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Achieving Revenue Cycle Excellence To Prepare for Health Reform

Jim Morrison, VP and General Manager Revenue Cycle Solutions, McKesson

Agenda
Healthcare Reform: The Environment Provider Impact Enhancing Payer Relations Reimbursement Management Driving out Cost Case Studies in High Performance Summary and Q/A

Healthcare Reform: The Environment


Healthcare reform legislation set things moving.

The next steps are less clear

Audience Survey
Which of the areas listed below is your organization most prepared to address? A. Accountable care/shared savings strategy

B. Value-based purchasing
C. Readmissions and hospital-acquired conditions

D. Bundled payments
E. Strategy to address newly insured patient populations
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HFMA ANI 2011 Conference Survey


Please indicate your organizations preparedness to address the areas listed below.
Percent Indicating "Very Prepared" To Address Readmissions and hospital-acquired conditions Value-based purchasing 12% 16%

Strategy to address newly insured patient populations


Accountable care/shared savings strategy Bundled payments 1%

6%
6%

Sample size = 84

Four Building Blocks of ACOs


Connectivity, Engagement, Medical Home

Analytics

Actively engage patients in their care process Provide patients with access to their pertinent information Enable care coordination and connectivity Enable a range of personal health management and health information tools

Stratify populations for management. Identity opportunities to manage cost and quality Report and act up care gaps Understand and optimize provider performance Support internal/external reporting demands

Care Management

Payment Mechanics

Leverage evidence based decisions in delivering programmatic care Support integrated/holistic approach to managing patients across the continuum of care Support integrated workflow in managing cost/quality

Manage multiple payment models at the POC including traditional FFS Leverage analytics to define/ support care bundles and prepare for bundled payments Tools to manage contracts and payment distribution logic

PCMH

ACO
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ACO Strategic Competencies


Connectivity, Engagement, Medical Home
Connectivity Interoperability Data Exchange Care Coordination Communication Messaging Notifications Results Referrals / Orders Engagement PHR Multi Modal Comm. Education Online Programs Decision Support Marketing Transformational Services

Analytics
Performance Analytics Operational Efficiency Service Line Analysis Cost Trend
Population Analytics ID & Stratification Care Gaps Intervention Outreach

Network Analytics Cost & Quality PMPM Spend Efficiency Profiles Attribution Logic Benchmarking Incentive Modeling Outcomes Reporting HEDIS. NQF, PQRI, IQR

Care Management
Holistic Management UM / DM / CM ID & Stratification Medical Necessity Decision Support Readmission Mgmt. EBM Assessments Care Plans Care Guidelines Education Campaign Mgmt

Payment Mechanics
Financial Management Payment Mechanics Eligibility Contract Repository Medical Necessity Medical Policy Auto-authorization Payment Policy Distribution Logic

PCMH

ACO
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Bundled Payment
Required Capabilities
Clinical & Claims Data

Episode Registration

Evidenced-Based Guidelines

Analytics Engine

Efficiency Profiles Distribution Logic

Care Management Tools

Bundles Payments
Success Requirements
Analytics Operational analytics to identify service line opportunities Network analytics to determine and track provider efficiency in support of bundled contracts Analytics to track associated claims activity Advanced Tools
Utilization management tools to reduce variation in resources supporting bundled payment Integrated analysis of operational & network performance against contracts Care management tools to ensure integrity of bundle Tools to register and trigger bundle Payment distribution logic
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Healthcare Reform
Whats Next?
The world will include a mixed environment: Capitation/fee for service, risk sharing The world will be a heterogeneous one: Medical homes, legacy systems and significant investments, clinics, labs, doctors offices, unique payer relationships, unique employer relationships, consumer driven healthcare, regulatory reform, analytics to drive down cost, population management, increased demands and shrinking reimbursement all coming by 2014
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Healthcare Reform
Whats Next?
Population Management Analytics supporting the ID and risk-adjusted stratification of a population of patients Integrated analysis of clinical and claims data Tools to intervene to address gaps in care Reporting tools to define and report on metrics Profiling tools to assess provider efficiency and optimize performance Changes in Care Settings Hospitals expanding footprint to non-traditional settings Connectivity between all care settings clinical & financial is essential

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Agenda
Healthcare Reform: The Environment Provider Impact Enhancing Payer Relations Reimbursement Management Driving out Cost Case Studies in High Performance Summary and Q/A

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Provider Impact
The Changing Landscape
Reduced Reimbursement Fee-for-service payments cut Commercial payers driving to Medicare levels Payment Reform & Evolution Pay for performance Bundled payments Capitation Shared savings
ICD-10 Transition

Quality Improvement Pay for performance Public reporting measures Meaningful use Enterprise care management

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Agenda
Healthcare Reform: The Environment Provider Impact Enhancing Payer Relations Reimbursement Management Driving out Cost Case Studies in High Performance Summary and Q/A

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Audience Survey
Are you talking with any of your payers about how the health reform changes will affect your relationship?

A. Yes, were meeting regularly


B. Yes, were in the early stages of discussion C. No, but we have plans to meet D. No, with no plans to meet

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Enhancing Payer Relations


Collaboration & Information Sharing
Holistic view of the patient Match clinical & claims data Reduce administrative costs with automation Regular educational updates from payers

5010 & ICD-10 Transition Advantages

5010 allows more information sharing between provider and payer Cleaner claims results in fewer denials Collaborate with your payers on contract reviews prior to ICD-10 transition

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Agenda
Healthcare Reform: The Environment Provider Impact Enhancing Payer Relations Reimbursement Management Driving out Cost Case Studies in High Performance Summary and Q/A

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Reimbursement Management Complexities and Mechanics


Provider-based Physicians Single source to track and manage patients Historical view of payments Contracting and Understanding Cost

Medicare 72-hour window Underpayment management

Disparate information management systems


Acute and Ambulatory billing integration Case Management/Length of stay control

Analytics to understand performance


Cost of care, quality of care, spend per-member per-patient Provider efficiency Benchmarking & Incentive Modeling Reporting to regulatory bodies
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Agenda
Healthcare Reform: The Environment Provider Impact Enhancing Payer Relations Reimbursement Management Driving out Cost Case Studies in High Performance Summary and Q/A

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Driving Out Costs


Strategies and Opportunities
Big focus on clinical IT comes from ARRA

Strengthen your revenue cycle processes by using your IT system to the full extent

Process flow improvements Organizational changes and improvements Technology plan to improve results

Optimize to drive to the best practice for each area Reduce total cost of ownership for IT
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Audience Survey
What process do you use today to confirm patient identity?

A. Photo ID
B. Photo ID and insurance card C. Biometrics D. Other

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Driving Out Costs


Patient Identification Management
Medical Identity Theft is one of the fastest growing crimes in the U.S. An estimated 1.4 million adults, approximately 5.8% of the U.S population, were victims of medical identity theft in 2009. Biometrics identity confirmation can ensure the right patient receives the right care

22 * According to the National Survey on Medical Identity Theft prepared by Ponemon Institute in 2010

Agenda
Healthcare Reform: The Environment Provider Impact Enhancing Payer Relations Reimbursement Management Driving out Cost Case Studies in High Performance Summary and Q/A

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Audience Survey
What are your current net accounts receivable days?
A. 40 days B. 41 45 days C. 46 50 days D. 51 55 days

E. 56 days

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Case Study
Mississippi Baptist Health System
Staff education on IT and processes HIS table updates to align with best practices

Process improvement for point of service collections


Key Statistics and Accomplishments Net Cash collection increase of $10,237,193 Denial write-offs decreased by 45% Point of Service cash collections increased by 15% A/R days decreased from 36 to 34 (well below HFMA target) Failed claims decreased by 24% Adjustments decreased by 1.37%

Staff HIS education test results improved from 59% to 87%


550 licensed beds. Project statistics run from November 2009 - December 2010.
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Audience Survey
What is your average time for patient registration to be completed? A. 10 minutes B. 11-15 minutes

C. 16 minutes

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Case Study Spartanburg Regional Medical Center


Streamlined insurance master tables
Established electronic remittance advice for each payer

Standardized graphical user interface for registration staff


Key Statistics and Accomplishments Decreased A/R days by 8 days Record breaking cash collections more than $30M Reduced unbilled accounts from $58 million to $30 million Reduced failed claims by $6M Increased admission speed 30% and improved admissions accuracy 50% Three facilities included: Spartanburg Hospital: 568 licensed beds; Village Hospital: 48 licensed beds; Restorative Care: 84 licensed beds
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Agenda
Healthcare Reform: The Environment Provider Impact Enhancing Payer Relations Reimbursement Management Driving out Cost Case Studies in High Performance Summary and Q/A

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Whats Next?
Managing Populations and Risk Under Health Reform
Connectivity & Engagement

Care Management

Interoperability with identity Cross-continuum, patient management centric care plan Care Management Patient communication Financial Management Quality and Evidence Connectivity & Aggregation Analytics / DataEngagement Engagement Model Holistic disease management
Cross-continuum, patient Eligibility Interoperability with identity Performance evaluation Payment mechanics management Population analysis Quality and Evidence Disbursement Management Patient communication Network analysis Holistic disease Engagement Model Outcomes reporting Financial Management Analytics / Data Aggregation management

centric care plan

Performance evaluation Population analysis Network analysis Outcomes reporting

Eligibility Payment mechanics Disbursement Management

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Whats Next?
Managing Populations and Risk Under Health Reform
Connectivity & Engagement Care Management

Interoperability with identity management Patient communication Engagement Model

Cross-continuum, patient centric care plan Quality and Evidence Holistic disease management

Analytics / Data Aggregation Performance evaluation Population analysis Network analysis Outcomes reporting

Financial Management Eligibility Payment mechanics Disbursement Management

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Extra Resources
sites.mckesson.com/AchieveHIT/reform.asp

More Information on Revenue Cycle Management

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Questions

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