- Healthcare payment integrity is becoming increasingly important as hospitals face financial challenges.
Uncompensated care is on the rise again, with bad debt and charity care increasing to $38.3 billion in 2016 after a steady decline since 2013, the American Hospital Association (AHA) reports.
New value-based reimbursement models, shrinking reimbursement rates, increases in patient financial responsibility, and an uptick in government mandates are also exacerbating financial issues by making it more difficult to get paid.
Government programs acknowledge the challenges hospitals face with delivering care to their beneficiaries. Medicare and Medicaid offer supplemental payments for bad debt, medical education, and uncompensated care, as well as for treating sicker or low-income populations through the Disproportionate Share Hospital (DSH) designation.
Government reimbursements can help hospitals shoulder the burden of financial challenges.
However, hospitals oftentimes neglect to claim the supplemental reimbursement or attempt to recoup lost revenue. For example, 21 percent of hospitals in a recent Sage Growth Partners survey had no bad debt recovery strategy in place, and 18 percent never re-checked insurance eligibility to recover revenue.
Hospitals are struggling to keep up with healthcare payment integrity because the industry is constantly changing, explains TransUnion Healthcare’s Director of Client Development, Joe Gumbert.
“Information changes,” he stresses. “On the subject of DSH payments, what you know to be your Medicaid population today will be a different population tomorrow. People can become eligible for Medicaid services retroactively.”
“If you're not looking at these things consistently, there’s a chance you're going to miss out on some reimbursement and report some incorrectly,” he emphasizes.
Staying abreast of regulatory and patient changes also requires resources that hospitals don’t typically have, points out Jonathan Wiik, Principal at TransUnion Healthcare and author of Healthcare Revolution: The Patient Is the New Payer.
“You typically put resources on DSH because that's part of the Medicare cost report required for participation in the federal healthcare program,” he says. “As for Medicare Bad Debt or Transfer DRGs, dollars are out there that the hospital may not know about because they frankly don't have the time or the awareness to put resources on it.”
Hospitals can recoup lost revenue stemming from government reimbursement opportunities by implementing a healthcare payment integrity solution that streamlines claim data collection and compliance for providers.
Automating healthcare payment integrity to boost the bottom line
Healthcare payment integrity solutions help hospitals manage the complex processes associated with supplemental government reimbursement, particularly through data collection.
“Getting the information correct requires the matching of disparate datasets from various sources. You have to stay up to date with federal and state regulations in order to understand how that data makes sense to produce accurate results,” Gumbert explains.
An automated solution can assist hospitals with piecing the information together to identify healthcare underpayments and opportunities to maximize reimbursement. For example, some solutions connect to Medicare datasets to identify beneficiaries with previously unknown insurance coverage or re-file claims with underpayments.
Implementing an automated solution will shift the burden of healthcare payment integrity away from already busy staff members. But the solution will not meaningfully help hospitals recoup lost revenue if it doesn’t come from a trusted vendor or business partner, warns Wiik.
“There's a lot of noise right now,” he says. “There used to be ten to a hundred vendors or business partners in the market. I'd argue there are thousands now. And there are many trying to be everything to everyone.”
He advises hospital leaders to look for vendors with well-established data source connections. For example, a solution should be able to leverage data from Medicare to identify revenue loss.
Connecting with other large data sources that contain personal information on patients can also improve patient matching and revenue integrity.
“Has she moved a lot? Does she have fraud issues? Is there is a social determinant of health issue that makes her higher risk than someone else,” Wiik states. “Those are all things that will play very nicely into reimbursement optimization, especially as hospitals look to project outcomes for next year.”
Having the right technology in place with the right vendors or consultants is the key to ensuring reimbursement is paid in a timely fashion.
About TransUnion Healthcare:
TransUnion Healthcare, a wholly owned subsidiary of credit and information management company TransUnion, is a trusted provider of Revenue ProtectionTM solutions that help providers collect more cash up front and throughout the revenue cycle, and identify and maximize reimbursement opportunities to reduce bad debt. By leveraging our data assets, market-leading revenue cycle management technologies, and deep insights into consumer financial behavior, our customers are better enabled to reduce uncompensated care, engage patients early and improve cash flow. Click here to learn more.