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By Beckey Cooper Baker
Vice President, Revenue Cycle
Wellmont Health System, Kingsport, Tenn.
Staying Alert for the Latest in Best Practices
"Excellence is a journey, not a destination." It's a philosophy that we have taken to heart when it comes to revenue cycle management at Wellmont Health System, a nine-hospital organization based in Tennessee. That philosophy has helped us face the myriad challenges inherent in the business of delivering healthcare.
To continue our journey to excellence, we read industry publications, identify best practices, and then do what we can to bring our operations up to, and beyond, industry benchmarks. We implement a process change, staffing reorganization or technology enhancement at least once a month, if not more frequently.
Most recently, we took on the challenge of reducing our level of bad debt — a growing concern as private and government payors tighten their belts, and patients become responsible for a larger share of their healthcare bills. By combining the use of information technology with ongoing process change, we've been able to reduce our bad debt expense as a percentage of gross revenue 13.5% over the past two years.
Using Continuous Improvement to Achieve Goals
To achieve such results, we employ a continuous performance improvement model where we measure current results, analyze them to find opportunities for improvement, and then intervene in the current process by implementing a change. Then we monitor the results to evaluate exactly what each process change is bringing to the table. We are always asking: Has the intervention helped us progress toward our goal? If necessary, we make modifications and measure the results again.
McKesson's Web-based business analytics solution, which provides analysis, reporting and scorecarding, is the engine that drives this continuous performance improvement cycle. With this tool in place, revenue cycle leaders and employees gain secure access to timely information — a real boon to our performance improvement efforts.
For example, if the CFO calls and asks why accounts aged over 90 days have increased, I can simply go into the system, drill down to the patient account level and come up with an answer. I can analyze the accounts by patient responsibility or financial class, or by any one of a number of other criteria to determine the explanation for the problem. With this information in hand, I can then formulate a potential solution and take the action required to ensure that these accounts do not morph into bad debt.
Results of our "Measure, Analyze, Intervene" Strategy
Our "measure, analyze, intervene" approach has helped us improve revenue cycle practices by:
 Implementing a process to verify insurance eligibility online at
the point of service. Using the patient's insurance information, we
go to individual payor Web sites to determine a patient's financial
responsibility. With this process in place, we have increased our
upfront cash intake 237%, from about $81,000 per month in
2006 to more than $273,000 per month in 2008.
Sending statements to patients at opportune intervals via an
automated billing scheduler. With this automation in place,
patients are much more likely to comply with payment requests.
Reducing claims processing time by three days because
employees can more efficiently access needed information using
an electronic medical records system.
Using analytics to identify workflow problems – and then
implementing the appropriate staffing changes to address them.
For instance, we shifted all workers' compensation claims to one
employee who had developed relationships with these
companies. This shift resulted in significant improvement in the
time to process claims.
Processing Medicare claims through a grouper twice a day,
instead of just once, which has enabled us to reduce the time it
takes to submit these claims from an average of about six days
to just three days.
Implementing all of these improvements has enabled Wellmont to enhance revenue cycle processes and improve interactions with patients. In the final analysis, our results clearly illustrate how we are, in fact, "doing better" and optimizing performance: In June 2006, we carried $2,271,045 or 2.1% of total revenue in bad debt, whereas in May 2008, we carried only $1,876,916 or 0.9% of total revenue in bad debt.
Beckey Cooper Baker is the Vice President of Revenue Cycle at Wellmont Health System, Kingsport, Tenn. In this position, Ms. Cooper Baker has direct responsibility for patient financial services, reimbursement, and the charge master. Having worked for several multi-facility healthcare systems during the past 30 years, she has extensive experience in healthcare finance including patient accounting, general accounting, budgeting, contract management and reimbursement. Ms. Cooper Baker has served as an author for publications regarding Medicare reimbursement products, including Medicare and Medicaid Answers Now. Wellmont Health System is a nine-hospital network serving Northeast Tennessee and Southeast Virginia.
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