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FINANCIAL COUNSELING BEST
PRACTICES
May 17, 2013
AAHAM SPRING MEETING
2
FINANCIAL COUNSELING BEST PRACTICES
Learning Objectives Describe the difference between “financial clearance”
and “financial counseling” Describe financial screening and counseling KPIs Understand the difference between “front-end” and
“back-end” counseling Understand when the financial counseling process should
begin Identify key financial clearance policies and procedures Describe the financial counseling process Show why application integration and automation is
dramatically impacting the counseling staffing model
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WHAT IS FINANCIAL COUNSELING?
You still use the term “charity program” You don’t determine patient payment responsibility
prior to service delivery for walk-in patients? Only certain employees are assigned to determine
patient payment responsibility? The person who does estimates or insurance
verifi cation is called a “fi nancial counselor”? Your “counselor” sometimes strays outside of your
written guidelines when approving fi nancial assistance?
You have a backlog of patients awaiting Medicaid approval so fi nancial assistance decisions are delayed?
Your counseling process has little integration or automation? Form completion is manual?
Does this sound like your organization?
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PERFORMANCE METRICS
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KEY PERFORMANCE INDICATORSCategory Standar
d
Collection of elective services deposits prior to service 100%
Collection of IP patient-pay balances prior to discharge > 65%
Collection of OP patient-pay balances prior to service > 75%
Collection of ED patient-pay balance prior to discharge > 50%
Screening of uninsured and underinsured patients for financial assistance > 95%
Payment arrangements for non-charity eligible patients > 95%
Prompt-payment discount percentage(s) 5-20%
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WHAT IS FINANCIAL COUNSELING?
How many in this session feel that you don’t have enough financial counselors to meet the key performance targets we just reviewed?
What if you were told that if you have 2 or 3 dedicated counselors, you probably have more than enough?
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WHAT IS FINANCIAL COUNSELING?
At many healthcare organizations, the answer to this question depends on the person or department that's asking….....
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“The way we see the problem is the problem”
Stephen R. Covey
WHAT IS FINANCIAL COUNSELING?
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DEFINITIONS
Self-Pay
Financial Clearance
Financial Counseling
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WHAT IS SELF-PAY?
Self-Pay • (Also referred to as
Patient-Pay)- That portion of the bill that is to be paid in part or in full by the responsible party from their own resources, as it is not payable by a third party (i.e. insurance carrier).
• This means that “self-pay” no longer simply refers to patients with no insurance coverage
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WHAT IS FINANCIAL CLEARANCE?
Financial Prerequisites (Financial Clearance) Assuring that all the
appropriate payers have been identified and requirements have been meet, and their has been communication with the patient about their financial obligations prior to service Source: NAHAM Patient
Access Continuum – CHAA Study Guide
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WHAT IS FINANCIAL COUNSELING?
Financial Counseling A “step in the billing
process during which credit is extended to self-pay patients”Michael Nowicki, The Financial Management of Hospitals and Healthcare Organizations
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WHAT IS FINANCIAL COUNSELING? Financial Counseling: A means of
providing financial education to help the patient understand his/her insurance coverage and financial responsibility for healthcare services
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WHAT IS FINANCIAL COUNSELING?
Financial Education components include: Informing the patient
of the hospital’s financial policies
Assessing the patient’s ability to pay
Reviewing payment alternatives
Achieving account resolution by helping the patient satisfy his or her payment obligations
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WHO IS RESPONSIBLE?
Financial counseling duties may be assigned to:General registration
personnelInsurance verification
specialistsDedicated counselors
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WHO IS RESPONSIBLE?
Counseling prior to billing:SchedulingPre-registrationWalk-in registrationEmergency
DepartmentScheduled
proceduresDecentralized
departments
Counseling after billing:Late paymentsDenied claimsQuestions or
dispute resolutionBad debt issuesBankruptcies,
Liens, etc.
Patient Access Counseling
Patient Accounts Counseling
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WHEN DOES COUNSELING START?
Tip: Since financial counseling situations will usually arise when patient payment responsibilities are identified, it is critical that access management personnel are prepared for their role in the financial counseling process.
Examples include: An uninsured patient wishes to receive services An underinsured patient is made aware of payment
responsibilities A managed care patient wishes to have unauthorized
services A Medicare patient wishes to have services deemed
medically unnecessary by national or local coverage determinations (NCD/LCD)
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WHEN DOES COUNSELING START? Tip: It is less costly for our customers
and our organizations if we collect self-pay or “patient pay” dollars prior to service, at the point of service or at discharge.
If “patient pay” dollars are not collected at the point of service or discharge, the cost-to-collect providers incur can range from 4% to 10% of the balance.
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Cost-to-Collect
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PAYMENT RESPONSIBILITY
A patient’s responsibility for payment begins on the date that services are rendered. Successful organizations set this expectation during the registration process before services are delivered.
How? By educating the patient on your financial policies!
When does payment responsibility begin?
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FINANCIAL PRACTICES POLICIES
Financial Practices policies of healthcare organizations should clearly state that:
Payment is expected on the date of service and
Emergency care will be provided without regard to a patient’s ability to pay
Financial assistance is available if you cannot afford to pay
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PATIENT FINANCIAL EDUCATION
Screening
Financial Practices
Financial Clearance
Verification of Payer Coverage
Up-Front Collections
Financial Screening:Activities an organization engages in to establish patient payment responsibility
Financial Counseling Policies
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PATIENT FINANCIAL EDUCATION
Counseling
Financial Assistance
Payment Plans
Waivers of Co-Payments and Deductibles
Self-Pay and Bad Debt Processing
Financial Counseling Policies
Financial Counseling:Activities an organization engages in to help patients meet their financial obligations
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PATIENT FINANCIAL EDUCATION
Screening
Financial Practices
Financial Clearance
Verification of Payer Coverage
Up-Front Collections
Counseling
Financial Assistance
Payment Plans
Waivers of Co-Payments and Deductibles
Self-Pay and Bad Debt Processing
Financial Counseling Policies
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ACCOUNT RESOLUTION
Account ResolutionInvolves
reviewing payment options in a controlled, sequential manner to move the patient to an acceptable resolution of the financial obligation.
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ACCOUNT RESOLUTION
Counseling Sequence
1. Greet the patient2. Review your financial
policies3. Review insurance
benefits if any4. Review expected
charges and calculations5. Review payment options
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ACCOUNT RESOLUTION
Payment OptionsFull payment no later
than the date of service
Short-term payment plans
Bank loan programsGovernment programsFinancial assistance
program
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ACCOUNT RESOLUTION
Payment OptionsFull payment no
later than the date of service
Including:CashCheckCredit CardElectronic Funds
TransferDate-limited
Prompt Pay Discount
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ACCOUNT RESOLUTION
Payment OptionsShort-term
payment plan
Features:Monthly paymentsInterest-freePlans are based on
propensity-to-payTimeframes don’t
crossover into bad-debt criteria
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ACCOUNT RESOLUTION
Payment OptionsBank Loan or
other Credit Programs
Features:Payment made
directly to hospital up-front
Patient maintains payment schedule with lending entity
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ACCOUNT RESOLUTION
Payment OptionsMedicaid
Eligibility
Design Options:Onsite state or
county workersOutsourcing FirmsInternal referrals to
state or county assistance
Streamlined process includes “presumptive approvals”
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ACCOUNT RESOLUTION
Payment OptionsHospital Financed
Assistance
FeaturesSliding scale
discounts% of Federal Poverty
GuidelinesUse of term “charity”
eliminatedStreamlined process
includes “presumptive approvals”
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FINANCIAL ASSISTANCE AUTOMATION
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A NEW DAY
Healthcare organizations are using a plethora of technologies to reduce costs and improve service delivery. When implemented as stand-alone applications as has often been the case with financial assistance applications, these organizations are experiencing bottom-line improvement. However, when implemented as components of a well-considered revenue cycle vision, the overall results can be greater than the sum of individual parts.
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APPLICATION EVOLUTIONApplications have evolved alonga fairly predicable path
While progress has occurred at every level,
transformation of work processes has been elusive
Transformed Level 4 (Integration leveraged between all applications)
Integrated Level (Integration improves with ADT Application
Batched Level (Some Batch and Direct Processing)
Niche Application Level (Application Silos are formed)
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FINANCIAL ASSISTANCE AUTOMATION
BenefitsProactively identify eligibility
to entitlement programsReduce unnecessary
outsourcing to self-pay vendors
Improve charity/bad debt classification
Improve customer service and community benefit reporting
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FINANCIAL ASSISTANCE AUTOMATION The Old Approach
Manual application and subjective approval processes
Reconciliation manual and cumbersome Features To Look For Now:
Pre-populate applications from ADT information Medicaid applications Financial assistance applications
*Integration with propensity-to-pay systems and e-pay systems Pre-define payment plans
Presumptive eligibility and approvals Automate financial assistance rules and
workflows 36
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THE VISION DILEMMA
“We don't see things as they are, we see them as we are.”
Stephen R. Covey
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A 4TH GENERATION VISION
Scheduling
Physician Self-Scheduling:
Clinical pre-cert edits applied
Patient Self-Scheduling:
Financial Screening edits
launch
Pre-Registratio
n
Automated home & email
address confirmation
Automated home & cell
phone verification
Eligibility
Scheduled service is verified: Payment
responsibility is determined
Automated estimate is instantly prepared
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A 4TH GENERATION VISION
Payment Calculatio
n
Instant-estimate includes
contract rates and site-specific
discounts
Pop-up patient-friendly
collection scripts available to registrar or
online to patient
Propensity-to-Pay
Propensity to pay determined using SSN, DOB
and contact information
All categories pre-approved
but “Can afford to pay but
doesn’t category”
Financial Counselin
g
Technology & scripting allow registrars to handle most
scenarios
Financial counseling
sessions auto-scheduled for
exceptions
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A 4TH GENERATION VISION
E-Cashiering
Payment estimates flow directly to e-cashiering application
Online pre-payment
processing for credit cards, e-
checks
Self-Payment Options
Patient is presented with pre-established payment plan
options
Patient may route directly to
a financial counselor (FC)
Exception Manageme
nt
Patients triggering site-defined edits, e.g., bad debt history, auto-route to FC
FC determinations auto-approve or auto-route for
manager approval
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THE NEW MATH
Transformational Performance
+ =+
Technology Accelerators
4th Generation
Vision
The Formula for Transforming the Financial Counseling Vision
Integration Between all Applications
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QUESTIONS?
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CONTACT INFORMATION
John Thompson, PMP, CHAM, CRCR
Principal, Access Management and
Technology Innovation Services
jthompson@coalitionrc.com(301) 802-3078
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