Service Management in Hospitals – “The Moment of Truth”

Healthcare Providers are in a more competitive environment than ever before. Patients are making self-directed decisions and they are well informed about their options. There are many websites and other sources patients can access to get information ranging from clinical outcome measurement to peer experience accounts by other consumers.

Interestingly, their decisions are increasingly centered on level of service defined using criteria like wait time, staff attitude, question resolution and patient friendly billing/charge explanation (a diversion from clinical criteria). The impact of this shift in today’s market is magnified when one considers what we have learned about consumer behavior in other industries and how it may now apply to healthcare. For example, TARP conducted research cited in the book “Service America” by Albrecht and Zemke that revealed in part the following summarized findings:

• Unhappy customers who had a problem with a service organization will tell 9-10 people and 13% of customers who had a problem will tell >20 people.


• You will never hear from 60% of unhappy customers.


• Complainers are more likely than non-complainers to do business with companies that upset them.


• Of customers that do complain, 54-70% will do business with you again if the complaint is resolved and a staggering 95% will do business again if the complaint is resolved immediately or quickly.


• Customers who complained and had the complaint resolved satisfactorily will tell an average of 5 people.


• For every complaint received, 26 other customers have problems, 6 of which are considered "serious".

Powerful stuff!

In your organization you have probably heard management directives like “service is everybody’s job”. But how do you know how you are doing if the percentage of unhappy patients who complain is relatively low? You may have patient surveys conducted routinely and those often provide useful feedback and trend analysis driven by the questions constructed jointly by your marketing team and an external resource. But what about all of the patients who did not participate or were systematically excluded in those conventional methodologies? Remember, every unhappy customer is likely to tell 9-10 others about the bad experience they had but they are not likely to tell you!

Here is another methodology we believe every provider organization should embrace as part of a service management strategy – the "Moment of Truth Audit”. A “Moment of Truth” can be defined as any encounter a patient or prospective patient has with your organization in which they can form an impression about your organization. The Moment of Truth Audit approach involves:

1. Discovery; an initiative designed to determine and define what Moments of Truth exist in your business. You might be surprised by how people form their opinions.


2. Assessment; empirical and scientific evaluation of each Moment of Truth Outcome.


3. Empowerment; a plan designed to empower the orgnization to manage service based on Moment of Truth Outcomes.

As one of our clients so aptly put it, “GET YOUR MOTO WORKIN!” (MOTO=Moment Of Truth Outcomes).

We are especially interested in your feedback related to this topic. For example:

What are you doing in your organization to improve customer service?
How do you measure service performance?
Do you have stories you are willing to share that might help other facilities?
Are you generally interested in improving patient service?
Would you consider using a professional services firm to help you improve financial service perception?

Please respond to this blog or just call us if you would like to contribute with peer comments about service management.

Jim Matthews; Principal, Nearterm Corporation

Let’s get acquainted at the HFMA Region 9 Conference next week!

If you are coming to New Orleans next week for the HFMA Region 9 Conference, please come to the exhibit area and meet me at area #19. We are always eager to meet new friends and colleagues.

If you are not coming to the conference, we will come to you! Check out the Nearterm website or just give me a call at 281-646-1330.

Jim Matthews

“Will We Pay These Guys More Than We Collect?”

Nearterm has an Interim Management contract serving one of our more complex multi-facility clients as Interim Revenue Cycle Director. One issue identified during initial analysis was a 7 figure backlog consisting of delinquent accounts with a reasonable probability of collection if worked properly. In this case it was determined that a lot of on-site research would be required. That determination led our client to consider the option of bringing in Interim AR Specialists (Billing and Collection Experts) to work in the business office rather than outsourcing the AR to a remote collection service.

When the Revenue Cycle Team presented this option to the CEO in the form of a recommendation, the very astute and entrepreneurial CEO asked a question that I thought was so simple it was brilliant:

“WILL WE PAY THESE GUYS MORE THAN WE COLLECT?”

I am a student of simplicity, among other things. My background in management consulting, organization development and revenue cycle strategy has required me to help hospitals transform seemingly overwhelming challenges into bite-sized action plans that are in a word “simple” enough to be actionable. So, when a client recently asked this question of one of our senior professional staff, I thought it was worth presentation.

Obviously there are a lot of surrounding considerations that would be answered before a decision could be made but if you can get to “yes” on this one, it certainly means you have mitigated the risk!

In many situations, it is advantageous to outsource to a remote service provider. We often recommend it and frequently help with vendor selection. However, in cases where extraordinary repeated interaction with case management, clinical, health information management, financial, IT and/or other disciplines is necessary at the account level, many vendors lose interest or minimize work protocols. In those cases onsite AR Specialists are a great option.

If you have experience with decisions related to this topic that would be helpful to your colleagues, please share. Nearterm is a repository for revenue cycle case study and we would welcome your input.

Hospital Access Professionals Wear A Lot Of Hats–How About “Loan Officer”?

Most hospitals understand how important admitting and registration professionals are in terms of public image and customer service. They are often the first encounter a patient has with a hospital and therefore represent the first opportunity for a patient and/or loved one to form an opinion about the facility. The intake process and even communication prior to arrival can make patients feel comfortable, confident and trusting in what can otherwise be a very intimidating provider system. That is important in today’s competitive healthcare environment where increasingly patients make choices.

Admitting representatives also have another critical role – Hospital Loan Officer. Just think, they categorically extend more unsecured credit than you see in any other industry. Every time a patient is admitted or treated as an outpatient without paying in advance 100% of the charges in cash, credit is extended. The only collateral is an insurance card, Medicare/Medicaid card, verified coverage or maybe a promissory note – no collateral. It is billions of dollars each year in unsecured credit.

Sometimes non-resource patients apply for charity care. This requires an extensive application process involving proof of income, ability to pay, proof of residency and other components. Sounds like a credit application to me. It is typically initiated and often completed with the guidance of an access representative.

Suffice to say that the role of access professionals in the healthcare delivery system is extremely important! They are the first impression and they have everything to do with getting paid. If that is the case, one might speculate about the recruiting practices, on-boarding, pay scale, training, schedule and many other items used to ensure that these functions are conducted effectively. The expectation would be that these positions would be highly trained and well compensated. If that is not the case, the organization may have a difficult time competing. Let’s face it, it is has been traditionally difficult for hospitals to maintain an access team that “wows” the public but still minds the purse strings. Those folks are hard to find and keep.

My thought here is not so much to talk about what we are doing now – you probably already know that about your organization. I offer the idea that hospitals should consider recruiting admitting personnel with banking or credit screening experience. The characteristics banks, lenders and screening companies are after include:

- Detail orientation and thoroughness

- Professional appearance

- Articulate, good interpersonal communication skills

- Computer savvy

- Comfortable asking for personal information and money

- Sensitivity in face to face encounters

- Ability to say “no” when necessary

- Knowledge about basic financial practices and ability to apply specific policy

- Commitment to confidentiality

- Tolerance to work with a diverse public

- Willingness to initiate problem escalation

I submit that hospitals might be well served to weigh these characteristics and non-hospital experience that requires these characteristics more heavily than healthcare experience when hiring entry level admitting staff. This practice expands the labor pool beyond those with healthcare background and ensures that fundamental qualities are present among the candidates. It is much easier to train a new hire in the nuances of hospital policy and procedure than to teach them the things listed above.

At Nearterm, our Patient Access Consultants have introduced and implemented this kind of thinking successfully in many provider organizations. This process typically starts with assessment of the access system and advances to a conceptual design, work plan and implementation. We also advocate other hiring practices that are “outside the box” both for our clients and internally. Related innovations we have facilitated are remote verification, pre-admission and financial counseling.

Our Healthcare Search Professionals work with clients daily as we partner to re-invent hiring guidelines designed to attract the kind of talent they need. We are always available to discuss patient access, admitting and registration issues with hospital revenue cycle managers.

Revenue Cycle Manager or Revenue Cycle Leader – Which are you?

First allow me to clear the air a bit; neither is “better” than the other and we need both to meet the revenue cycle challenges ahead. Also, volumes have been written on this topic so this is not an effort to present a treatise on leadership or management. It is just a summary of recent thoughts on the subject.

I just heard an interesting definition of “leader”;

“A leader is one who has willing followers”

This seemed so oversimplified that I almost dismissed it but then realized that many who consider themselves leaders look behind them to find no willing followers. There may be employees, customers, colleagues or others who do what is asked of them but that alone constitutes a “management relationship”, not necessarily leadership. Obviously, you cannot be a leader without willing followers.

People are willing followers because they believe in a leader who has vision and value prioritization. Most people when asked to list their 10 most important values will create about the same list. It is how the list is prioritized and applied that often separates leaders from managers.

Vision and value prioritization occurs every day in the hospital environment. A CFO is required to make a decision that weighs patient care against budget constraints. The VP of Revenue Cycle considers how aggressive to be with collection practices that can influence both the bottom line as well as service perception in the community. There are many other examples. Leaders make these decisions effortlessly in a way that attracts followers.

An obvious question arises, “How do leaders do that and can others learn to do it?” I submit that all leadership skills except one can be learned and that is TALENT. It is talent, combined with a litany of learned competencies that allows leaders to be leaders. If you do not have talent, people will not follow. You cannot learn to be talented.

Here is what I think is important in this context. Leaders give direction, but it is managers who know how to get there. Regardless of your place in the organization, never underestimate the importance of both. It is a symbiotic relationship wherein neither role brings value without the other.

iPad2 WINNERS!

Congratulations to Nancy Brock, CFO of Christus St. Catherine in TX (pictured above with Jim Matthews, Principal of Nearterm Corporation) and Steven Bender, CFO of Wuesthoff Health System in FL winners of our iPad2's! Thanks everyone for visiting our booth at the HFMA ANI! See you all again next year!

iPad2 DRAWING IS TODAY!

STOP BY BOOTH 1914 AT THE ANI AND MAKE SURE YOUR NAME IS ENTERED TO WIN ONE OF THE iPAD2's. WE WILL BE DRAWING A WINNER AFTER THE BREAK!

iPAD2 AT THE ANI!

JOIN US AT THE ANI, BOOTH #1914, WIN AN iPad2

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GREAT iPad2 GIVEAWAY!!!!

JOIN US AT THE ANI, BOOTH #1914, WIN AN iPad2

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GREAT iPad2 GIVEAWAY!!!!

VISIT US AT HFMA’S ANI BOOTH #1914 AND WIN AN iPad2

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Work claim edits remotely – a great idea for many hospitals.

We all want to handle claims only once. We do all we can to preclude denials. But when you categorize the reasons your scrubber rejects claims, you find that in order to resolve that prioritized list, many disciplines have to get involved e.g. coders, clinicians, charge master, and perhaps the patient. Often more than one of these disciplines is involved so that tracking resolution progress becomes a challenge. That said, most hospitals find that a credentialed coder can quickly resolve a high percentage of edits. Coders are in high demand and short supply so therein lays a challenge in many communities.

One hospital has addressed this challenge by using remote coders to manage claim edits. This is different than the commonly used practice of remote coding because the work volume includes only rejects, not initial charts and the work list is generated out of the billing system. All claims “kicked out” by the billing edit system for a coding-related reason are routed electronically to a remote coder who has access to facility records via VPN. Claims are resolved same day and returned for billing. The hospital has captured the following benefits as a result of this protocol:

• Claims are turned around for billing immediately instead of enduring a routing process in the hospital. The hospital gets paid faster.



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  There is little or no allocation of hospital based coder time to respond to billing requests. Vacancy, vacations, volume swings and other factors driving the availability of hospital based coders to work on claim requests are no longer a problem for billing.



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  It is a cost effective way to access professional coding time. As volumes fluctuate from day to day, utilization of the remote coder time fluctuates proportionately.



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  Remote coders can focus on identification of patterns and recommend solutions easily because they are focused only on claims that have rejected. They might recommend charge master updates, new coding practices, physician education and/or many other ideas.

The process is very easy to implement and there is no start-up cost. If you are already using remote coders to work your edits, please share your experience with us. If you are considering it, please feel free to contact Nearterm and we will be happy to explore the details with you.

Nearterm recognized by Houston Area Association of Personnel Consultants

Nearterm was again recognized at the Annual Houston Area Association of Personnel Consultants (HAAPC) awards banquet on Wednesday, April 20th for a variety of “wins”. Among them, we were # 1 in the contract/temporary technical professional division. Jim Higgins was recognized for his many contributions as a Lifetime Member.

Congratulations all!

Please come visit us at the HFMA Gulf Coast Chapter Annual Meeting & Conference

Nearterm has always promoted revenue cycle education, both through our practice and also sponsorship. As Silver Sponsors, we are excited about the HFMA Gulf Coast Chapter Annual Conference scheduled for May 26th at the Omni in Houston. The educational content will be great and the networking opportunities make this conference a very enjoyable event. We hope you will stop by our exhibit area and say hello!

What are the “pros & cons” of centralized revenue cycle processing?

Provider organizations that have become multi-facility entities often consider centralizing revenue cycle and/or AR processing. The strategy is usually aimed at lower operating cost, performance improvement and better customer service. Nearterm has a lot of experience assisting clients with centralization (and decentralization) initiatives and so we could write volumes on this topic, but in lieu of that, this BLOG offers a just few “bite sized” observations that you might find interesting.

Homogeneous Volumes:
Banking, financial services, retail industries and others have been very successful with centralized billing, payroll, collection processing. If they can do it, we can do it, right? Not so fast. Every transaction processed through their clearing houses looks the same. A VISA charge transaction is the same in every state and for that matter, all over the world - homogeneous volumes. However, when two or more hospitals having different operating systems, contracts, policies and patient types consolidate, the volumes are different - heterogeneous. There are technical solutions but cost, lead time and maintenance of these conduits can be material in the centralization decision. If the organization does not achieve like volumes in the proposed processing environment, arguably, it has just combined things under the same roof, still functioning as before and with little or no gain of efficiency.

Distributed Impact:
There are two ways to capture the benefits of distributed impact through centralization of hospital revenue cycle processing; management and technology. Consolidation of organization structure usually results in a budget that improves compensation offerings available to build a new management team. This enables you to attract stronger talent and benefit from their expertise across the newly centralized operation. Likewise, surviving technology represents an opportunity.

Business Relationships & Communication:
Relationship challenges are often underestimated. We are referring to the multiple relationship and accountability changes that occur when for example a hospital moves billing and collections to a centralized business office (CBO). Who is responsible for AR performance? If the hospital is allocated CBO expense, does it have control over CBO budget? How are data collection and data entry problems that begin in access handled to the extent that they impact CBO performance? There are many questions to resolve well ahead of the decision to centralize. We recommend report design that clearly delineates accountabilities between entities and detailed policy statements about accountability. Drafting these and using them as compatibility “tests” prior to the decision may reveal crucial development opportunities that if addressed, promote a harmonious and successful transition.

Summary:
Centralization and consolidation of revenue cycle processing can be a very effective way to meet the challenges facing provider organizations in these changing times. Many have done it successfully. We also know that many “centralized” organizations would like to “decentralize” and would say they should never have done it in the first place. Generally, the key is consensus about expectations, timeline and accountability established as part of the decision process, not the implementation process.

The above are intended as broad overview. Nearterm Revenue Strategists are always ready to work with you in considering AR processing venue and any other Revenue Cycle initiatives under consideration.

Too busy to look at patient accounts?

I actually thought I was that busy myself early in my career. After all, there was a hospital budget to prepare, a seemingly unending stream of meetings to attend, performance appraisals to complete, AR reports to produce/review, a conversion right around the corner and a myriad of other priorities. Then one day I was asked, “What is the work product of the revenue cycle organization that you manage?” That’s an easy answer, I thought….it is 3 things-cash, patient satisfaction and cost effectiveness. Then came a lightning bolt that said those 3 things are certainly objectives but they might not be the work product. I asked myself what I could do to ascertain that the revenue cycle team was doing the things every single day that help us achieve those objectives. Conclusion; look at accounts and think of that as a review of our work product. Include that as part of my management practice.

The protocol was more than a look at random accounts. Reports were designed that queued a specific stratification of patient type, payor, balance range, age and alpha split at intervals that would provide me with statistically meaningful samples. I scheduled 3 consecutive hours each week to shut my door and review the designated accounts. The review was a discovery process so I looked at almost everything in each account history. When problems and/or questions came up, I would either call whoever in my organization was responsible, ask them to pull up the account and review it with them or else post a note to the account requiring a response. I was in a leadership position and had a lot of employees in several facilities reporting to me so these calls and notes came as a surprise to many until word was out that I had embraced this practice.

If I had to single out a management practice that effectively helped us improve revenue cycle performance and accountability, review of work product would be it. A number of positive things happened relatively quickly when this protocol was implemented. Here are a few examples;

• We learned that many of the things we thought we were doing were not really being done consistently or in some cases at all. By surfacing these items, we could address them. You can’t fix what you don’t know about.


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  The entire organization, not just the management team, became engaged in problem solving. When account history patterns surfaced, the people doing the work typically had the right solutions but had not been asked for their ideas before.


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  It became apparent throughout the revenue cycle organization that account documentation was of critical importance. When I would call an AR technician to ask why no work was documented on an account, the response was often that the work was done just not documented. We had a teaching moment to reiterate “If it is not documented, it was not done”.


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  Managers who reported to me were out of touch with the work product of their employees. When I personally began to get involved at the detail level, they quickly realized they had better do the same. When I identified a problem by talking with one of their staff, I would then contact the manager to discuss the problem and how we might solve it. It was not long until they too began account reviews similar to the ones I was doing so that they could identify and bring opportunities to me rather than their folks telling me. They were a very good team when we started and were even better as a result of this practice.


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  I had always talked and written internally about what was important in our organization. However, I don’t think people embraced my guidance about what was important until they saw that I was investing my time focusing on lag times, wait times, quality of calls, frequency of contacts and other things I could see by looking at a patient account. As I shared in a previous BLOG, people decide what is important based on how we spend our time, not what we say or write in memos.


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  The whole process was not only revealing and educational but it was also fun! I got to know the people doing the work a lot better and enjoyed the collegial approach that grew from the process. I got a lot closer to the people in my shop.

As a revenue cycle strategist, I am critical of senior managers who are not attuned to the details of their operation. Patient account managers have to have a mechanism and the discipline to know what is happening in their offices.

What can revenue cycle professionals learn from military science?

As Revenue Cycle professionals, we are often asked to develop and present a “strategy” but we are rarely asked to address “tactics” per se. As a result, the defining line has blurred between the two. Take a moment to review the following and consider their importance and associated differences;

 

Strategy:

The science or art of military command as applied to the overall planning and conduct of large-scale combat operations.

Tactics:

The technique or science of securing the objectives designated by strategy, especially the art of deploying and directing troops, ships and aircraft in coefficient maneuvers against the enemy.

I submit that making this distinction is critical for healthcare revenue cycle and financial leaders. It is more than just semantics. The following illustrates its impact on how we approach things.

1. 
   
   Hiring:
   When asking job candidates interview questions about how they might handle certain situations or operating conditions, do you get a tactical response or a strategic answer? Perhaps if the candidate focuses mostly on tactics, you would consider them for different roles than if they provide more strategic responses.




2. 
   
   Managing Change:
   Your organization has acquired multiple facilities over the course of recent years and the question of centralized AR processing hits the table. Are you thinking about development of a strategic plan or are you speculating about how billing data will be transferred (and the multitude of other tactical challenges inherent in this initiative)? Unfortunately, businesses often “skip” strategic thinking and planning when addressing key opportunities. This often leads to the conclusion that the original idea was a bad one or that people have underperformed when the reality was simply that an absence of strategy caused a great idea to fail implementation.

So when you are considering a central business office, integration of physician billing, a computer conversion, a denial management plan, or any other initiative, develop and test a strategy before you leap into the tactical component.

We hope this and other practical experiences Nearterm has accrued over the recent 20 years will be of value to you. We have served in both strategic and tactical roles with our clients and we would welcome your call us at 281-646-1330 if you have questions.

How do healthcare financial management professionals influence employee focus?

We all want to contribute to the success of our respective organizations. A mentor of mine once imparted to me a simple management tenet that helped me over the years to do just that. He said, “Employees determine what is important based on how you spend your time”. Because my mentor was a brilliant healthcare leader and a great human being, I took this seriously and felt compelled to interpret his subtle advice. Here is what he really told me:

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  When people embrace importance, they act accordingly. In the workplace, when employees recognize that what they do is important and/or that their work will result in something important to their organization, they get engaged. This translates to creativity, harmony, efficiency, ownership and stability.


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  When people are asked to participate in tasks and activities that are not perceived as important, the result is very different, particularly in light of the generational diversity in the workplace today. If you want to test that, ask a GEN Y employee to do something without some explanation of purpose and why it is important. Or for baby boomers, a great example was the scene in the old movie “Cool Hand Luke” where a prisoner was repeatedly asked to dig a hole then fill it back in again to “break” him. It was not important and so the prisoner continued efforts to escape until his death, certainly not the behavior the warden was after.


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  The key question then, is how do employees determine what is important? It is less based on things like what a manager writes in a memo, what the manager says or posts on the wall. It is how the manager spends his/her time. Here are a couple examples:

1. In patient financial services, account documentation is an important part of the work process. In our revenue cycle consulting practice, we review work samples as part of our discovery process. That means looking at accounts. When we find absent or poor documentation and ask the business office manager about it, we find that they do not routinely look at a sufficient sample of accounts to have made the observation on their own. Employees no longer think it’s important so either discontinue writing up account history or do a hap-hazard job. Spend more time randomly reviewing account stratifications and discussing findings with employees. It becomes important and documentation improves.


2. Most hospital controllers and hospital chief financial officers would concur that maintaining logs is an important function. At the beginning of the fiscal year, they tell the accounting staff it is important and back it up with a memo or email. Fast forward as other priorities emerge over the course of the year. The CFO spends time working on the bond issue or the new building project and deploys the accounting staff accordingly. The accounting staff perceives those issues must be important and does a great job supporting those initiatives. Now it is time to do the cost report, the logs are summoned and we learn they have not been maintained since the second quarter. Nobody asked to see them or otherwise spent time on the logs all year.
3. The idea is to consider how you spend your time in the context of how your presence influences what people think is important. We can’t be everywhere and certainly there is nothing wrong with job descriptions, emails, memos, verbal direction and other communications. Just bear in mind that at the top of the communication hierarchy is “how you spend your time”.

In overview, you might want to reflect on how you have invested your time and presence over the recent month. Another effective way to assess what employees think is important is to ask them casually and privately, then listen carefully to what they say (not a survey that gives them a lot of time to construe what you want to hear in lieu of what they really think). Perhaps the result would represent an opportunity for you to rethink or fine-tune your management practices as I did.

Why you should consider using a search firm?

Over recent years, approximately two thirds of those hired in healthcare management positions were acquired through a search firm. Most hiring authorities and HR professionals are therefore acquainted with the significant differences among these firms and the various levels of service they provide. That said, there are a number of reasons healthcare provider organizations use search firms and the following is a brief summary you might find useful in confirming the value of such services:

• Search professionals help you access “hidden candidates”. These are candidates who are very happy in the current employment scenario. They typically do not have the time or interest to look at ads and they would not answer them if they did. They are not looking for jobs. Often, these are highly desirable candidates for obvious reasons. Through research and other techniques, competent recruiters identify and build relationships with hidden candidates on your behalf.
• Search professionals help you avert “sight seers”, people interviewing without serious interest or compatibility. This saves you considerable time, money and aggravation.
• Search professionals help you by bringing “confidence” in the probability that a candidate you are working with would accept the position if offered. Issues like compensation, relocation, family/personal matters and others are addressed by the firm before you advance too much time and energy in the process of considering the candidate.
• Search professionals uphold the highest standards of “confidentiality” in all they do. That allows them to conduct search activities inside your organization as well as individuals you have targeted outside of your organization but were reluctant to pursue directly for various reasons.
• Search professionals are experts in “on-boarding” and can assist you with this process. On-boarding is a critical element of a successful transition of the newly hired candidate into your organization. It is well documented that organizations that have adopted an active on-boarding process experience fewer failed hiring attempts.

The above is only a summary. If you would like to discuss this topic further or you have comments, please feel free to contact Nearterm at 281-646-1330.