Volume IX Number 1

January 2003
 

The Newsletter of

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Vital Signs

[Editorís Note: The following is a press release issued on January 9, 2003, by DEKAYE Consulting, Inc., based on its PFS Power Rankingssm system.]

HOSPITAL PATIENT FINANCIAL SERVICES (PFS) DEPARTMENTS PERFORMANCE STAGNATES

DEKAYE Consulting, Inc., a Long Island, New York, consulting firm, released its latest PFS Power Rankings(sm) summary data that measures hospital Patient Financial Services departmentsí performance. The national ranking average for December scoring (for November 2002 data) is 17.2, which is a precipitous drop from last monthís 18.7 Hospitals appeared to have stagnated with regards to overall cash collections, and efforts to reduce accounts receivable (A/R).

Company President and CEO, Allan P. DeKaye, MBA, FHFMA, indicated that, "In the "Strength" categories hospitals averaged only about 8 out of a maximum 14 points." The "Strength" category specifically addresses meeting cash collection goals and lowering inpatient and outpatient A/R. He went on to add that, "In each of the other categories such as "Consistency," "Production," and "Detractors" hospitals had off-setting pluses and minuses further impeding their monthly scores from increasing." Since hospitals are already beginning to enter their January 2003 scores (for December 2002 data), calendar year end performance will be determined very quickly.

The monthly Power Rankings are based on participating hospitals responding to a 14 question on-line survey that requires them to answer YES or NO to a series of performance based inquiries. The questions measure cash flow cycle operational sequences in terms of "Strength, Quality, Consistency, Production and Detractors." Hospital data is ranked, but individual identities are not shown. A perfect score would be a monthly rating of "30." So far, the Historical National Average is 17.6. Rankings are instantaneously determined when the survey is completed, but monthly rankings can change within the month as each hospital enters its data.

PFS Power Rankings also presents the data by region and bed size categories. According to Mr. DeKaye, "This month produced an unusual clustering in the "16" range, as evidenced by the scores for the North Central and Northeast regions, as well as for hospitals in the 0-250 and 251-650 bed size categories. Subscribers also receive a more detailed analysis, and access to "Bulletin Board" postings related to the scores.

Mr. DeKaye, whose national consulting practice focuses on hospitals, physicians, other healthcare providers and corporations, is the author of The Patient Accounts Management Handbook. In addition to hospitals, Billing Companies, Collection Agencies, Consulting and Accounting Firms, Financial Institutions, and others interested in industry trends will benefit by subscribing.

For more information, and to join PFS Power Rankings visit their web site at: www.pfspowerrank.com, email to: pfspowerrank@aol.com, or call (516) 678-2754.

Perspectives and Commentary

Learning Lessons

By Allan P. DeKaye, MBA, FHFMA, President and CEO, DEKAYE Consulting, Inc.

For many providers, the beginning of the New Year signifies a time to "get things off to a good start." Over the years, I recollect the comments made by others (such as: "The harder I work, the further behind I fall," and "Itís the same problems we faced several years ago," etc.) that suggest an inevitable sense of "acceptance of conditions" rather than "accepting the challenge" of changing the past.

Yet somehow we marvel when an exceptional month (e.g., cash collections or A/R reductions) occurs, only to return to a more mediocre level the following month. As a result of this "human condition," several concepts will be discussed to try to alter the "human psyche."

Intensity (I) - the observable behavioral change among staff that occurs when supervisors "supervise," and managers "manage." [Supervisors and managers attain this characteristic when directors "direct."]

Consistency (C) - the condition that results when "intensity" is achieved.

Sustained Production Capability (SPC) - the combination of Intensity and Consistency. The results are arithmetic when these elements are additive, and geometric when there is a multiplier effect.

Coefficient of Productivity (COP) - is the measurement of the SPC over time.

How to Measure and Achieve

The next logical question would be, "how do you translate these concepts into measurements?" The following is suggested.

While intensity (I) may be an observable phenomenon (my criteria is "hearing the sound of work"), a more definitive measure would be achieving a reduction in the number of open accounts (both for inpatient and outpatient) open accounts receivable (A/R).

For consistency (C), a good proxy would be the ability to achieve goals in consecutive months. Goals such as meeting cash collection projections and A/R dollar reductions would be good examples.

The SPC could best be measured by a combination of A/R reductions in dollars, accounts and days. The COP measure would be your evaluation of performance over time. If conceptually, you concur with the "theory," then you should try to put these ideas into "practice."

[Editorís Note: See related article on PFS Power Rankings, and visit www.pfspowerrank.com to see how you can apply the above noted theories in "real time" practice.]

: Ask The Expert

by Allan P. DeKaye, MBA, FHFMA

Q:  We are having problems with our COB relative to contracted vs. non-contracted payers.  Any suggestions?

A: While situations will vary, you should distinguish problems you are having with contracted vs. non-contracted payers.

You should find that you have more leverage with contracted payers, and should seek out meetings with claim representatives. The same approach is suggested with non-participating plans--although they may be less accommodating in meeting with you. You should check to see if your state has some form of prompt payment legislation that may afford you some protection (although, at best, it gives you a basis to complain and cite the law as a basis for your concern and remedy). If the state provides some other administrative relief, determine what you need to do to further your position.

 

     Conversations with Colleagues

Compliance Concerns Continue

For this issue, weíve asked one of our colleagues to share their thoughts on related industry matters. We asked:

Mr. Gregory J. Naclerio, Esq.
Co-Chair Health Care Department
Ruskin Moscou Faltischek, P.C.
Uniondale, NY

to offer his comments on important compliance concerns facing the industry.

On Target (OT): What was the most significant industry accomplishment for this area in 2002?

Gregg Naclerio (GN): The No Fault carriers finally recognized that they were the victims of fraud. Once awakened from their slumber, they commenced civil lawsuits and exerted pressure on local District Attorneys to ferret out No Fault fraud. More to follow in 2003.

OT: What will be the most difficult challenge facing this area in 2003?

GN: Compliance Officers will continue to face pressure from the "sign off" on questionable deals because the hospital needs ... "the money, the patients, etc."

Compliance Officers need to hold strong to their guns because the Government is getting more and more aggressive.

The Government in 2003 will seek to push the False Claims Act into new and uncharted territory. When hospitals face claims of treble damages of $5-$10,000 per claim, careful review of "Get Rich Quick" schemes by the Compliance Officers will yield significant returns.


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