DeKaye Consulting, Inc. Volume II Number 1

April 1996

The Newsletter of

DEKAYE Consulting, Inc.

231 Oakview Avenue
Oceanside, New York 11572
Phone / Fax: (516) 678-2754
E-Mail: ADKCMPA@AOL.COM

On Target

Spring Break

Vital Signs

Goal: Lower Your Days to Bill !

Whether we examine inpatient or outpatient service areas, there are several components to the "Days to Bill" key indicator that need to be watched. These elements include:

Obtain proof of identity and address: making sure you have the right spelling and address of both the guarantor, as well as the patient (whether they are one in the same or different) is essential to avoid unidentified subscribers and return mail; pre-admission programs and use of HIS systems are important resources.

Identify and verify both primary and secondary insurances: this ensures that there is an insurer to bill; electronic eligibility systems and/or "point of service" terminals connected to payors should be used; this should be done during the pre-admission or at admission or registration at the latest.

Collect deposits for deductibles and copayments: this reduces the number of self-pay bills and outstanding A/R, as well as secondary billing delays; credit card payments should be encouraged along with other forms of payments or bank loans;

Ensure timely and complete charge capture: Use of late charge reports and periodic "chart-to-bill" audits help keep this number from interfering with the billing process; order entry and laboratory information systems will help in this area.

Code diagnosis, procedures and services accurately and timely: for inpatient services; coding should be complete at three days after discharge; for outpatients, and the generally larger volume that must be accommodated, we suggest that anyone in the 6-8+ days from service date strive for the 3-5 day range; it might be necessary to outsource outpatient volumes in order to meet lower levels of processing time.

Your hospital information system (HIS) may already give you an average "days to bill" value. If not, try sampling 50-100 cases and calculate the difference from the bill date and the discharge or service date. Sum up all of the values and divide by the number of cases in the study. The lower the number, the better you're doing. "How long can you go?" Two (2) for inpatient, three (3) for outpatient and you should be in fine shape.

Next Issue: "Days to Collect."

MSO: FRIEND or FOE ?

The Air Force has a name for it: IFF - "identify friend or foe!" In today's ever-changing healthcare landscape, we might apply the same warning message to hospitals and physicians who are contemplating formulating MSOs -- management services organizations. The basic MSO concept is founded on sound principles of achieving economies of scale and enabling physicians who join a hospital network to eliminate many of the time-consuming, administrative tasks (e.g. billing and collection) that they had to address in their private practice setting.

The area that generates the most concern is the usual approach of having hospital accounts receivable staff re-assigned to address physician A/R. Wish it were as simple as "to-mat-o" vs. "tom-ato." But it's not! Consider the following differences in physician / hospital perspective:

Up-front payments: Physicians are usually more aggressive in insisting on payment at time of service: hospitals only beginning to become more proactive -- just look at outpatient A/Rs. Both could do better in obtaining secondary coverages and reducing residual self-pay balances.

Medicaid: Hospitals view it as an important payor -- even with all of its regulations; for physicians not only are fees too low, but payment time delays usually discourage participation, although the movement towards Medicaid managed care plans may mitigate some of these disadvantages.

Medicare: Part B administration emphases on procedural coding and acceptance of assignment. Part A administration emphasis on revenue coding, diagnostic coding and DRGs.

Automation: While hospitals are probably on second generation HIS with interface capability, physicians may be either on their first system, or at best, on a practice management system.

Managed Care: Physicians still relying on rosters supplied by payor, and participating in one or more plans, while hospitals still follow basic billing and collection processes, and tend to seek verification and authorizations amidst a host of operational issues.

With these differences as a backdrop, the MSO needs to ensure that new physician practices are able to show an improvement in administrative processing that the practitioner enjoyed previously. One way to ensure that result is to introduce new electronic transactions such as electronic eligibility verification, billing, remittance, and funds transfer into the practice management setting. In addition, when establishing an MSO with hospital staff, be certain to train them on the differences, in practice management requirements. If the MSO is to be a successful provider of billing and collection services, it will be necessary for it to adapt all of its strengths and technologies to a new environment. In preparing to enter these new relationships, we remind all parties: caveat emptor -- Let the buyer beware!

Next Issue: Outsourcing.

Emphasis on Education

...On Tour

Allan P. DeKaye, CMPA, will be presenting a new seminar entitled, "Improving Healthcare's Cash Flow." In this critical one-day seminar, the department managers that comprise the cash flow cycle, Business Office directors from the hospital, physician practice or other healthcare setting, as well as Admitting, Medical Records and Utilization Management directors will learn about The Five Point Plan for Improving A/R Management. The initial tour will cover:

> Pittsburgh, PA - April 23, 1996 - Holiday Inn at University Center

> Baltimore, MD - April 24, 1996 - Sheraton International at BWI Airport

> Philadelphia, PA - April 25, 1996 - Warwick Hotel

Registration fees are $179 per registrant with discounts available for multiple attendees and early registrations (received more than 10 days in advance) Call 1-800-889-2688 to register for this Business Network sponsored seminar.

... At the NMHCC

The National Managed Health Care Congress runs from April 28 - May 1, 1996.
Allan P. DeKaye, CMPA will be moderating two roundtable panels on Business Medicine. The roundtables will be held on Tuesday, April 30, 1996 from 10:45 AM - 11:30 AM and again from 11:45 AM - 12:30 PM. The NMHCC is held at the Convention Center in Washington, D.C. Please let us know if you'll be there. For more information call NMHCC at (617) 270-6000

...On the NET!

We've been Cruisin' the Net and have even found a few of you out there. There are a number of interesting places. We've visited a lot of places where Medical Record coding issued are raised. We've also been able to find resource materials and research information about topics like managed care, EDI, Systems, Medicare Part B, CHINs, etc. through listservers as well. Please let us know if you'd like help in finding out some information from these new sources. E-Mail us at adkcmpa@aol.com or dekayeconsulting@compuserve.com.

I read it in THE RECEIVABLES REPORT

In The Receivables Report newsletter, published by Aspen Publishers, Inc., a four-part series entitled, Perspectives and Commentary: Around the Four Corners has been written by Allan P. DeKaye, CMPA. The segments were written to describe the relationship between the four departments that comprise Healthcare;s Cash Flow Cycle. In each installment, there is a focus on another aspect of the interdepartmental relationship and how it impacts on accounts receivable management.

In the March 1996 issue, Organizational Issues were discussed, and in the April 1996 issue
EDI Solutions will be discussed. The May 1996 topic covers Managed Care concerns, and the final chapter (May 1996) will address Team Building Strategies. If you missed an earlier installment, please contact our office. If you want more information about The Receivables Report newsletter call Gene Lass at (414) 796-1380.

Did You Know?

Caring Increases Collections !

Mark Your Calendar !

Please join us and our associates from LexiCode at our exhibit at the 61st Annual NYHIMA Conference to be held on Long Island at the Marriott Wind Watch Hotel & Golf Club in Hauppauge, New York. The dates are June 2-5, 1996.

For more information about our services, or Strategic Alliance Partners, please write to us at: Adkcmpa@aol.com or DKConsult1@aol.com

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D E K A Y E Consulting, Inc.
231 Oakview Avenue, Oceanside, NY 11572  Phone: (516) 678-2754   Fax: (516) 825-4458
URL: http://www.dekaye.com E-Mail: Adkcmpa@aol.com or DKConsult1@aol.com