using business analytics to improve outcomes

Orlando Health is taking advantage of customized solutions to get its hospital and physician practice revenue cycle systems in synch and strengthen its organization operationally and financially.

With the complexity of today's healthcare environment, any steps that can be taken to eliminate redundancy and promote consistency will lead to improved clinical and financial outcomes and better customer experiences. The advantages are especially apparent when a provider's regional growth strategy includes the acquisition of physician practices.

Orlando Health is a classic example. The rapid growth experienced by this $2.1 billion, eight-hospital enterprise has enhanced its ability to deliver care. Since 2006, the Orlando Health Physician Group has grown from 70 to 500 employed physicians, but this growth has also presented significant organizational challenges.

Prior to being acquired, these practices had a wide variety of billing systems and revenue cycle processes in place. Strengthening the organization operationally required getting all 500 physicians on the same page while promoting the most effective and cost-efficient administrative practices. Strengthening the organization financially required understanding each physician's contribution, and sharing information and workflows between the hospital and physician central business offices (CBOs).

The Scope of the Challenge

The value of Orlando Health's solution becomes clear if one understands the scale of the health system's challenge. The organization operates two separate revenue cycle systems: a health information system (HIS) that manages hospital accounts receivable (A/R), and a practice management system that handles professional A/R. The two systems share information through systematic interfaces. Because services rendered by employed physicians in the acute hospital setting account for 48 percent of Orlando Health's physician enterprise professional revenues, it was critical to gauge how much revenue was being generated by the employed physicians on the hospital side of the organization. It also became clear that integrated backend revenue cycle workflows needed to be created and implemented, where possible, to improve charge capture, reduce billing edits, and improve productivity while enhancing the patient experience in the revenue cycle.

For the past three years, a customer- and quality-focused internal initiative has emphasized making patient satisfaction a priority. Orlando Health hospital staff work to deliver a high-quality experience, including exemplary billing services that promote patient satisfaction by fully addressing patients' concerns and expectations. In this effort, it stands to reason that simplified billing plays an important role.

The Role of Business Analytics

Bolstering the effort to ensure patient satisfaction is a set of custom analytics for physician performance, patient-pay segmentation, revenue management, and enterprisewide management. The physician enterprise's CBO management team created a set of tracking metrics to help practices more closely monitor their performances. Working with finance, the team combined hospital data with physician data to measure revenue generated by employed physicians across the system. Through joint efforts between the physician group and hospital CBOs, alerts and workflows were created to notify collection teams of actions taken on a patient account when an account is generated in the other system-enabling a direct link between two disparate HIS platforms.

Physician performance. The physician performance analytics solution provides a combined revenue cycle data-mining platform that calculates the total contribution margin for every employed physician in the Orlando Health Physician Group. The platform contains data from the revenue management system and the finance cost-accounting system, and is able to compile the professional revenue for a hospital stay and compare it with the corresponding hospital revenue based on admission and discharge dates.

With this solution, the organization's two CBOs communicate and share information on a daily basis. Orlando Health thus knows precisely each physician's contribution margin-not just for professional services, but for all services billed by the hospital for each of that physician's patients.

The old system tracked physician practice performance on a paper-based scorecard that was updated monthly, processed, and emailed to each office. Today, online scorecards are updated daily, giving office managers and physicians current data with which to measure their progress toward goals and to quickly identify underlying issues.

Information is disseminated to all concerned parties via an enterprise analytics platform. Stakeholders can see the performance of the entire organization-or of their own office, or themselves individually-with only a few clicks.

Patient-pay analytics. The patient-pay segmentation analytics solution is a work list shared by the CBOs of the hospital and the physician group. The solution calculates financial risk and applies scores to a patient's hospital and physician account balances. Because the hospital and physicians use the same scoring algorithm, charity and bad debt write-offs are consistent across all physician practices and hospitals under the Orlando Health corporate umbrella.

Combining advanced analytic capabilities with the efficient application of specific organizational business rules, this solution can perform the charity prescreening function and highlight patients who likely qualify for a charity write-off in accordance with Orlando Health guidelines.

Denied claims are another area where advanced analytics quickly led to favorable outcomes. In 2013, an issue arose with Medicare and Medicaid patients who had switched to a managed care government product. Claims were being billed to the traditional government program and subsequently denied, and claim edits were not resolving the situation. Orlando Health implemented new edits that required another eligibility check for these patients, and denials were cut significantly: Doubling the prebilling edits on the front end has reduced back-end denials by 36 percent and monthly eligibility denials by 20 percent. Analyzing and tracking the causes of denials and the triggered claim edits made this improvement possible.

Today, office staff are fully conversant with new billing systems that accurately account for the scheduled treatments and procedures, and are able to access and use these systems each time a patient presents. The systems allow Orlando Health to focus more clearly on the initial stages of its interactions with patients and on ensuring the integrity of the data entered into source systems.

A daily report shows the volume and charges associated with all edits that are outstanding and in need of being addressed by each office location before the bill can be generated. This report helps to clarify for office staff the importance of performing these edits quickly and generating the invoice. Wasted effort is greatly reduced as office staff come to see how the work involved in generating a correct 837 transaction for a payer on the first try is minimal compared with the work involved in processing a subsequent denial, rebilling, and manually monitoring the denial, with hopes that it will be overturned.

Revenue management and enterprise management analytics. In addition to the physician performance and patient-pay segmentation analytics, which act as point solutions, Orlando Health implemented analytics for revenue management and for enterprise management, which serve broader functions.

The web-based, data-mining revenue management solution provides the physician group with a transparent platform for both the back-end CBO team and the front-office managers and administrators, giving them access to information whenever they need it. Bridging this gap between the two groups has led to heightened awareness of revenue cycle challenges and to better collaboration about ways to meet those challenges. Working together, these two groups have achieved significant success that enhances both ends of the professional revenue cycle. An example is the significant reduction in registration-related denials thanks to improved tracking of prior patient history through the analytic solution. Patient history can be easily queried for past insurance coverage and payment history. In addition, a dedicated physician liaison team is standing by to assist practices by phone.

Orlando Health also takes advantage of the built-in interoperability of the health system's enterprise analytics platform. Although the hospital and physician businesses have their own source systems and business staff, the platform allows the two sides to share important information about common patients. For example, if the hospital performs a charity review and authorizes a write-off, the physicians will be notified as soon as a physician invoice for the patient is generated. This approach to work-listing shows a collector that a patient's case has already been reviewed by the other business office, thereby eliminating redundant work and ensuring that the patient receives consistent, well-coordinated care across the entire Orlando Health enterprise. The benefits of this approach include operational efficiency and improved patient satisfaction, which are critical in a competitive market.

Big-Picture Benefits

Orlando Health's physician enterprise avoids approximately $22.7 million a year in bad debt write-offs, and attributes at least 62 percent of that amount to its analytics platform.

Orlando Health anticipated such benefits after implementing its custom suite of analytics, although the returns were higher than expected. Unforeseen benefits include the ability to measure physician performance daily and the availability of online scorecards that give managers far greater control. The organization converted the scorecards from a monthly paper or emailed PDF format to a daily online version that provides instant information and easy-to-understand breakdowns, allowing the physician practices to have instant access to their data and nearly real-time insight into their performances. Questions about high-level metrics on the scorecard can be easily understood through click-to-drill queries. In addition to the online scorecard, the professional services CBO is able to provide practices with a set of standard management reports, through which all activity from the practice to the CBO can be viewed and monitored. Alerts support the ability to monitor critical metrics and to be warned when a metric has deviated from an expected range.

What Every Provider Can Learn

When managing patient populations, as Orlando Health does, knowledge translates to dollars. Bringing operations on both sides of the house into sharper focus is a complex undertaking, but the combination of physician performance analytics and patient-pay segmentation meets the challenge effectively, especially when the focus is on achieving enterprisewide collaboration.

The more efficiently all members of the team- from neurosurgeons to collectors-can be put on the same page, the better the financial and operational outcomes for the organization. Whatever solution a health system chooses, the primary goal should be to establish common habits, policies, and practices that benefit eveiyone. To this end, two key considerations should drive the decision: The solution should respect health system staff's diverse needs and give them exactly what they need to perform, and all the components of the solution should be internally consistent and interoperable.

Regardless of setting, revenue is revenue and cost is cost. Each should be measured using the same set of calipers for the physician practice and the hospital.

It also is vital to recognize that each organization will have unique circumstances, and that no single solution will work for all organizations. Each organization should carefully identify and review its specific needs and key performance indicators, and should strive to ensure that its approach to business intelligence and data analytics is flexible to account for those unique requirements.

Organizations should further keep in mind that although lagging indicators are valuable, forward-facing and predictive analytics that present leading indicators and offer actionable workflows will be increasingly critical to remaining competitive in the evolving healthcare marketplace. Some examples of leading indicators and workflows used in Orlando Health's physician enterprise include:

* Ratio of conversion rate to final-billed

* Overall insurance verification rate of scheduled patients

* Collector productivity scores

* Charity-eligible workflow

* Cross-system charity write-off flags

Most important, the more efficiently health systems manage their hospitals and physician practices, the better for their patients. When healthcare providers deliver the best possible care to their patients, and are able to enhance the total patient experience with exemplary billing practices, the patients benefit-and so do the providers.

AT A GLANCE

Orlando Health has brought its hospital and physician practice revenue cycle systems into better balance using four sets of customized analytics:

* Physician performance analytics gauge the total net revenue for every employed physician.

* Patient-pay analytics provide financial risk scores for all patients on both the hospital and physician practice sides.

* Revenue management analytics bridge the gap between the back-end central business office and front-end physician practice managers and administrators.

* Enterprise management analytics allow the hospitals and physician practices to share important information about common patients.

See examples of tools Orlando Health uses to track physician performance and patient-pay status at hfma.org/orlandohealthtools.

About the authors

Jose Rivera

is corporate director, professional services, Orlando Health, and a member of HFMA's Florida Chapter (jose. [email protected]).

Stephen Delaney

is senior vice president, client solutions, VisiQuate, Inc., Nashville, Tenn., and a member of HFMA's Tennessee Chapter ([email protected]).