Catherine Zito, FHFMA, CPA, CPC-AJoette Derricks, CMPE, CPC, CHC, CSSBG

August 2, 2012

Our focus is the Business Office◦We will not be addressing many other

important and interesting aspects of running a hospital-owned business enterprise.

◦For example, would you consider physician recruitment as a Business Office initiative?

◦What about quality initiatives?◦Physician compensation?

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Lesson #1Collaboration, Coordination &

Control Everything is related and integrated with the

Business Office functionso The Business Office must know what services the new

physician will be providing and build the charge schedule, practice management user tables, train coders/billings ideally all before the first patient is seen.

o Many quality initiatives from PMH to Physician Quarterly Reporting System to Meaningful Use are integrated with the practice management software.

o What gets captured, billed and paid will impact physician compensation.

Hospital leadership, physician partnership, practice operations, managed care contract, finance and accounting, information tech, etc. o Responsibility (role definition) o Accountability (performance expectations)

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Lesson # 1Collaboration, Coordination & Control

Two basic models1) Borrow or add on responsibilities to current hospital executivesoOn-the-job training to learn the differences between hospital and medical practice enterpriseoFrustrating unless clear definitions of roles and responsibilities 2) Hire a proven group practice administratoro Transition from one to many sites—a single to group visionoUnderstanding hospital bureaucracy and operating cultures

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Lesson #1Collaboration, Coordination & ControlWhat we learned:

o Established a management “leadership” team to set priorities and establish responsibilities and accountabilities to obtain common goals- Business Office Director, HIM Director, Practice

Administrators, Compliance, Credentialing, HR Representative, and IT Director

o Established a physician council with monthly meetings to listen to concerns and respond- Business Office Director attends and participates

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Lesson #2Physician Revenue Cycle Tools and Expertise

If you want to be successful you need to learn the rules of the physician revenue cycle

Patient data gathering and verification (front-desk)o A physician registration associate is responsible for

answering the phone, scheduling the patients, checking them in, pulling their charts, updating data, cleaning up the reception area after the sick kid, collecting co-pays, balance dues, printing fee tickets, scanning forms, etc.

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Lesson #2Physician Revenue Cycle Tools and ExpertiseDocumentation of services

o Capturing all revenue in all settings by all providers, e.g. physicians, nurses, ancillary techs- EMRs and paper forms- Auto coding or coding experts

Claim processingo Entry edits, clearinghouse edits, working outstanding

claims, patient statements, denial management, claims resubmission and appeals- 5010 format- ICD-10 is still in play

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Lesson #2Physician Revenue Cycle Tools and ExpertisePractice Management System

o Your hospital vendor may not be the best vendor for your physician enterprise

o Select one and only one practice management (PM) system that supports the revenue cycle management process

o Move all physicians/practices to a common standardized platform

o A robust EMR is also critical; however, it doesn’t have to be a product of either your hospital EMR or your PM vendor

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Lesson #2Physician Revenue Cycle Tools and Expertise

What we learned:o There are no shortcuts to the selection,

configuration and properly implemented IT systemo Dedicated IT associateso Don’t skimp on training for IT, physicians, practice

and Business Office associateso The PM and EMR systems impact clinical quality,

service, productivity, operational and financial viability of the Business Office and the entire physician enterprise

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Lesson #2Physician Revenue Cycle Tools and ExpertiseWhat we learned:

o Develop in-house when possible, or supplement with outside (outsourcing or consulting), coding and physician revenue cycle expertise- Certified coders- Physician trainers- Regulatory and compliance specialists- Managed care contracts- Billing/denial management/appeals

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Lesson #3Hospital/Physician Challenges Impact on the

Business Office Physician recruitment lead time and due diligence

o The earlier in the process you know what is coming into the Business Office the better

Standardize compensation formulao Often information needs to be added to the PM system to

capture data for the formulao Modeling the formula and refining it works better before the

physician signed on the dotted line Financial, accounting and managed care contracting

considerationso One tax ID number or separate tax ID numberso One group or multiple groups

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Lesson # 3Hospital/Physician Challenges Impact on the

Business OfficeInheriting physician staff and integrating

them into the Business Officeo New or different policies and procedureso Spouses, long-term employees requiring trainingo “That’s the way we have always done it”

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Lesson #3Hospital/Physician Challenges Impact on the

Business OfficeWhat we learned:

o Planning is a key to doing it right- Lack of adequate planning, controls resulted in many

downstream problems and issues which we are still working through

- Difficulty with always playing catch up and “issue of the day”

o Communication is key to priorities and lead timeo Don’t be afraid to let people go when they cannot

adapt to a new organizational structure

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Lesson #4What you Measure Counts!

Accurate management of data and reportingoMake sure the PM and EMR have a robust report

writing capabilityo Determine what standard reports the

physician/practice will see and wheno Ensure you understand the data

- Is the compensation based on work RVUs entered or billed or paid

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Lesson # 4What you Measure Counts!

What we learned:oWe didn’t have the right management toolsoWe suffered from a data deficiency dilemmao Physicians were use to having all the information

they wanted at their finger tipso Physicians micro-managed information especially

information that might impact their compensationoWe downloaded data into external report writing

softwareoWe worked with our vendor to fix the deficiencies

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Lesson # 5Learning is Ongoing!

The Business Office focus is on the revenue side of the equationo Improve charge capture techniques for out of office

sites, e.g. nursing homes, assisted livingo Train, train and train physician’s on documentation,

coding and billingo Train, train and train your associates on

documentation, coding and billing o Refine the receivables management system to

improve bottom line o Build a management team around good leaders with

the ability to implement best practices

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Lesson # 5Learning is Ongoing!

Use outside resources (outsource/consultants) as needed

Stay on top of regulatory changes o The Medicare Physician Fee Schedule and new CMS

changes are released in October/November for the following year

oDiagnosis coding changes are effective October 1oCPT/HCPCS changes are effective January 1o Impact of Hospital/Outpatient changes on your physicians

– 3-Day Rule for Wholly Owned or Wholly Controlled Practices

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Lesson # 5Learning is Ongoing!

Accept that while you had the hospital revenue cycle under control – the physician revenue cycle learning curve can be tough so don’t be too hard on yourself!

Relax and embrace the challenges!

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Questions???

Thank you!