Large Health System Relies on CTG to Get Its Revenue Cycle Back on Track Post-EHR Implementation
CTG’s client is a large health system located in the Northeastern United States, which includes a 600+ bed acute care hospital, skilled nursing unit, and an inpatient rehab unit. The organization has more than 1,000 physicians and providers across more than 40 locations and offers comprehensive care ranging from preventative screenings and education to the latest clinical services and treatments.
Challenges and Objectives
Healthcare organizations across the U.S. and in Europe have discovered that most electronic health record (EHR) implementations are disruptive, at best. However, when they include revenue cycle and access, their impact cannot be overlooked. Poor planning and training during implementation can result in significant financial impacts. In today’s climate of declining reimbursement and increasing regulations, healthcare organizations cannot afford to miss any opportunity to optimize their revenue cycle.
Our client’s EHR installation resulted in significant revenue cycle impact for the organization, including ballooning work queue requests to IT for support of the new EHR, billing delays, and accounts receivable (A/R) ($200 million) and outstanding claims ($98 million) that were significantly above normal levels. Senior leadership partnered with CTG to identify the root cause of the A/R issues and create an actionable recovery plan, process, and timeline that would quickly produce maximum effectiveness while minimizing organizational disruption.
CTG worked with the organization’s leadership to identify and assemble a team of application operations and build experts to staff the initial assessment and remediation planning project. CTG’s project team then worked closely with IT systems staff to:
- Investigate the EHR build structure and related process and workflows;
- Conduct organization interviews to determine existing roles and responsibilities, draw out individual views of the causes for the increased IT work queue requests, help clarify root causes of the issues at hand, and identify the channels of communication between the groups (including any noted communication breakdowns);
- Identify the sources for any EHR operation breakdowns by observing individual staff members using the system to determine if the EHR’s full capabilities were being utilized, and noting observed discrepancies and areas for improvement;
- Complete detailed revenue cycle department assessments to determine how financial components interacted with the EHR to better understand the operational environment, further clarify major problems, and identify root causes; and
- Evaluate IT work queue requests related to the EHR to categorize and quantify the types of issues being reported.
Throughout the project, CTG worked closely with leadership and staff members to address errors upon discovery, when possible, and develop remediation recommendations for issues requiring more time and attention.
CTG developed a full report of findings and recommendations covering all revenue cycle departments, Patient Access, and Health Connect. The report identified that measurable EHR A/R metrics, measured against both routine health information systems (RHIS) baselines and national benchmarks, were significantly underperforming in total A/R; A/R days; outstanding claims; unresolved denials; and other areas. Significant findings from the assessment activities included:
- Build and process errors had resulted in $3.8 million of undistributed cash;
- The cash department was not balancing against deposit information from the finance team; and
- $12.9 million was discovered in unresolved denials and $11 million in claim edits holding accounts from billing to payers.
Based on these assessment findings, CTG worked closely with client leadership and team members to plan and conduct remediation efforts. The following improvements have been recognized as a result of these remediation efforts:
- Bill time decreased from nine days to the industry standard of three to five days
- Claim edits decreased from 37 days to the industry standard of three days
- ePremis claims decreased from $41 million to less than $300,000
- Staffing levels were optimized based on refinements in the EHR system and related workflows
- 349 build-related issues were identified, holding more than $107 million from billing to insurance
- Weekly reviews/resolution of all open build-related tickets with patient financial systems (PFS) and IT Department were put in place
- Productivity tracking and reporting processes were created
- Work standards for all processes were created and all staff retrained to these new processes
- Electronic processing for billing and attachments for workers’ compensation and motor vehicle accident (MVA) claims was implemented, reducing billing time from 14 days to two days
- Days outstanding for A/R were reduced from 56.2 days to 45 days, a reduction of $61.6 million in A/R.
- Daily cash collections increased from $1.8 million to $2.2 million
- 91 days plus A/R aging was decreased by $25 million
- 31 days to 90 days A/R aging was decreased by $26 million
- PFS-related discharged/not billed (DNBs) and stop bills were reduced from $4.3 million to $765,000
- Unbilled late charges were decreased from $3.5 million to $683,000
Additionally, CTG staff members were brought in as frontline users to clean up backlogs and reduce candidate for bill (CFB) and A/R days outstanding. In six months, they accomplished the following:
- Resolved $6.9 million in insurance no-response claims
- Appealed $5.4 million in insurance denials
- Resolved $306.1 million in claim edits
- Posted $22.6 million of undistributed cash
- Corrected $1.9 million in contractual adjustments
CTG’s analysis and close collaboration with the client resulted in multi-million dollar savings, billing process enhancements, and improvements in A/R metrics that touched virtually every aspect of the revenue cycle in a positive way.