Allina Revamps Revenue Cycle, Cuts Costs
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Client:
Allina Hospitals & Clinics
Challenge:
Improve the organization's revenue cycle, which sometimes faced delays and payment denials.
Solution:
CSC redefined job roles, redesigned processes and, ultimately, reduced headcount.
Results:
An improved revenue cycle and cost savings of millions of dollars.
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Next to patient care, revenue cycle is one of the most important processes for healthcare organizations. The path from scheduling a patient to getting paid for those services is a long, complex one. It includes many front-and back-office processes, numerous staff members and sometimes months of delays.
With dozens of facilities throughout Minnesota and Wisconsin, Allina Hospitals & Clinics was facing challenges with their revenue cycle and its effect on their bottom line.
In 2004, a team from CSC's Global Health Solutions began working closely with Allina to look for ways to improve their revenue cycle. CSC redefined job roles, redesigned processes and, ultimately, reduced headcount and saved Allina millions of dollars.
Technology + process = success
Allina began an ambitious implementation of an electronic medical record system, called Excellian, in 2004. Allina realized that this was an opportune time to revamp its revenue cycle processes and personnel. Both would directly interface with the new system.
"We knew that implementing something like this was probably more about the business and clinical process redesign than it was about simply plugging in the software and turning it on," says Kim Pederson, vice president of Allina's Excellian project.
"When we registered and scheduled a patient, we needed to ensure that we had all their information accurately, that we had everything we needed to get paid properly. We knew that we had to redesign the way our front end revenue cycle processes worked."
CSC's revenue cycle solution is process-driven because clients use many different products, explains Bruce Hallowell, CSC's solution director for Revenue Cycle.
"We're one of the few companies that link technology to process," he says. "We don't try to sell them new technology — we try to optimize what they have, as in the case with Allina. We look at technology as a tool, but process is what makes the tool work."
Accuracy is crucial
A good revenue cycle hinges on accurate patient and insurance information. Without it, an organization can lose millions of dollars in denied payments.
Almost immediately, the CSC team at Allina identified more than $15 million that could be saved by focusing on three main payment-denial reasons: - No pre-authorization
- Missed filing deadlines
- Lack of appropriate physician referrals
The team also identified payment problems linked to faulty insurance verification, such as incorrect or missing policy and group numbers. On the personnel side, CSC examined all job roles and processes on the front end. The team discovered a lot of people doing a lot of different jobs.
"Historically at Allina, they had insurance verifiers, pre-registrars, financial counselors – all these separate functions that ultimately did the registration work. We proposed to create one position that did it all prior to the patient's arrival," says Seong Haid, CSC senior business process specialist, noting that reducing headcount was not the only driver.
"It's also about accountability. By creating that skill set in one individual, who is able to interpret the insurance requirements, work with the patient and complete a full registration from start to finish, that person becomes accountable for the accuracy of that account. This type of process and results accountability strengthens management's control over data quality and allows them to target specific training needs."
Better processes, reduced headcount, increased savings
CSC also proposed collecting patient co-pays and deductibles up front, which was not always done previously. In addition, CSC focused on data quality, putting into place new guidelines for collecting and verifying information. These included having the guarantor always verify the spelling of names and insurance policy information, rather than assuming the information in the system was already correct.
"If the registration is accurate on the front end, it really does reduce the FTEs [full-time employees] on the back end by reducing the amount of follow-up and rebilling that are required to rework the denials," Haid notes, adding that collecting patient payments upfront also added to Allina's bottom line. "There are fewer customer service calls, and you don't have to send patient balance statements because you've already collected that money."
From 2004 to 2006, CSC worked with Allina to implement these process changes across Allina's facilities. This occurred in conjunction with Allina's rollout of the new electronic medical record system. Together, the new software and processes are producing promising results.
"I'm very satisfied with the work," says Pederson. She noted that Allina's original goals are being met six to 12 months after each hospital is fully implemented. "We knew that redesigning our front-end revenue cycle processes would allow us to avoid denials, increase cash flow and decrease operating costs. In hospitals that are fully implemented, those things are happening."
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