Your faculty members are excited that you will be attending the HFMA ANI Session F04: “Expert Panel…  A Financial Executive’s Guide to Comparing Revenue Cycle Performance”! The first question you may be asking, however, is… “Comparing revenue cycle performance to WHAT?”  Excellent question! You will be challenged in class to compare your current model to what your faculty believes is the indisputable Gold-Standard revenue cycle model. The model which is fully…

• Mission-congruent

• Patient-focused

• Access-driven

• Technology-enabled

• Fully compliant

• 100% quality-realized

• Right-sized

By using this tool you will take the first important step of your journey to “compare your revenue cycle performance”! You will be taking a look at just some of the opportunities that you will be able to realize when you implement the comprehensive Gold-Standard model. During the session, the panelists will then help you delve deeper as they reveal the wisdom they gained when they looked beyond the “traditional” indicators.

In doing this focused opportunity calculation, you will first insert the requested performance data related to your current revenue cycle outcomes. You may discover, however, that you are not able to find specific data for all of the outcomes that are highlighted. In other words – you may not currently be comprehensively tracking all
Gold-Standard indicators. In that case, you will need to provide your most reasonable estimate.

Next you will be asked to project the ultimate improvement you believe you can realize for certain key revenue cycle outcomes after you fully implement the above, indisputable model of revenue cycle excellence! It is important that you do not consider published industry benchmarks. And you should also not limit your estimate to incremental improvements. Rather – focus on the outcomes you believe would result through a “total conversion”!

To do so you must “set aside” all obstacles you believe are, or could stand in the way of the Gold-Standard model conversion. In other words… when you estimate the focused improvement outcome potentials that are highlighted in the tool, you must envision that you have been able to totally eliminate all of your current budget constraints, technology shortfalls, cultural hindrances, etc.

The following definitions will assist you in correctly completing this initial opportunity tool. Review the definitions and then, click on the link you’ll find following the definitions. After entering the requested information, your initial significant Gold-Standard revenue cycle bottom line opportunity will be revealed! Then, don’t forget to print out the results and bring them along with you to class!

Calculating Your Gold-Standard Revenue Cycle
Bottom Line Opportunities

Working Definitions

• Gross patient revenue:  The total charges issued to guarantors (i.e. third party guarantors and individuals) for patient services rendered.

• Net patient revenue:  The amount paid and expected to be paid for patient services rendered.

• Bad debt percentage:  Bad debt expense as a percentage of net patient revenue.

• Denials:  The amount of net patient revenue that is appropriately denied (i.e. not paid) by third party commercial and government payers because of inaccurate or inappropriate administrative processes including, but not limited to, invalid diagnostic or procedural coding, inaccurate or inappropriate charge coding, and insufficient administrative processing such as not obtaining pre-certification or re-certification; expressed as a percentage of total net patient revenue.

• Lost charges:  The charges for patient services actually provided that were never charged to the patient’s account expressed as a percentage of gross patient revenue. For purposes of this exercise, we will ignore the charges placed on the wrong account, and the results of third party chart/bill audits

• Net patient revenue from charge based payers:  The net revenue from third party payers that is paid because of the charges issued, including but not limited to, full charge payers and third party payer contracts which reimburse a percentage of charges; expressed as a percentage of gross patient revenue.

• Managed care net patient revenue paid under a discounted arrangement not based on diagnosis/procedure coding: Total net patient revenue from third party commercial contracts, including co-pays and deductibles, for which total payment is something other than charges in full or based on diagnosis or procedure coding. This includes percentage of charge contracts, per diem contracts, and capitation contracts; expressed as a percentage of total net patient revenue. This excludes government payers.

• Net patient revenue reimbursed based on diagnostic/procedure coding:  Net patient revenue that is determined based on the assigned diagnostic or procedural code, including inpatient and outpatient activities, for third party commercial and government payers, including co-pays and deductibles; expressed as a percentage of total net patient revenue.

Please click here to download the Revenue Cycle Improvement Opportunity Worksheet.