By Judy Lien

Billing optimization services just what the doctor ordered for Mary Washington Hospital
Like most businesses today, hospitals are looking for programs that can provide an increase in revenues with minimal expenditures, a real challenge given the recent increase in government regulations and guidelines. For many hospitals, the answer is a laboratory outreach program, selling services to internal and external clients outside the in-patient environment.

     However, these programs can be difficult to manage, requiring comprehensive data collection, accurate record keeping, correctly processed claims, and efficient billing. Labs unable to meet these challenges risk non-compliance with government regulations and can lose millions of dollars in revenue. In fact, statistics show that the industry average for laboratory outreach programs is to receive only 50 cents for every dollar billed.

le01.JPG (21174 bytes)“It was not profitable to run two laboratories. Misys Healthcare Consulting’s assessment gave credence to what we knew all along. It made upper management feel more comfortable about the direction in which we needed to go.”— Rebecca Damiani, Lab Director Mary Washington Hospital

From Outsourced To In-House
To increase the efficiency of its outsourced outreach laboratory billing operation, Mary Washington Hospital wanted to bring the process back in-house, making use of its existing hospital information system and internal billing department.

     Based in Fredrickson, Virginia, Mary Washington Hospital identified a number of key objectives for the project, including:
     •Implementation of new patient registration process
     •Implementation of new client billing process
     •Implementation of new physician database
     •Creation of new hospital service codes to facilitate billing and tracking of services
     •Integration of a new system with its existing hospital information system (HIS)
     •Creation of new client services function
     •Revision of existing fee schedules

To reach these objectives, Mary Washington Hospital turned to Misys Healthcare Consulting (formerly Balanced View Consulting), part of Misys Healthcare Systems (formerly Sunquest Information Systems).

Management Consulting and Implementation
According to Joe Stumpf, senior vice president at Misys Healthcare Consulting, the group’s new Billing Optimization Services (BOS) were just what “the doctor ordered” for Mary Washington Hospital. BOS is a two-phased assessment and implementation methodology to ensure proper and efficient billing for labs running outreach programs.

     BOS provides clients like Mary Washington Hospital with management consulting, implementation services, and advanced technology services that are within the HIPAA requirements. BOS enables outreach labs to effectively oversee their billing operations, streamline processes, and thereby significantly increase revenue.

le02.JPG (23554 bytes)Rapid Deployment of Solution
During an initial two-week period, consultants assessed the outreach billing operations at Mary Washington Hospital, including demographic data gathering, order entry processes, claims submission, payment posting, collections, and reporting processes. The consultants determined workflows, identified problem areas, and made recommendations for improvement. Upon completion of the assessment, the hospital received a written report detailing the necessary steps for improving the efficiency of their billing operations.

     Based on these recommendations, the Billing Optimization Services team redesigned the outreach billing workflow, streamlined processes, improved data collection, enhanced collection procedures, and implemented new financial technology. Cost savings were projected in as little as six weeks of implementation, with a very favorable ROI.

Consulting services included:
     •Process redesign and implementation
     •Client training
     •Interface testing
     •Database development
     •Compliance audit process development

le03.JPG (22075 bytes)“Along with the significant increase in revenue, the most notable improvement has been the positive comments from clients whose bills are much more timely and accurate than in the past.” — Ravi Mathur, CFO Mary Washington Hospital

Greater Internal Control, Improved Customer Service
     With improved workflow processing and a straightforward financial system, outreach laboratory programs, like the one at Mary Washington Hospital, can rapidly become profitable.

     When Misys Healthcare Consulting began work at Mary Washington Hospital, the outsourced billing operation had already been discontinued which resulted in a backlog of client billings. Therefore, it was critical to get the new internal billing system in place as soon as possible. It was in operation within three months.

     Today, the hospital’s outreach laboratory billing is processed internally using the existing hospital information system. Because the new billing system was implemented without adding additional FTEs, costs are lower than they were when the process was outsourced.

     While Misys Healthcare estimated that a 30% increase in revenue was possible for Mary Washington Hospital, the latest measurement showed an increase of 54.3%, representing an annual gain of $1.85 million. What’s more, the hospital has improved customer service by producing more timely and accurate billings for its clients.

Judy Lien is practice manager, Misys Healthcare Systems