1. Using the template given in exhibit 1, add one additional overall benchmark (in addition to A/R Days) and one defect benchmark for each of the revenue cycle functions listed under the Defect Metrics header. Pick your metrics from exhibit 2 (You will have to recreate the table in Microsoft Word or Excel as part of you submission - see tips at end of this document). 2. Compare the benchmark values in your completed table from question 1 with the actual MRHS metric values given in exhibit 3. Discuss your results. Most important, suggest what actions might be implemented to improve revenue cycle performance. ? You will need to create two tables here. One table to conduct the hospital variance analysis and one to conduct the clinic variance analysis- see tips at end of this document.

Andrew Mac has recently been hired as the vice president of Revenue Cycle Management for the Milwaukee Regional Health System (MRHS), an integrated system with approximately $2.5 billion in annual revenues. Located in the Milwaukee, Wisconsin, metropolitan area, MRHS consists of an academic medical center, two community hospitals, and 30 outpatient primary and specialty care clinics. Annually, the hospitals collectively see more than 40,000 admissions, approximately 100,000 emergency department visits, and nearly 1 services and care provided by the organization. encompasses the information systems, policies, and met Scheduling. Typically, this function is the first interaction between the patient and the provider million outpatient encounters, while the clinics receive more than 1.6 million visits. and insurers financial resp document the services and care provided. yulem. Hence, scheduling represents the beginning of the revenue cycle process. translate those activities to the appropriate billing amounts, issue invoices, and The vice president of Revenue Cycle Management is a newly created position at MRHS. Scheduling occurs throughout the hospital and clinic settings, emergency department and collect the correct payments. The fireanus cycl mar fort process also walk-in patients require unique scheduling procedures. In that role, Andrew will oversee the merger of the currently separate hospital and physician includes the evaluation of re hewas due for services provided; and the continuous raw I and audiing funcions to * Patient information gathering begins with the description of the health issuecare mood revenue cycle departments. Andrew has been directed by MRHS's CEO to accomplish two amsure that all actions are in compliance with MRHS's hundreds of third-party and type of insurance coverage peryer contracts. . Examples of potential defects during the execution of this function include directing primary goals: (1) lower the overall costs of revenue cycle management and (2) improve the The following achamatic presa in overview of a typical provider patients in the wrong service and failing to properly identify and verify insurance revenue cycle process. (For more information on revenue cycle management, see the Healthcare revenue cycle man s described by the Medical Group coverage and obtain precertification (if required). Management Association. It is followed by a brief description of each function Vegiswallow. This is the first patient experience on the first day of each patient encounter. Financial Management Association website at www.htma.org or the Medical Group and the information gathered within the function, bag ginning with scheduling. Registration occurs throughout the bropital and clinic sellings. which typically begins the re potential delects frat Management Association website at www.mgma.com. Search the term revenue cycle at both Patient information gathered in the scheduling process is confirmed or updated, and can goour with erstand that additional health condition an websites.) immediate identification and com Tical to good revenue e information is obtained if needed. cycle parformance bec cks, require raprocessing. . Examples of potential defects the execution of this function include misidentifying Andrew understands that the first step in merging MRHS's separate revenue cycle result in poor patient ex realizable values" patient adlar insurer information and filling to verify coverage and precertification (if required) departments is to alter the current perception that hospital and physician practice revenue cycles Case sunagewear. With this function, the translation of medically necessary healthcare services Scheduling are inherently different. His goal in this regard is to illustrate the similarities and to charges for those services begins. Eligibility Cine minagement occurs throughout the hospital and clinic settings, with in emphasis am interdependencies among the revenue cycle processes to highlight what he believes to be the true hospital inpatient adm * Patients' medical history and documer hitus and care plan are reviewed. determinants of revenue cycle success: (1) the collective hospital, physician, and revenue cycle Examples of potential defects during the execution of this function include ordering staffs' effort to limit defects in the process and (2) the ability to identify, bill, and collect the 1. Rate Complexity and or performing services that are not preauthorized or are deemed medically correct net realizable value of each encounter. When asked about these statements, he explained unnecessary by the insurer. Canfowl charge processing. Hare, the clinical documentation of services provided is translated to that defects can be thought of as problems that impede the revenue cycle process, and net line-item charges. Code Editul realizable value is the actual dollar amount expected to be collected from both patient and insurer Clinical charge processing, which apples to hospital and clink services, uses diagnosis- related group (DRG) and revenue codes for hospital billing and Current Procedural for each service provided. To begin the effort, Andrew prepared an orientation presentation for hospital and physician leadership on the integrated revenue cycle management process. Following is part of that presentation: The revenue cycle management process in healthcare provider organizations represents the process of identifying and securing the financial integrity of allor cach Terminology (CPT) and Healthcare Common Procedure Coding System cades for 1. Establish * Unpaid balances due from patients undergo another round of processing, including outpatient and physician billing weinch to find adidticeal imam racial statin information. revenue cycle function, from ag The metrics should be e definitions and current services and the level of care provided is matched to the charge * Examples of potential deffer ation of this function include mishandling Metric benchmark values. Andrew h he provided you with a description master (chargemaster) file. of insurer payment de state the remaining outstanding balance Metric Definition template, as shown in exhibit I, that accounts Examples of potential defect s during the execution of this function include charges from patients, and patients' noicing and coverage. receivable [A/R) days-that is already filled in he finished compiling a list Overall Metrics Not patient accounts 48:3 days 28:5 days submitted after the allowed documentation period (late charges) and improper matching Newvive recovery. This andit function takes ontimeously to examine the entire revenue of clinical entries with the cycle process. The following steps in of metric candidates and benchmar hich is provided in coovery. bent service fradical racerah. This function cursists of the systematic compilation and documentation off all . Measure the performance off each revenue cycle function according to catablished exhibit 2. Thus.sun metric and /35.drill the single haatd are provided to patients during and, f appropriate, subsequent to the encounter. benchmarks. hath the hasnital A single patient pecard for all services is created. . Identify the came off each defect and take co mective action as necessary. t dcal of discussion of Scheduling cered is available to patients and other care providers, subject to these metrics al the meeting. that you fully justify your selection # Ersure compliance with regulatory reg and confirm that payments received ration certain regulations including the advantages and d are consistent with all insurer nization's charity care Manager Esamples of potential defo is during the execution of this function inclarke 2. Compare the MRHS actual values for the metrics chosen, provided in exhibit 3, with the Clinical charge documentation and coding emers and lag times in the coding and compiling of the record benchmark values. Discuss the implicit mparisums and, most important, . Defects that can nocar in this farat metrics and'or valves and failure to aggressively audit andfor correct defects in the wapgest the corrective actions that should be implemented to bring MRHS in line with (discharged but not billed) Medical second Willing. This function converts the information gathered in previous functions to patient and national standards for the areas of subper performance. revenue cycle. Bling Insurer bills (invokes) The tempitl and physician leaders found Andrew's presentation to be a valuable Payment posting In the billing faratiom, Centers for Medicare & Medicaid Services (CMS) UB-04 Samms overview of the seven and over the merging of (for hospital impatient and outpatient insurance billing) and CMS 1500 forms [for the two revenue cycle departm en to monitor performance. In physician insurance billing) are prepared. addition, they expressed of defects and the ways to * Given the highly technical sure of the UB-04 and CMS 1500 forms, separate billing identify and correct them. To an excument that statements are created for p ment responsibilities. includes both hospital and c Note that all metric and * Examples of potential deb cution of this function include a lack of values provided in this d not be used for other timely bill submins me to follow the specific billing rules required by the purposes awarer, which results in payment denials. The meat meeting with hospital and physician leadership is scheduled in two weeks, and Payment pouring. In this function, the accounts peorivable entry is adjusted as invoices are Andrew had planned to complete the project b .he broke his leg in a collected. Note that this process may require a coordinated effort of follow-up and collections is urable in get the actions directed at the inamer ard'or patient. work done in time for the meeting. Thes, he has asked you, an admis rative fellow at MECHS, Exhibit 2: Selected National Benchmark Data Payment pasting is complicated by the mimay different rules, regulations, and data fromtats to help out with the following two tasks Exhibit 1: Benchmarking Template nogunned by private and govMRHS Hospitals MRHS Clinics Overall Metrics A/R days 45.4 days 26.3 days % of A/R greater than 90 days 21.5% 20.1% Cost to collect 2.9% 4.5% Defect Metrics Scheduling Preregistration rate 80.89% 99.9% Insurance verification rate 85.3% 100.0% Coding quality sours 10 2% Registration Point-of-service collection rate 8.7% 48.5% Registration quality score 91.6% 99.9%% Case management Proauthorization denial rate 2.4% 0.3% Percent of medical necessity write-offs 0.7% 0.29 Clinical charge processing Whenand set patent mono206 days Charge lag days 3.2 days 6.8 days Late charge percent 2.1% 86.9% Medical records Days in total discharged not final billed 4.5 days 7.5 days Coding quality score DB.7% 90.2% ameters tided Billing Initial denial rate 5.6% 7.8% Exhibit 3: Selected MRHS Metric Values Clean claim rate 72.4% 85.2% Exhibit 2: Selected National Beachmark Data (cantinaed) Payment posting Percent of payments posted electronically 90.1% 78.9% Net days revenue in credit balance 2.5 days 2.3 daysConsider using a table like this for answering question 1: Hospital Clinic Metric Category Metric Metric Definition Benchmark Benchmark Net patient accounts Overall Revenue A/R Days receivable / (Annual 48.3 Days 28.5 Days Cycle Metrics patient service/365 days) Defect Metrics Scheduling Registration Case Management Clinical Charge Processing Medical Records Billing Payment Posting Consider using a table like this for answering question 2. Metric Hospital Value* Benchmark Value Variance# A/R Days 45.4 days 48.3 days 2.9 days better than benchmark Remember you need to create 2 separate tables - 1 to conduct hospital variance analysis and I to conduct clinic variance analysis #For Variance column use green font color for "good" variances and red font color for "bad" variances