New England Hospital Sees Benefits From Improved Billing Process
Kunde: 300-Bed Community Hospital in New England
Herausforderung: Diagnose and fix problems with the hospital's operating room revenue cycle process, including correcting deficiencies in the billing system and supply accounting.
Lösung: Implement changes to the revenue cycle by improving links between supplies and invoicing. Transform the billing process, with a focus on improving invoicing for commonly used supplies and negotiating more favorable supply contracts.
Ergebnisse: Increased accuracy in invoicing and a more streamlined billing process, resulting in higher revenues and more efficient operations.
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Modern hospitals are using information technology, advanced medical procedures and the latest surgical equipment to transform healthcare. But with these advances, invoicing patients for operating room procedures has become much more complex. CSC worked with a 300-bed community hospital in New England to improve its billing process, which has resulted in more accurate invoices and increased revenue.
An efficient revenue cycle — which includes scheduling, billing and managing supplies — is essential to the operational success of any hospital. The hospital's leadership worked closely with CSC to diagnose where the operating room revenue cycle was deficient and what needed to be changed. This review concluded that the hospital should make improvements in a number of areas, including charge coding, materials management and supply contracts. CSC's team, bolstered by its experience in healthcare systems management, successfully transformed the hospital's billing process as part of a multifaceted program that has led to significant operational improvements at the hospital.
Increased accuracy, improved efficiency
The use of advanced technology, for all its benefits, can still lead to billing errors at times. CSC's diagnosis of the hospital's revenue cycle identified a large amount of unrecognized revenue in the surgical services department. Barb Ripollone, a CSC Consulting principal and engagement manager who brought more than 30 years of hospital administration experience to the project, describes the task at hand. "When you're in operating rooms now, they are so high-tech that the supplies are very expensive," she says. "What happens is that the advanced complexity can hold up an entire hospital bill from being processed and getting paid."
Ripollone says, "The hospital's leadership became aware of a significant shortfall in what they expected in revenue and it was in the charging of some of their high-cost specialty items." For example, some patients that underwent multiple operating procedures were getting billed for only one procedure. In addition, patient bills lacked detailed descriptions of the procedures performed, making it difficult to accurately track and manage specific vendor and supply costs.
With CSC's help, the hospital was able to improve the links between the supply system and the billing system. With the new processes in place, the supplies associated with operating room procedures are now accounted for more accurately. For example, in the updated system, vendors now provide inventory lists that are imported electronically into the materials management module. This has resulted in a number of improvements; for one, the system adjusts more quickly to changes in unit prices. In addition, CSC was able to help the hospital develop a standardized nomenclature that has resulted in more accurate billing for operating room procedures and improved supply chain management.
More specifically, CSC helped the hospital improve the process that was being used to invoice patients for high-ticket and miscellaneous charges such as spinal implants. CSC advised the hospital's leadership that most hospital operating rooms use relatively few miscellaneous charges, and helped them build common charges and supply items into the existing accounting system. At the same time, the more accurate accounting of supplies allowed CSC to work with the hospital to negotiate more favorable contract terms with the hospital's supply vendors.
Best practices produce results
As is typical of CSC healthcare engagements, standardized processes were put into place to facilitate the improvements. In addition to setting up new billing processes, CSC established performance measures and evaluation systems to assess the hospital's staffing and job skills, and optimized the hospital's organizational alignment and accountability. A key factor in the success of the program was the establishment of a feedback mechanism where physicians and staff could communicate freely with hospital leadership and CSC.
Ripollone says CSC augmented and mentored the hospital's operating room team by bringing industry best practices into the implementation. "It was a good old-fashioned hard-working engagement," she says. "We would anticipate the problem — and indeed find the problem — and then work closely with them to come up with a solution." In addition to the operating room revenue cycle improvements, CSC has provided support services for the hospital on a number of other projects, including an inventory redesign and a major transformation of the hospital's supply chain.