time and resources providers and plans spend verifying patient benefits at the point of care.
Click here for more information about CORE.
A Member’s Perspective: Exploring Current and Future Trends with Revenue Cycle Management White Paper
HIMSS’ newly released white paper Re-engineering the Revenue Cycle for the Emerging Medical Consumer explores the external forces within healthcare that are currently impacting revenue and suggests what the revenue cycle of the future might look like, as technology changes focus on patient satisfaction, consumerism and quality. Prepared by the FY08 Financial Systems Revenue Cycle Task Force, the paper identifies best practices and current and future technology trends.
Jim Gaddis of HIMformatics, LLC, has utilized the white paper when discussing revenue cycle management with clients. “The white paper has been absolutely valuable,” Mr. Gaddis says. “I have used this material to educate my clients about the current and future state of revenue cycle systems and to alert them to the challenges they will likely face in the near future due to the emerging medical consumer. We work together to forge a plan for how clients can meet the expected challenges.”
To share your thoughts on how this white paper and other financial systems tools developed by HIMSS have provided you with practical information and hands-on strategies, email Nancy Vitucci, Manager, Publications.
Viewpoint: Electronic Remittance Advices (ERAs)—Automating Payment Posting
Electronic remittance advices (ERAs), electronic files containing claim payment and remittance information, reduce or eliminate the need for manual posting and update patient accounts receivables more quickly. With simplified administrative processes, providers’ workflow and productivity are improved.
We posed the questions “Do you think improved workflow and productivity have been achieved in your office?” and “What challenges are you facing with ERAs?” to a few of our industry stakeholders. Here is what they are saying:
I definitely think that ERAs have improved productivity by allowing revenue cycle staff to focus more time on value-added tasks. We currently post approximately 75% of our insurance payments using ERAs. Postings are now completed on the day remittances are received. The time saved using ERAs has allowed us to create a dedicated position for denial management. We are also spending more time comparing actual insurance payments against contracted rates.
The biggest challenge we have is when a payor is making a secondary payment. For some reason, they want to report the primary payor’s contractual allowance back to us instead of the secondary contractual. This results in a credit balance that requires manual intervention. Our ERA vendor has helped us by not posting the incorrect contractual, which has greatly reduced credit balances. However, the accounts must still be reviewed to see if a secondary write-off is required.
—Larry W. Morris, FHFMA, Revenue Cycle Director, Stormont-Vail Regional Health Center, Topeka, Kan.
Streamlining Payment and Remittance Management
Certainly, ERAs offer dramatic efficiencies over paper-based explanation of benefits. But along with getting the ERA, the physician practice receives a payment from the insurer, either in the form of a paper check or an electronic funds transfer.
Indeed, the transition to electronic transactions represents marked improvements over paper processes. However, there remains the fundamental problem of two highly related but completely unlinked streams: the ERA and the payment. Making a bad situation worse, a payment might arrive before or after an ERA. As a result, the practice resigns itself to manually reconciling the unlinked data and posting payments to their PPM system. True operational efficiency remains elusive.
A solution automatically matching electronic remittance and payment data, while ensuring data integrity and security, is a step in the right direction. The result is a ‘reconciled’ ERA that can be auto-posted to the PPM system, allowing the practice’s bank account and PPM system to be in sync, while offering the practice significant time and cost savings.
—Greg White, Executive Marketing Director, RelayHealth
A major concern in today’s healthcare industry is finding ways to reduce costs and increase efficiency without sacrificing patient care. One way to accomplish this is to evolve to an electronic payment model. For all the progress made automating the claim submission process in recent years, little has been done to the payment process to match that automation. However, now more than ever, electronic solutions are readily available to help eliminate the paper payment process all together.
Today, ERAs can be loaded automatically and posted directly into a practice management system. Couple that with electronic fund transfers, and the whole payment process can be reconciled without ever touching a piece of paper.
Ultimately, this simplified workflow results in faster access to reimbursements, decreased costs and increased efficiency—leaving staff with more time to focus on other ways to increase revenue for your business.
—David Peterson, Vice President, Product Marketing, Research & Intelligence, Emdeon
ERAs offer significant benefits over paper-based methods currently used by many providers today:
- Information is delivered much faster.
- Data can be viewed in a number of different ways (Total amount paid, individual provider claims, individual patient claims, etc.).
- Many payors’ ERA reports allow sorting of data by day, by provider, by patient, etc., which can improve AR management efficiency.
- Uploading ERA data to the PMS or billing system allows for posting of payments with just a few clicks.
However, kicking the paper habit can be tough for many provider organizations, especially those who may not have used electronic communication with payors in the past. To help staff adapt, note that some plans offer a honeymoon period during which provider offices can get both paper and electronic information. It may also help to remind those who remain "hooked on paper" that they can still print their ERA reports.
—Peggy Denness, Director of Provider Advocacy, NaviMedix, Inc.
We would like to hear from you. Please submit your view on ERAs to Nancy Vitucci, HIMSS Manager, Publications.
Looking ahead to the October Viewpoint, our topic will be:
Risk Analysis—How Upgrading Systems Can Impact Revenue
When planning a system upgrade, providers must consider the impact on revenue and ensure vendors are on schedule with system updates. Conducting a risk analysis can ensure all systems are “talking” with one another.
If all the necessary steps for updating software and interfacing with adjudication systems and databases have not been explored and a “gameplan” outlined, how will this affect a provider’s revenue cycle?
Click here to submit a 150-word editorial outlining your perspectives on Risk Analysis. Submissions are due by close of business on Monday, October 13th.
HIMSS Launches New Financial Systems Work Groups
HIMSS is looking for volunteers interested in participating in the new financial systems work groups:
- Financial Edge Work Group: This work group will support HIMSS’ new financial systems eNewsletter. Work efforts include identifying authors and content and monitoring the newsletter performance scorecard. Visit Financial Edge.
- Public Policy Work Group: This work group will support HIMSS activities by responding to public comment periods, participating in industry calls, such as with CMS, and supporting industry testimonies/other public presentations focused around financial systems.
Participation in these groups is open to all active HIMSS members. Work activities are conducted through monthly, one-hour conference calls. If you are interested in participating or have any questions, please contact Holly Gaebel. These work groups are supported by HIMSS Staff Liaisons Pam Matthews, CPHIMS, senior director, healthcare information systems, and Holly Gaebel, coordinator, healthcare information systems.
Tools/Resources of the Month
Real-Time Adjudication White Paper
Real time adjudication (RTA) of healthcare claims gives providers the ability to bill for service at the time of service. Before the patient leaves the office, the provider submits a claim and receives a fully adjudicated response back from the payor. With more payors offering high deductible health plans, expanded use of RTA for healthcare claims is changing the healthcare market for providers, payors and consumers. The newly released white paper Real Time Adjudication of Healthcare Claims, now available on the HIMSS Web site, examines how prepared the industry is for increased RTA use. A work product of the FY08 Financial Transactions Toolkit Task Force, the paper offers recommendations for how to prepare from both a technological and process perspective.
HIMSS Grants Advantage
Through the new HIMSS Grants Advantage service, HIMSS members’ can access healthcare IT grant information from a variety of funders through a single reliable source—saving time and money. This service offers education, mentoring and collaboration spanning from identification to submission to receipt of award and to closure. Other features include an exclusive toll-free phone number for support; monthly Webinars featuring topics of interest and best practices among grantees in the industry; a moderated listserv to facilitate discussion among subscribers; a report suite of weekly updates; a quarterly e-newsletter; FAQs; a SharePoint portal for additional collaboration; and a discount for grants writing services. Click here for more information, including details on how to subscribe.
Expand Your Network: Get Linkedin With HIMSS
HIMSS has created a HIMSS Linkedin Group to further connect its members and beyond. Linkedin is a networking tool that helps professionals discover inside connections, industry experts and business partners. More than 3,000 members, healthcare IT experts and leaders have joined the HIMSS Linkedin Group to not only strengthen and extend their networks but participate in the discussion forums. Get Linkedin with HIMSS today!
Reminder: HIMSS Calls for Award Nominations and Scholarship Applications Now Open
The Call for Nominations for the 2008 Awards and the 2008 Call for Scholarship Applications are now open; both will close next month.
Award Nominations—Call Closes Oct. 30
Nominations for awards, which recognize the special contributions of individuals, groups and organizations to the advancement of the healthcare profession as encompassed by the Society’s mission, must be submitted online at www.himss.org/awards. Awards are presented in four categories: Industry, Service, Publications and Chapters; a complete list is available online. Contact awards@himss.org or call Member Services at 312-915-9202 for more information.
Scholarships Applications—Call Closes Oct. 31
Through the HIMSS Foundation Scholarship Program, student members studying in the healthcare information or management systems field are recognized for academic excellence and the potential for future industry leadership. Recipients receive a cash award and an all-expense paid trip to HIMSS09 in Chicago (some restrictions may apply). Scholarship applications are available online. For more information, contact HIMSS Coordinator of Member Services Yvonne Horton at yhorton@himss.org.