Our inaugural post, “Healthcare of the Employee vs. Health of the Business: What If No One Wins?,” takes a look at “this uncomfortable positioning of the healthcare of the employees against the health of the business that remains when we talk about healthcare reform in this country.”

As Mike Bevel points out at the beginning of the piece, there are unlikely to be any quick and easy answers in how to reconcile the needs of small business with the needs of employees and affordable healthcare. This doesn’t mean we shouldn’t think about it and question pretty much all sides of the issue, though.

We hope you’ll join us.

The post insidePatientFinance on Forbes: When It’s Employees vs. Business, Is There Really a Winner? appeared first on insidePatientFinance.

Several analysts and news organizations have published their big picture forecast for the healthcare industry as a whole (one of the best was updated today by Kaiser Health News). But what about those with specific concerns; in this case, for patient financial services professionals? What challenges and opportunities will an unfettered implementation of the Affordable Care Act present over the next several months?

Of concern are the proposed rules by the Internal Revenue Service to restrict how not-for-profit hospitals collect from low-income patients. The rules clarify IRS regulations regarding how a hospital manages its financial assistance policy (FAP) and emergency medical care policy, and how it collects debts from patients who may qualify for financial assistance or charity care. The most onerous regulation, at least to hospitals, is a prohibition of up to 240-days on providers from reporting low-income patients to credit bureaus for non-payment of bills.

The current IRS regulations require nonprofit hospitals to make a “reasonable effort” to determine if a patient qualifies for financial assistance. When those regulations were first published, many healthcare organizations asked what constitutes “reasonable effort.” Earlier this year the Treasury Department issued regulations that spell out “reasonable.” A hospital must provide any patient who might qualify for charity care with a 120-day “notification period” that commences with the first bill during which the hospital must communicate its financial assistance policy. This must be followed with another 120-day “application period” during which the patient is allowed to submit a financial assistance application. Only after these two periods have expired can a hospital engage in “extraordinary collection actions.”

The US Treasury Department has scheduled a hearing on the rules for Dec. 5. Today is the last day to register to testify on the proposed rules (anyone interested in speaking must contact Oluwafunmilayo Taylor at (202) 622-7180 before the close of business today).

Several healthcare associations have already registered their protest over the proposed regulations, which could hamstring not-for-profit hospitals by restricting the ability to collect legitimate fees for service in a timely manner. Collections is a time-critical function — the longer a debt is unpaid, the lower the chances of the debtor to collect.

After the hearing, the IRS will either revise the rules or not, and then publish them, at which time they will take effect. While there is no timeline for implementation, it is expected to be before the end of the year, according to IRS staff.

Electronic Transfer Rules

What the federal government taketh away when it comes to collecting from patients, it giveth back in the form of simplifying reimbursement collections from insurers.

Because every insurer has its own data schemes and formats for how providers submit claims, it creates a bureaucratic jungle that consumes tremendous human capital. The Centers for Medicare and Medicaid Services, under authority of the ACA, have published rules that establishes standards for EFTs and health care payment and electronic remittance advice (ERA).

By creating data standards for EFTs, ERAs, and for insurers, healthcare providers and their financial institutions can reduce or eliminate paper-based payment systems and manual business processes. With data standards in place, payment systems between insurers, providers, and financial institutions can better communicate and process transactions electronically.

Previously:

Insurer, Healthcare Provider Electronic Transfer Rule Comment Period Closes

Hearing Postponed on Federal Regulations for Hospital Debt Collection

Associations Find Proposed IRS Regs for Health Collections Burdensome

Treasury, IRS, Release Details of Hospital Debt Collection Regulations

Download copies of the IRS collection regulations, revisions, and meeting notices below (ZIP file):

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The post Obamacare Wins Second Term — What’s Ahead? appeared first on insidePatientFinance.

In June the US Treasury Department released the the proposed rules that clarify IRS regulations regarding how a hospital manages its financial assistance policy (FAP) and emergency medical care policy, and how it collects debts from patients who may qualify for financial assistance or charity care. The comment period for those proposed rules expired Monday, and among those heard from were the Healthcare Financial Management Association (HFMA), representing 39,000 healthcare financial professionals, and the Association of Credit and Collection Professionals (ACA International), with 5,000 member collection agencies.

The proposed regulations will impose significant burdens on not-for-profit hospitals, HFMA said, because of “duplicative or conflicting procedures and requirements, burdensome processes and record keeping,” and “inconsistent standards and unintended consequences.”

Just to implement the new regulations will require non-profit hospitals to spend between 250 and 2,700 hours annually to implement the new requirements, the organization said. “The rules will require hospital organizations to execute numerous actions that will easily exceed this estimate,” the HFMA letter said. “The rule will be far more costly for organizations to comply than what IRS may have contemplated.”

ACA International questioned the Treasury Department’s jurisdiction for some of the proposed regulations. ”Under the Fair Debt Collection Practices Act, Congress expressly prohibited the promulgation of regulations ’with respect to the collection of debts’ with limited exceptions that do not apply here,” wrote ACA International. “The proposed regulations will regulate the manner and method of collection healthcare debts. Although unclear from the notice of proposed rulemaking, the Agencies may intend to limit the application of the Proposed Regulations to the internal billing and collection operations of charitable hospitals, as opposed to independent third-party collection agencies servicing healthcare debts for charitable hospitals.”

ACA International also “believes that the proposed regulations would be strengthened by several clarifications and modifications,” the collection agency organization wrote. “These changes aim not only to improve patients’ experiences in eligibility determinations and reduce the risk of confusion between inconsistent and duplicative federal, state, and local charity care requirements with profound implications for continued non-profit status, but they also recognize the shared responsibility of healthcare providers, payers, and patients in making timely financial assistance eligibility determinations.”

The proposed regulations clarify IRS regulations regarding how a hospital manages its financial assistance policy (FAP) and emergency medical care policy, and how it collects debts from patients who may qualify for financial assistance or charity care.

Overall, ACA International found that the proposed regulations “conflict with state and local charitable care and financial assistance laws … The solution to this problem is for the final rule to clarify that the federal standards preempt state law.”

The 240-Day Debt Collection Window

The section of the proposed regulations generating the most comments are those related to debt collection. Under the current IRS regulations nonprofit hospitals are required to make a “reasonable effort” to determine if a patient qualifies for financial assistance. The proposed regulations define what “reasonable” means. A hospital must provide any patient who might qualify for charity care with a 120-day “notification period” that commences with the first bill during which the hospital must communicate its financial assistance policy. This must be followed with another 120-day “application period” during which the patient is allowed to submit a financial assistance application. Only after these two periods have expired can a hospital engage in “extraordinary collection actions.”

“To add a second 120-day application period during which a hospital’s ability to engage in any collection actions that require a legal or judicial process may be suspended is extremely detrimental to a facility’s ability to recover from patients with resources available to pay the amounts due,” HFMA wrote. “In addition, the Fair Debt Collection Practices Act (FDCPA) already allows 30 days after a person has been notified of a debt to respond and dispute that the debt is valid. Therefore, we strongly urge that the application period be removed from the regulations, allowing hospitals to commence ECAs without further delay following expiration of the 120-day notification period. We also recommend that the FDCPA’s 30-day notice for validation of debt be applied after the provider turns an account over to a third-party collection agency. Additional periods are unnecessary.”

ACA International concurred. “The 120-day notification and 240-day application periods are too long, conflict with state requirements, and unreasonably interfere with the ability of charitable hospitals to recover payments from patients who are ineligible for financial assistance,” the association wrote. “This result finds no support in the Affordable Care Act and it was not the intent of Congress.”

HFMA wrote that this regulation will mean putting a 120-day timer on all bills, which will have to be implemented only a great cost.

If the Treasury imposes a waiting period on collections, ACA International has requested that it be considered a tolling period. Tolling periods are those where the statute of limitations on a debt stops running. “The proposed regulations should state that the notification and application periods toll the applicable statutes of limitations to credit report and commence a lawsuit to recover the debts from patients ultimately determined to be ineligible for any financial assistance,” wrote ACA International.

Extraordinary Collection Actions

The proposed regulations also define what actions are considered ‘‘extraordinary collection actions’’ and the ‘‘reasonable efforts’’ a hospital facility must make to determine FAP-eligibility before engaging in such actions.

“The focus of the regulation is on the patient completing an application for financial assistance,” wrote HFMA. “In reality, this is an area that consumes considerable resources and produces significant frustration for hospitals because of patients’ reluctance or unwillingness to provide complete and timely information.”

The organization argued that “if hospitals can document that they have taken the required steps to verify eligibility but have not had the cooperation of the patient in providing the information requested in a timely manner, or are unable to establish presumptive charity from other records, they should be deemed to have satisfied the requirement of ‘seeking to determine whether an individual is financial assistance policy (FAP)- eligible.’”  HFMA listed several methods, such as public record searches, to establish this.

The IRS could also help in this, according to HFMA, which recommended agency streamline the process for obtaining a patient’s adjusted gross income by making it online and automated, rather than the current method of faxing a request.

ACA International recommends the Treasury require patients to cooperate with eligibility determinations. “ACA International suggests that the proposed regulations acknowledge that a patient seeking eligibility for financial assistance has an affirmative duty to cooperate in the process.”

Reporting to Credit Bureaus 

Under the proposed refinement of the regulations, reporting a patient’s delinquent debt to a credit bureau would now be considered an “extraordinary collection action.”

“Credit reporting of a healthcare debt is not “extraordinary” and equating it on par with lawsuits, garnishment of wages, causing an arrest, and foreclosure actions is an arbitrary and capricious interpretation of the intent of Congress,” wrote ACA International.

In addition, the new regulations would also include a prohibition of selling a patient’s debt to a third party as an extraordinary collection action. While a not-for-profit hospital can contract with a third-party to collect a debt, the proposed regulations forbid it from selling that debt until it has determined definitively that the debtor does not qualify for financial assistance.

The list of extraordinary collection actions also includes, but is not limited to:

• Placing a lien on an individual’s property;
• Foreclosing on an individual’s real property;
• Attaching or seizing an individual’s bank account or any other personal property; Commencing a civil action against an individual;
• Causing an individual’s arrest;
• Causing an individual to be subject to a writ of body attachment; and?
• Garnishing an individual’s wages.

HFMA argues that not-for-profit hospitals are being singled out regarding the proposed regulations concerning “extraordinary collection actions.” “Unless the federal government plans to consider such methods extraordinary for all not-for-profit organizations (e.g., universities, FQHCs, etc.), we believe that these methods, which are all routine and normal actions, should be excluded from the definition of ECAs,” HFMA wrote. “Defining one set of requirements for not-for-profit hospitals and a different set for other not-for-profit organizations creates inconsistency within the standards to which organizations are held accountable under section 501(c)(3) of the Code. ”

Financial Assistance Policies

The proposed regulations also specify what information a hospital  must include in its financial assistance policy and emergency medical care policy, as well as the methods a hospital facility must use to publicize these policies.

HFMA wrote that these regulations will be burdensome and duplicative because it would mean in many cases completely rewriting a financial assistance policy or policies that member organizations have already invested tremendous time and resources to put into place. “Rather than requiring a rewrite of these policies, the regulations should give hospital organizations the flexibility to incorporate these policies by reference into a consolidating policy,” HFMA suggests.

“Multihospital organizations, for example, should be able to adopt system-level policies meeting section 501(r) requirements that qualify as compliant policies for the individual hospitals within the organization,” writes HFMA.

In addition, the proposed emergency medical care policiy requirements both duplicate and conflict with federal Emergency Medical Treatment and Labor Act (EMTALA) requirements, HFMA wrote. “When EMTALA obligations have been met and a patient is being discharged, it is customary to discuss financial responsibility and financial assistance, including responsibility for co-pays or deductibles. As written, the proposed rule could prohibit this interaction from occurring. This interaction is a key opportunity for hospitals to interact with their patients in regard to guidelines of their FAP as well as eligibility and application,” HFMA wrote.

Also, FAP policies can be several pages long and much of it in language that would only confuse a patient. HFMA suggests that hospitals be allowed to condense it into a single, easy-to-understand page.

How a hospital facility determines the maximum amounts (that is, the amounts generally billed – AGB — to individuals who have insurance coverage) it can charge FAP-eligible individuals for emergency and other medically necessary care. In the case of an individual who is FAP-eligible but has not applied for financial assistance at the time charges are made, the proposed regulations provide that a hospital facility will not fail to satisfy section 501(r)(5) if it charges the individual more than AGB, provided the hospital facility is complying with all the requirements regarding notifying individuals about the FAP and responding to applications submitted, including correcting the amount charged and seeking to reverse any extraordinary collection actions previously initiated if an individual is later found to be FAP-eligible.

“That requirement is very burdensome for hospitals to perform,” wrote HFMA. “Calculated discounts will not vary materially for medically necessary versus elective or non-medically necessary care. It would thus be preferable to base the calculations on all claims and all charges.

“The final regulations should confirm that hospitals may continue to offer assistance to the insured, at their discretion, through their financial assistance policies and clarify that the AGB does not apply to assistance for the insured,” HFMA wrote.

The post Associations Find Proposed IRS Regs for Healthcare Collections Burdensome appeared first on insidePatientFinance.

When the Minnesota attorney general’s office came after Accretive Health earlier this year for allegedly engaging in strong-arm collection tactics, the company maintained that no Accretive employee was directly involved, and by implication, it was Fairview staff who reportedly engaged in attempting to collect fees from patients who were receiving treatment in the emergency room and other perceived violations.

Even after settling with the attorney general in July for $2.5 million, Accretive repeated its claim that none of its employees were engaged in the actions for which it was accused. Now one of the hospitals in the Fairview system, the University of Minnesota Medical Center, has come under scrutiny by the Centers for Medicare and Medicaid Services (CMS) for failing “to protect and promote each patient’s rights to be free from all forms of harassment when the hospital utilized aggressive payment collections tactics at the point of patient care,” the Star Tribune investigation found.

According to officials quoted in the news story, CMS will not impose sanctions provided the medical center agrees to take corrective measures, which hospital officials say it has already begun to do.

In addition to determining that staff at the medical center had engaged in aggressive collections, regulators also found that the hospital failed to respond promptly to patient grievances and violated EMTALA (Emergency Medical Treatment and Active Labor Act).

Fairview told the Star Tribune that it intends to be in “full compliance” with CMS’s corrective action plan.

The post Report: Minnesota Medical Center Tagged for Federal Violations over Collections appeared first on insidePatientFinance.

The Times story, which weighs in at more than 4,000 words, traces HCA’s formation, its early struggles and indiscretions, and examines the reasons behind its impressive growth and margins over the last several years. Today HCA is a chain of 163 hospitals and more than 100 surgery centers generating revenues of nearly $35 billion. And much of its success, according to the Times, lies within its patient financial services policies and procedures.

Increased reimbursements

HCA went from cheating the reimbursement system to beating it. In the 1990s it earned notoriety after receiving one of the largest fines for fraud in Medicare history, $1.7 billion. “Among the secrets to HCA’s success: It figured out how to get more revenue from private insurance companies, patients and Medicare by billing much more aggressively for its services than ever before,” writes the Times.

The newspaper conducted an analysis of HCA’s Medicare reimbursements and found that the chain was lagging far behind the national averages of patients who are classified among the two highest reimbursement categories under Medicare. By adopting the evaluation and management guidelines from the American College of Emergency Physicians and employing the corresponding coding procedures among its collective emergency rooms, the company was able to not only bring its Medicare-classified patients up to the national average, it surpassed it, and in the process increased revenue by 7 percent.

“The system uses interventions, like IVs and cardiac monitoring as a proxy for the acuity of the patient and the resources involved in the evaluation and management of the patient,” HCA writes in a statement prepared in advance of the Times article. “We implemented this system, which is used by many hospitals, because it provides for greater consistency and simplicity than the point system HCA had previously used. We know of no better organization than the American College of Emergency Physicians to establish a model that provides a national standard for more consistent classification of emergency visits for reimbursement purposes. After several years of using this model we believe our classifications are generally consistent with national averages.”

According to the Times, HCA found the new coding methodology to be too successful. “Behind the scenes, however, HCA executives said they realized the new system was causing too many of its patients to land in the highest-paying categories,” the Times writes. “HCA’s head of ethics and compliance, Alan R. Yuspeh, said in a telephone interview last year that the company had identified the problem shortly after introducing the system and changed it to bring the company in line with the national average.”

The takeaway for any healthcare provider is that it is worth the time to analyze how your respective facility rates among the national averages for patient classifications and reimbursements, and if you find that you are trailing behind the pack, figure out why and what you need to do to catch up. Insurers, Medicare, and Medicaid are numbers games, and as HCA found, there is plenty of wiggle room in coding methodologies.

Reducing emergency room abuse

The Times also found that HCA hospitals are vigilant in the emergency room about treating only emergencies. “Patients whose ailments were not deemed urgent were told to go somewhere else, like a free clinic, or that they could be treated if they paid the co-payment for their insurance or around $150 in cash,” the Times writes.

HCA, however, maintains that the Times places too much emphasis on its pre-screening procedures. “Many ERs in America have adopted a variety of systems to determine when a patient in fact needs emergency care,” HCA says in a prepared statement. “About half of HCA affiliated hospitals have done so and they typically have two caregivers, usually a triage nurse and a physician, make that determination. In 2011 HCA affiliated hospitals had 6,143,500 ER visits. Of that number, 80,000, or only about one in 100, were determined not to have an emergency condition, were offered information on more appropriate care settings and chose to seek alternative options.”

To read the entire New York Times article, click here.

To read HCA’s response, written in advance of the article, click here.

The post NY Times Finds Secrets to HCA’s Success in Patient Financial Services appeared first on insidePatientFinance.

EDITOR’S NOTE: As the director of content for insidePatientFinance.com, I read and follow a host of vital conversations in the healthcare industry. One of those important discussions involves the balance between delivering quality care while at the same time managing a business. The “core competency” of doctors (as a profession) is to make people well, to treat illness, and to improve quality of life. And doctors have their hands full just doing that. So your core competency and training—even as you’re running a business—is not all of the business-related minutiae. Or at least it can’t be your first priority. But you still need all those business elements to function efficiently in order to continue to provide the best care for patients.

The piece below originally appeared in the June edition of The DECA Relay, a monthly newsletter for healthcare finance professionals. You can access an archive of past Relay newsletters from DECA Financial Services’ Blog or by clicking here. I think Dr. Mulvey, a practicing emergency physician, approaches that balance in an intelligent and genuine way.

Michael R. Klozotsky, Chief Content Officer
insidePatientFinance.com – @insidePF

***

By Dr. Andy Mulvey, MD FACEP

The growing consensus among emergency physicians is that we are sailing the Healthcare ship into the perfect storm. Rising ranks of government patients and reduced commercial payers are resulting in declining patient revenues. Physician shortages in our specialty create growth and recruiting challenges while driving up compensation rates. Finally, the ranks of the uninsured continue to grow as we see steady, high unemployment. As a result, many emergency physician practices are facing an uninsured patient population that has risen to one quarter or even a third of their total billable visits. I have seen this expanding problem first-hand as part of a small, independent emergency physician group. We were experiencing tremendous downward pressure on group revenues while having to pay more just to recruit and retain enough providers to keep our contracts.

In this era of healthcare, patient collections can no longer be looked at as a side item to augment group profits. Rather, collections are now a critical component of accounts receivable recovery and hold the key to the long-term health of so many emergency physician practices. Unfortunately, this is not an area of expertise for most groups and the billing companies we partner with fail to address the bad debt. To them, bad debt is costly, inefficient, and not worth their effort going after. They want to grab the low fruit with electronic billing for government and commercial payers and then outsource the remaining accounts receivable to collection agencies that charge a large fee and often underperform.

This paradigm creates unique challenges for emergency physicians as we try to have to balance the need for strong collection services while still treating our patients with respect. Can we find a way to improve revenue from patient copays, deductibles, and the uninsured while recognizing our duty to treat and our professional responsibility as physicians? How can we retain some control of the collection process when these patient accounts are outsourced and we lack an understanding of the entire operation?

I believe the key component to a successful collections model for emergency physician groups is to become more engaged in the billing and collection process. We can’t just turn over patient charts and wait a few months for our ninety-five dollars to arrive. How many physicians/groups don’t even know how our patient collections are handled and who is doing it? Like anything else in life, if we get more involved we can obtain more control and hopefully better results.

This is exactly what we did in my group and the payoff was significant. We discussed the process with our billing company and interviewed several collection company vendors. After gaining a clear understanding and approval for the collections process, we selected a company that we felt provided the best fit for the culture of our group. Over the next year, we realized a several percent increase in patient collection revenue, a large payment from old bad debt just sitting on our books, and more influence in how the patients themselves were handled on our behalf.

Nobody expects emergency physicians to become experts at billing and collections. However, as we face growing economic pressures, the difference between success and failure will be in how engaged we become in the financial operations of our business.

• Call your billing company,
• ask some questions about their mechanism for handling bad debt,
• most importantly: select your own collections vendor.

We balance so many responsibilities as practicing emergency physicians, yet we cannot ignore the twenty or thirty percent of our practice revenue which goes to collections. Managing this piece well will allow you to feel better not only as a physician, but as a business owner.

Dr. Andy Mulvey is an actively practicing emergency physician who recognizes the importance of the science, art, and business of medicine.

The post Medical Debt Collection: an Emergency Physician’s Perspective appeared first on insidePatientFinance.

Those interested in commenting on the proposed regulations have until September 24.

A copy of the proposed regulations and accompanying explanations, some 24 pages, can be downloaded here.

The proposed regulations describe:

• What information that a hospital facility must include in its financial assistance policy and the methods a hospital facility must use to widely publicize its FAP.
• What a hospital facility must include in its emergency medical care policy.
• How a hospital facility determines the maximum amounts (that is, the amounts generally billed – AGB — to individuals who have insurance coverage) it can charge FAP-eligible individuals for emergency and other medically necessary care. In the case of an individual who is FAP-eligible but has not applied for financial assistance at the time charges are made, the proposed regulations provide that a hospital facility will not fail to satisfy section 501(r)(5) if it charges the individual more than AGB, provided the hospital facility is complying with all the requirements regarding notifying individuals about the FAP and responding to applications submitted, including correcting the amount charged and seeking to reverse any extraordinary collection actions previously initiated if an individual is later found to be FAP-eligible.
• What actions are considered ‘‘extraordinary collection actions’’ and the ‘‘reasonable efforts’’ a hospital facility must make to determine FAP-eligibility before engaging in such actions.

The proposed regulations also include definitions of ‘‘hospital organization,’’ ‘‘hospital facility,’’ and other key terms.

The 240-Day Debt Collection Window

The section of the proposed regulations generating the most interest are those related to debt collection. Under the current IRS regulations nonprofit hospitals are required to make a “reasonable effort” to determine if a patient qualifies for financial assistance. The proposed regulations define what “reasonable” means. A hospital must provide any patient who might qualify for charity care with a 120-day “notification period” that commences with the first bill during which the hospital must communicate its financial assistance policy. This must be followed with another 120-day “application period” during which the patient is allowed to submit a financial assistance application. Only after these two periods have expired can a hospital engage in “extraordinary collection actions.”

Under the proposed refinement of the regulations, reporting a patient’s delinquent debt to a credit bureau would now be considered an “extraordinary collection action,” as it currently is in some states.

In addition, the new regulations would also include a prohibition of selling a patient’s debt to a third party as an extraordinary collection action. While a not-for-profit hospital can contract with a third-party to collect a debt, the proposed regulations forbid it from selling that debt until it has determined definitively that the debtor does not qualify for financial assistance.

The list of extraordinary collection actions also includes, but is not limited to:

• Placing a lien on an individual’s property;
• Foreclosing on an individual’s real property;
• Attaching or seizing an individual’s bank account or any other personal property; Commencing a civil action against an individual;
• Causing an individual’s arrest;
• Causing an individual to be subject to a writ of body attachment; and?
• Garnishing an individual’s wages.

As mentioned previously, the deadline for commenting on these proposed regulations is Sept. 24, 2012. Comments can be mailed to CC:PA:LPD:PR (REG–130266–11), room 5203, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044. Comments can also be presented in person during regular business hours (Monday through Friday, 8 am to 4 pm) to CC:PA:LPD:PR (REG–130266– 11), Courier’s Desk, Internal Revenue Service, 1111 Constitution Avenue NW., Washington, DC. Those wishing to submit their comments electronically can do so via the Federal eRulemaking Portal at http://www.regulations.gov (IRS REG– 130266–11).

The post Treasury, IRS, Release Details of Hospital Debt Collection Regulations appeared first on insidePatientFinance.

As healthcare providers work to reduce days A/R and boost cash flow to cover operating expenses, they are aided by a network of third-party service providers—like billing companies, contingency debt collection agencies, and revenue cycle management firms—that partner with them to recover delinquent patient accounts. Professional Medical Billing (PMB), headquartered in Fort Wayne, Indiana, is a specialized reimbursement management company that serves independent, fee-for-service emergency physician groups. Like the physicians it supports, PMB was stymied by economic conditions that made the collection of past-due medical receivables on behalf of emergency physician groups an arduous task.

PMB engaged DECA Financial Services, a nationally licensed healthcare collection agency, to evaluate its clients’ delinquent healthcare accounts, assess the in­ternal collection processes in place, and partner with PMB to develop an analytics-driven solution to improve outside collection returns.

DECA Financial Services and insideARM.com have just published a new Case Study on the various organizational challenges that healthcare providers and their recovery specialist partners face in today’s economy.

In the initial phases of the campaign, DECA Financial Services identified a number of barriers to PMB’s clients’ success, including:

• Significant increases in the number of overdue emergency medical bills
• Self-funded plans that had run out of money
• Inadequate skiptracing solutions
• Ever-changing eligibility for employer-sponsored, private market, and government health plans

The Case Study, entitled Increasing Outside Medical Collections for Emergency Physician Groups, examines healthcare collection challenges from three angles: broad trends in U.S. economy impacting healthcare collections, technological inexperience or deficiencies related to right-party contacts (RPCs), and internal resource limitations impeding stated liquidation objectives.

During the course of the engagement, DECA Financial Services was able to increase PMB’s clients’ outside collection re­turns by 50 percent over the entire prior year’s results in only six months.

To learn more about the specific objectives DECA Financial Services successfully achieved for PMB and its clients, click here for a free download of Increasing Medical Collections for Emergency Physician Groups.

Michael Klozotsky is the Chief Content Officer at insidePatientFianance.com and insideARM.com. Follow insidePatientFinance on Twitter @insidePF.

The post CASE STUDY: Increasing Outside Medical Collections for Emergency Physician Groups appeared first on insidePatientFinance.

[Senator Franken quoted from a piece insideARM.com wrote for Forbes.com: Why The Media 'Can't Handle the Truth' About Accretive Health. You can hear the soundbite here.]

The hearing also may serve as a portent of future changes, as Franken, who has in the past sponsored legislation tightening restrictions on collections practices, has promised that the hearing represented only a beginning and that he would “look into whether we can do more to strengthen our federal laws” regarding patient debt and collections practices.

Less than one percent of Accretive’s activities are related to debt collection, according to Accretive Senior Vice President Greg Kazarian, who testified before the senator in yesterday’s field hearing held in state capitol. But that one percent is creating no end of troubles for the Chicago-based health care consulting company.

“Many of the allegations we’ve heard here this morning are deeply troubling,” Kazarian wrote in a prepared statement read at the hearing. “And if they are true, they would be flatly inconsistent with Accretive Health policies, our training and our values. To any patient who experienced any interaction with us or with Fairview employees that lacked compassion and professionalism, we apologize.” Kazarian also submitted a statement reiterating Accretive’s denials of much of the attorney general’s compliance review report.

The first witness was Minnesota Attorney General Lori Swanson, whose investigation has attracted heavy media scrutiny into Accretive’s relationship with Fairview Health. Swanson testified that Accretive “thought it was above the law,” that its contracts with Fairview “unduly incentivized the company to ignore the cultures, and mission and values of a charitable hospital organization,” and that “the hospital was unable to restrain Accretive.”

The Minnesota Attorney General repeated several times that her office oversees the conduct of not-for-profit organizations, yet Fairview has not been subject to sanctions or legal action as it had been in 2005, when after a compliance review, the attorney general’s office found that the hospital had been conducting overly aggressive collection practices. Following that review, the attorney general and Fairview entered into a court-ordered consent decree “to reform and modify it’s billing and collection practices.”

To date the attorney general has filed one lawsuit against Accretive after a company employee had a laptop stolen with patient data of 20,000 Minnesotans. At yesterday’s hearing, the attorney general indicated that her office found numerous violations of federal law, but not state laws – at least not state laws that the attorney general’s office prosecutes.

Collection agencies are regulated by the Minnesota Department of Commerce, which has entered into a cease and desist order with Accretive. This was only the first phase of its investigation, testified Michael Rothman, commissioner of state agency. “I want to make it clear that to the extent the evidence collected in our investigation substantiates these allegations, such allegations would represent a severe and troubling disregard of consumer rights and a clear violation of Minnesota law.”

Commissioner Rothman declined to go into details of the investigation because, under Minnesota law, such information is “classified” until the investigation is completed.

Accretive has denied wrongdoing, and with respect to HIPAA, Kazarian testified that the company was not in violation.

Yesterday’s hearing contained a multitude of takeaways and lessons learned that every health care organization and collections vendor should consider, among them:

1) Make certain all paperwork and filings are in order. The attorney general alleged that Accretive and another Minnesota client, North Memorial, did not have in place an “associates agreement” that details how data will be handled and protected between health care organizations and third-party vendors. The document is required by HIPAA, and according to the attorney general, once North Memorial discovered it had no such agreement with Accretive, the two parties allegedly created one and back dated it, and conducted the entire exchange in e-mail, according to the attorney general. Sen. Franken expressed keen interest is seeing the evidence the attorney general collected on this issue.

2) Speaking of e-mail, be professional in all business communications, and make certain your employees also adhere to that standard. Senator Franken read portions of an e-mail from an Accretive employee who referred to debtors in unflattering terms such as “deadbeats” and other offensive language. Accretive fired the employee, but only after discovering the e-mail in the course of responding to the attorney general’s investigation.

3) Be consistent in all internal and external messaging. Sen. Franken pointed out how Accretive presented its relationship with Fairview to its shareholders differed from how it was portrayed in the company’s written and verbal testimony to Sen. Franken.

“We work in a partnership model,” was how Kazarian explained it in his testimony. “At the end of the day, both practically and contractually, if there is any disagreement with any aspect of the revenue cycle work, the final authority sits with Fairview … we viewed our work with Fairview as collaborative. We saw it as a shared set of responsibilities.”

Franken read from Accretive’s SEC filings which stated the company “assumes full responsibility for the management and cost of a customer’s revenue cycle” and that it has the right to control and direct hospital staff. “It says you can fire employees,” Franken said

Kazarian explained that the SEC filings are “written more broadly.” Accretive has 26 contracts with Fairview that detail exactly who is responsible for what.

“It seems to me that Accretive is saying one thing in the SEC filings that it does assume full responsibility and that Accretive is saying pretty much the opposite thing in the document s that I got from you and your written testimony today, that Fairview is responsible,” Franken said. “And I just don’t get it.”

4) Sensitive data needs to be treated like gold, because losing it can take away yours. A laptop containing unencrypted patient data was stolen from an Accretive employee last year. Where Accretive management erred was that the employee was not working in the division that has access such data, but had given it to him because to help him explore if he wished to join that part of the company.

5) Remember you are dealing with human beings. Accretive was criticized for imposing a numbers-driven culture at Fairview, one that lacked compassion. Sen. Franken described Accretive’s practices as “badgering. Attorney General Swanson focused her criticism on what she claimed Accretive called its “secret sauce,” visiting patients in the emergency to collect fees. The attorney general claimed that patients under physical duress – in pain, disoriented, under the influence of pain killers – were asked to pay hospital fees.

Accretive’s Kazarian testified that compassion is a central part of the company’s business philosophy and mission. “The core of what we do every day — everywhere we work — is help hospitals find all available coverage for patients, and ensure that insurance companies and government programs pay the hospitals the money they are owed for the care they provide,” Kazarian said. “We go to bat for patients who have been denied insurance coverage for pre-existing conditions. We advocate for patients when their insurance company refuses coverage for conditions that are medically necessary. We fight to get patients who qualify on disability. Over 95% of the revenue we secure for hospitals come from insurance companies or government payors.”

At the conclusion of yesterday’s hearing, Sen. Franken read two thank you notes from patients who praised Accretive for their compassion and hard work on their behalf. “I think that should be the norm,” Franken said. “This is Minnesota. People in Minnesota are good at their jobs and we nothing if not nice. I would expect Minnesota Health Care employees do a great job in very difficult circumstances.

“The revenue cycle folks that were doing these jobs for Fairview had to exercise a lot of judgment,” he continued. “These jobs require not just sensitivity but also the ability to make distinctions, distinctions about when and how and where it is proper to ask patient for money. It seems to me that there is right way and wrong way, and a right time and a wrong time to do these things. And to help your employees get right means creating the right culture. We are all human beings and human beings are not perfect, but leadership in the industry isn’t just about providing the right software and the right processes, it’s about providing thoughtful guidance. It’s about creating a culture where people err on the side of compassion.”

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