Value-Based Payments Can and Will Break Traditional Patient Accounting Systems

The Affordable Care Act includes many healthcare regulations unrelated to the distribution of insurance and expanding Medicaid. One important part of this legislation allows the federal government to explore new payment methodologies that they believe more accurately compensate providers for their services.  For acute care facilities, the term used for these new payment models is “Value-Based” payments where data previously considered to be unrelated to the billed services is used to determine the compensation for providers.

For hospitals providing services covered by this model, post discharge data is used to determine the outcome of the service.  This outcome will then have an impact on payments for these services.  In this new model, discharging a patient is no longer the “end point” of a billed service.  The service is expanded to include post discharge services and results.  This is a revolutionary concept and as it applied to other services, it will have major impact on the hospital industry in many ways that are both intended and unintended by this model.  Regardless of your point of view regarding the fairness of this payment model for this service and others like it, there will be problems with existing patient accounting systems in dealing with this new reimbursement model.

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Drones and Healthcare IT

It has been a month since my last post.  I normally don’t take so long, but sometimes life takes over and you don’t always have the free time to get your thoughts down on virtual paper.  Although my writing has been lax, I have been reading quite a bit lately.  Now it’s time to write again.

Around this time of year, we see the obligatory bests and worst lists of the ending year.  Like most people, when I read these lists I often think of what is missing that makes these lists incomplete or rankings that seem irrational or unjust.  There were several examples of these I saw regarding healthcare IT that examined the past year and what is coming in 2016.

Instead of discussing a list, I would like to point out a single completed objective that all of us should reflect on as we evaluate 2015 and look toward the future adoption of new technology in healthcare.  During late 2015, we converted from the ICD9 to ICD10 diagnosis code set.  This was over 90 days ago and the expected major disruptions associated with this change have never materialized.  Like Y2K and Obamacare, we have once again proven that healthcare is an industry that can absorb change and adapt to new procedures.  We have demonstrated again that we normally overestimate the negative impact of change and our ability to cope.

 

Drones and Healthcare IT

 

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The Recovery Audit Program: The Big Business of Medicare Audits

The MACs (Medicare Administrative Contractors) audit claims submitted by providers within their jurisdictions.  These organizations are mostly insurance companies who administer the contracts awarded by CMS to process claims submitted electronically by providers in a given geographic area.   As part of this responsibility, these MACs are required to make sure that the claims submitted are complete and submitted in accordance with the rules developed by Medicare to assure that these claims are for services that are medically necessary and properly documented.

They work similar to the IRS, examining submitted claim data for outliers and patterns of suspicious behavior.   Like the IRS, they perform this service as part of their contractual obligation to the government, not as a revenue generating activity.

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The Value Proposition of Hospice Transfers under Medicare Reimbursement

“Medicare coverage of hospice depends on a physician’s certification that an individual’s prognosis is a life expectancy of six months or less if the terminal illness runs its normal course.”

This is the criteria set by Medicare for admitting a patient into hospice. CMS provides several documents that provide guidelines for determining if patients qualify based on their clinical situation and this definition. These documents state that this is an inexact science and that it is understood that some patients will last longer and that some clinical issues and indicators are much harder to use for predictions than others. For example, weight loss is a very good indicator, loss of cognitive function is not. These documents also describe how patients can be discharged by a hospice if the clinical data changes to the point where their remaining lifetime is expected to exceed this six month guideline.

Budgeted Hospice Caps

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The Potential of Data Analytics in Healthcare

Earlier this week, I attended a symposium on healthcare data analytics held by Health Data Management in Chicago.  This was the fourth year of the convention and the first year that I attended.  I have attended many healthcare conventions over the last 30 years, mostly related to financial transactions, data and topics related to revenue cycle management.  This meeting was unique in that it related data to all types of healthcare management and showed how numbers could be used to predict the future as well as analyze the past.

Forward thinking organizations were already using analytics to do some pretty amazing things.  One facility had developed tools to predict future readmission rates of their own patients, another had predictive analytics for projecting future short term emergency department demand so that they could staff for these fluctuations in advance.  This tool used internal data collected by the healthcare organization and external data like traffic, weather and social media.

Vendors had tools that could not only model historical data and test hypotheses, but could measure and identify trends from data unseen by users.  New algorithms used in other industries can be applied to healthcare data to allow computers to assist users to explore their own information.  Think of when Netflix shows you “other films you may like” or when Amazon suggests similar products.  This technology can be used in healthcare to suggest things you may be looking for, but may not have thought of yet.

Bubble Graph
Potential of Analytics

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The Perception of Quality

As a president of a software development company, I am both a vendor and a consumer of customer service.  After 30 years of working with my customers and obtaining supporting services for our tools and systems, I have learned the value of quality service and the damage that is caused when this aspect of our business is taken lightly.

Despite your opinion of the Supreme Court decision in the Citizen’s United case a few years ago, it seems to me to be a fact that corporations, and all forms of social organizations, develop a personality similar to individuals.  From this perspective, corporations really are like people.

Like individuals, corporations can be generous and caring, willing to sacrifice short term gains for long term results.  They can be driven, focused, and talented.  They can also be cold, vindictive and focused on the next measurable performance period at the expense of everything else.  Like people, the superficial organizations that talk about quality and teamwork without actually backing it up with action are much more common than those that actually exhibit these qualities.

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Obamacare and the Future of Healthcare

As everyone knows by now, the Supreme Court upheld the constitutionality of state healthcare insurance exchanges subsidized by the federal government.  If this decision had gone the other way, it could have had a significant impact on the percentage of insured patients currently, and in the coming years.  With this decision, this key component of Obamacare seems to be a permanent part of the future financial core of healthcare reimbursement.

I was traveling when I heard the announcement.  A few hours later, on CNN, I saw the news about large jumps in the value of stock for major healthcare insurance companies like Aetna, Cigna and United Healthcare.  Many of these organizations were seeing increases of 15% to 40% in a single day toward the value of their shares.  I began thinking about how this will impact my own company and healthcare delivery in general in the coming years.

obamacare
The future of healthcare.

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Medicare Public Use Files

CMS has provided access to data collected through the administration of claims to researchers since 2003 through the PUF (Public Use Files).  These files contain useful information on patients going back to 1999.  These files are offered for free as CSV (spreadsheet) files and offer valuable information on specific healthcare services.

These files are designed for researchers, but for you number crunchers out there, they can provide valuable insight into industry trends and how your own organization compares to your competitors.

For example, the current PUF file on hospice beneficiaries contains data for 2010 for a total of 56,943 beneficiaries.  The file contains eight pieces of information for each one.  These totals come from the data dictionary and code book describing this file.  The totals themselves are very interesting:

Public Use Files
Medicare Public Use Files

 

 

http://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/BSAPUFS/Downloads/2010_BSA_Hospice_Bene_PUF_DataDic_CB.pdf

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Evolution and Healthcare IT

When I was taught the theory of evolution in school, I was under the impression that species evolved slowly, over millions of years, leading steadily toward more advanced life forms more capable of dealing with their environment.  I can still remember the  March of Progress or the “ape to man” illustrations of earlier versions of our species, each appearing to be more like us and standing more upright as you moved left to right through the images.

As an adult, I learned more about how evolution actually worked.  In nature, it never was a straight line from less efficient species to more efficient ones.  The reality was that nature adapted to its environment through trial and error.  For every advancement through genetic mutation, millions of mutations created less efficient organisms that never survived.  In addition, from time to time, mass extinction events wiped out a majority of the species on earth leaving nature to start over, nearly from scratch.  This lead to two different evolutions of dinosaurs and the eventual rise of the mammals.

March of Progress
Matt Groening – Homersapien

 

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Big Brother Versus the Integrity of Healthcare Data

In my previous article, we discussed the issues surrounding the National Provider Identifier (NPI) and the Health Plan Identifier (HPID). The NPI has been successfully implemented, the HPID is delayed indefinitely. The last required identifier remaining to be implemented from the original HIPAA legislation is the National Patient Identifier (also NPI) sometimes referred to as Master Patient Index (MPI). The intent of this code set is to create and assign a unique ID to every patient who receives healthcare in the United States.

This code set is intended to address the “holy grail” of healthcare IT, the ability to relate patient data for an individual collected by different entities and for different encounters into a single integrated medical record. The benefits of this achievement seem fairly obvious. Clinical data could be shared and updated by all providers interacting with a patient. The quality of care would improve and medical mistakes would be reduced.

master patient index

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