| As hospital and other health care business offices are | | | | Cashiers: Organization, cashier workflow, posting |
| compelled to operate "lean and mean" due to severe | | | | procedures, routing of remittance vouchers, refund |
| shortfalls in revenue as cost control measures fail to | | | | policy, documentation, and controls. |
| keep up with rising cost, a growing number are turning | | | | Collection: Organization, follow-up procedures, collection |
| to outsourcing their entire business office operations. | | | | parameters, write-off procedure, bad-debt policy. |
| A typical full-outsourcing engagement would | | | | Finance: General-ledger reconciliation, reporting. Upon |
| encompass "cradle-to-grave" servicing of the client's | | | | initiating any outsourcing project, a kick-off meeting |
| accounts receivable. This arrangement usually involves | | | | should be held. Key managers from the outsourcing |
| a contractor who assumes responsibility for staffing | | | | company and hospital employees from all functional |
| and operating the business office function and | | | | areas of the patient revenue cycle should be brought |
| manages the receivables from initial billing through | | | | together to brainstorm on the project goals. This is a |
| collection. | | | | vital part of the overall outsourcing strategy process. |
| The contractor typically uses existing hospital business | | | | A goal that could be created by this core team might |
| office staff and supplements the operation with | | | | be for the contractor to recover 85 percent of the |
| consultants and preparation systems from their own | | | | netted placement. It is also important, at the start of the |
| organizations. This full-service approach can | | | | design phase, to establish lines of communication and |
| encompass accountability for every aspect of the | | | | to establish agreed upon benchmarking goals. When |
| business office, from billing and patient collections to | | | | using an outsourcing service for the first time, asking |
| third-party resolutions and call center functions. This | | | | questions and developing account-processing |
| type of arrangement tends to be long term with a | | | | protocols, along with a detailed master plan, are |
| typical contract period of three to five years. | | | | essential to ensure that the hospital's detailed |
| Although full outsourcing might be a way to bring in | | | | expectations are in line with what the contractor can |
| experts to run your operations, recent studies have | | | | provide. |
| shown that many of these outsourcing arrangements | | | | Another important factor to consider prior to the |
| ultimately fail. Why? | | | | start-up phase is the criteria and procedures for writing |
| It seems to be that more often than not that these full | | | | off outsourced accounts such as uncollectibles and |
| outsourcing firms do not move quickly enough in | | | | contractual allowances. |
| learning of their client's specific payer issues, billing | | | | An additional crucially important ingredient is to include in |
| systems, processes, procedures and account flow | | | | the arrangement specific goals and performance |
| protocols. It is crucial to the success of full-outsourcing | | | | metrics for measuring them. Status meetings also |
| that the outsourcing firm conducts a through review of | | | | need to take place weekly, monthly or bimonthly. |
| the provider's process flow and billing cycle contract | | | | What is emerging among the best practices for |
| prior to servicing the outsourced receivables. | | | | managing the outsourcing relationship is a model where |
| The purpose of such an evaluation is to conduct a | | | | hospital CFOs are hiring consultants to supervise the |
| top-to-bottom operational review including an analysis | | | | work personally and withhold invoices until agreed-upon |
| of billing systems, billing practices, staffing | | | | metrics are met early. These consultants manage |
| methodologies, staffing levels, an a comprehensive | | | | very specifically the type and degree of improvements |
| accounts receivable analysis. This should be the first | | | | you want to achieve. You don't want to micromanage |
| phase. Specific departments and areas of review | | | | but you want to make sure they're doing what you |
| should include: | | | | wanted, the way you wanted it done. |
| Admitting/Registration: Organization, admitting/discharge | | | | Full outsourcing has become an increasingly important |
| transfer systems, work flow, insurance verification, | | | | topic over the past few years. If correctly established, |
| backlogs. | | | | strategic full outsourcing of receivables can be an |
| Medical Records: Organization, documentation, coding | | | | exciting and effective option to address receivable |
| accuracy, communications. | | | | concerns. Outsourcing companies have remarkable |
| Patient Accounting: Organization, billing systems, IP/OP | | | | new technologies and software at their disposal that |
| claim flow, charge master, financial classes, insurance | | | | can ensure quick contacts. When the start-up phase is |
| payer mix, monthly detail summary reports (accounts | | | | established correctly, outsourcing firms can become |
| receivable, aged trial-balance report, revenue, | | | | outstanding partners and true extensions of your own |
| payments, adjustments, credit balances, write-off | | | | business office. |
| totals, recovery totals). | | | | |