In This Issue:
[President's Message]
[2008 – 2009 Chapter Leaders Attend LTC]
[Northeast Ohio HFMA Speaker Series]
[Patient Financial Services Recap]
[Article: Mitigating Risk with Price Transparency]
[Kudos]
[Puzzle]
 
Newsletter Archive

 

Presidents Message

Fellow members,

For those of you that missed this year's GHALI at Kalahari, we're sorry that you couldn't join us!  The team collaborated to provide quality educational programming and outstanding professional networking in an exciting new location. Many thanks to Dave Lang, Adam Schweikert and the full committee for continuing a fantastic tradition. We are already beginning our planning for next year so we're looking for your input on location, dates, topics and any other input that you would like to share. Whether you were able to join us or not, we'd like your feedback. Please email a committee member or me.

We also have a full summer of programs and networking opportunities for you to consider. We hope to see you soon at an educational event! 

Have you considered the educational benefits of HFMA certification? I have! I'm pleased to report that I have successfully completed my exams and can now formally apply for certification. As summarized on the national website, “achieving these designations help prepare healthcare finance professionals for increasingly responsible positions in the healthcare industry and demonstrate dedication to professional development”. Please consider this opportunity to Make a Difference and stand out with a CFHP and FHFMA designation. We do have study guides available and even some free exams, so please consider this opportunity for 2008. 

It’s hard to believe how fast my year as chapter president has flown by. The theme this year has been “Making a Difference”. Each of the chapter volunteers has clearly demonstrated this. I thank everyone for their help and appreciateall of the personal support from this leadership team, especially in recent months. We are fortunate to be surrounded by a group of caring professionals who Make a Difference.

We are supported by strong leadership as we look ahead. We always appreciate the opportunity to involve you in our chapter’s development. Please contact me or any member of the leadership team if you’d like to be involved in Making a Difference for Northeast Ohio HFMA. 

Sincerely,

Karen Mihalik
Chapter President 2007 - 2008


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2008 – 2009 Chapter Leaders Attend LTC

This year’s Leadership Training Conference was held in San Antonio, Texas April 13th – 15th. The goal of this event is to train, orient, develop, energize, and focus HFMA chapter Leaders for the upcoming year. This year’s theme “Making Connections” was the emphasis in all tracks and sessions and should make the 2008 – 2009 year very successful.

Attending this year from our chapter:

  • Chuck Josey, President Elect
  • Diane Lilko, Director/Program
  • Claudio Zanin, Director/GHALI
  • Jack Bailey Director/Newsletter

Next years LTC is April 19th – 21st in Ft. Lauderdale, FL


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Northeast Ohio HFMA Speaker Series

Program Date:
       June 17, 2008 (afternoon)
Program Location:  Great Lakes Brewery, Rockefeller Room

What Every Current and Future Healthcare Finance Leader
Should Know About . . .

  • Revenue Cycle
  • Reimbursement
  • Legal & Compliance

Who will benefit from this?  These three well-rounded presentations will give you insight into current key issues affecting all healthcare finance professionals.

Featuring: 

  • Don Paulson, MBA, FHFMA, is the VP of Finance Revenue Cycle Management at University Hospitals Health System
  • Christopher Mahler, CPA, is a Manager in the Health & Human Services Group at Plante & Moran, PLLC
  • Anthea Daniels, Esquire, is a Partner at Calfee, Halter & Griswold, LLP

Program Date:         July 24, 2008 (afternoon)
Program Location:  Windows on the River

Current Updates in Managed Care – Joint Program with AAHAM and NEOHFMA

Key Note Speaker:    Charles Cataline, Senior Director, Health Policy, Ohio Hospital Association


Program Date:         August 2008
Program Location:  To Be Determined

Volunteer Appreciation Outing


Patient Financial Services Recap

Patient Financial Services Session: February 21, 2008
Committee Chair, Bernard Weems/University Hospitals and Committee Co-Chair, Maureen Campbell/MetroHealth

The Patient Financial Services session was once again packed full of key updates and information and delivered by three very knowledgeable and well-known speakers. Here’s a recap of what you missed:

The Latest on Medicare, Medicaid, and Medicaid Managed Care
Speaker: Charles Cataline – Senior Director of Health Policy, Ohio Hospital Association

Mr. Cataline staffs the OHA Finance and Admitting, Billing and Collection Committees. He also serves on a number of state and national boards and committees, including the 2005 Chair of the Allied Association of Hospital Accountants and Financial Specialists, 15 years with the National Uniform Billing Committee, and current appointments to the CMS Outpatient Medicare Technical Advisory Group, the American Hospital Association’s (AHA) Model Practices Group, and the Editorial Advisory Board of AHA’s Coding Clinic for HCPCS.

Mr. Cataline provided the latest updates on the Medicaid budget crisis and provider payments and policy – high-level key points can be found in the attached file as there are many! OHA is continuing to stay focused on MCP’s, their numbers, and finding ways to address inefficient and/or duplicate procedures, increase education and training, and defining best practices to avoid the inefficient use of ED. The MCP Accounts Receivable Survey & Report was launched on February 20th. Related to Medicare Value-Based Purchasing, the CMS proposal requires no new funding and will seemingly focus on hospital-specific quality performance scores based on clinical processes, clinical outcomes, and patient satisfaction. The VBP is based on 27 existing inpatient quality measures, however there is little detail on how the “model” will be developed, measured, tested, and how outcomes will be analyzed. More details will come… Medicare Recovery Audit Contractors & Medicare Administrative Contractors continue to be a hot topic and one necessary for hospitals to be prepared for in advance. As of the meeting date, a bidding war was still in process and no specific RAC named (supposed to have been identified by January 1). And finally, the current state of the BWC lawsuit and payment update as related. The lawsuit is being settled and encompasses over 110 hospitals, 400,000+ bills and $80 million to be distributed. Inpatient hospital PPS updates were installed 1/1/08, are not retroactive to October 1st, MS-DRG’s are included, and POA’s are – for now – not included. There is no word on the changes to the Outpatient payment system. You can watch for details and additional information on the OHA Finance website.

Self Pay Risk: Focus on the “Right” Accounts at the “Right” Time
Speaker: Tom Yoesle, Corporate Director of Patient Accounting, Orlando Regional Healthcare

Mr. Yoesle serves as the Corporate Director of Patient Accounting for Orlando Regional Healthcare, a multi-hospital system with annual net revenue exceeding $1.3 billion. Tom has enjoyed over 15 years with ORH in various HIM, system administration, IT, and financial management roles. Prior to becoming Corporate Director of Patient Accounting, Tom was part of the IT/Systems Team who installed the QuadraMed suite of HIM, Registration and Patient Accounting applications at ORH hospital facilities and their Central Business Office.

Mr. Yoesle provided great learning tools to the attendees on:

  • Increasing self pay collections by focusing resources on the most collectible accounts.
  • Identify low income patients who qualify for financial assistance.
  • Leverage third-party data to optimize self pay account prioritization.
  • Apply predictive modeling techniques to improve the accuracy of AR segmentation.
  • Track self pay collection performance and set measurable goals for improvement.
  • Create a metrics-driven business office based on accountability and transparency.

Tom demonstrated the success that ORH has had in applying these principles to their operations and with utilizing credit score management tools/vendors. The first step in his analysis was to define the population (age groups and numbers) and determine the low risk, medium risk, and high risk, financial assistance, and charity groups – who are your largest and who are your smallest. The second step is start building a model based on the population and segmentation and one that best utilizes your resources to maximize returns. The majority of your full-time staff would be allocated to the “medium risk” segment – approximately 80% of the FTE allocation. This segment represents those patients that can pay, but need reminders to do so. Fewer resources are then applied to the “low risk” where data shows that patients in this category will in fact pay with little intervention, thus the ability to automate the collection process. Fewer resources would also be applied to the “high risk” segment as data reflects a history of patients who do not pay and therefore, accounts can be immediately placed in outside collections. By utilizing credit scoring systems and tools to define your population, you can then build metrics on top of it to ensure your team is focusing on the “right” accounts at the “right” time.

Negotiations: Change the Game!
Speaker: Bill Brown, VP Sales & Marketing, Medical Account Services

Bill Brown is the VP of Sales and Marketing for Medical Account Services, an anesthesia practice management and financial service company. He is a lecturer for corporate meetings and serves as an adjunct professor in Business Administration at Thomas Moore College in the Cincinnati, Ohio area. He has earned a BS Degree in Biology and a Masters Degree in Business Administration.

Mr. Brown provided the group with unique step-by-step approaches for conflict resolution and achieving mutually acceptable agreements (based on research from the Harvard Negotiation Project). Tips were provided on how to separate the people from the problem in your negotiations, focus on the interest – not the positions of each side, generate a variety of possible solutions before deciding what to do, and insist that the result of the negotiations be based on some objective standard. We take part in negotiations every day and as Bill stated, “the good news is that the basic elements do not change” – whether it involves families, friends, bosses and employees, customers, or corporations. Mr. Brown outlined the “principled negotiation” whereby four key elements are involved:

  • People – separate the people from the problem (“people problems” can occur from three things – perception, emotion, and communication)
  • Interests – focus on the interest and not on the positions (interests help to define the problem – needs, desires, concerns, fears)
  • Options – generate a variety of possibilities before making decisions
  • Criteria – insist that results be based on some objective standard

Counter to “principled” negotiation, Bill also discussed how “positional bargaining” (soft or hard) can be counter-productive and ineffective. Bargaining over positions can lead to unwise agreements, inefficient outcomes, and endangered ongoing relationships. As well, the “nice guy/gal” approach isn’t always the answer either as it can lend to vulnerability. Mr. Brown challenged the participating group to be hard on the problem, soft on people, and to not back down on an issue or interest you have, but to focus on the solutions and to be reasonable and open to reason with standards used and applied. There is an exception to every rule, but everything is negotiable!

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Mitigating Risk with Price Transparency
By Karl Kimball

Health care historically never thought of itself as an industry. However, the pressures that traditional U.S. health care providers are feeling is industrial in nature i.e., competition, quality of service, price competition, and consumer (patient) value.

Hospitals are challenged to be competitive but find it extremely difficult to both comprehend and also take actionable steps to thwart the competition. Perhaps the first and most important step for hospitals is to provide price transparency. Consumers must know what the price is for health services. Hospitals will be forced to follow the same course all other industries have been forced to follow i.e. price transparency. Consumers do not accept a continuous chain of discovery and follow-on charges. Consumers demand fixed prices. However, price transparency carries risks for hospitals. These risks are especially high because hospitals don’t know their true costs for services and therefore are reluctant to give fixed prices. The simple task of providing prices for services is difficult for a hospital because the traditional way hospitals determined costs is based upon estimation algorithms of RCCs and RVUs. Both methodologies fail because they are based upon averages and are so inaccurate it puts the hospital at very high risk. Further, quality initiatives to improve services and provide price transparency are all but impossible with RCCs and RVUs because the incremental cost changes of a quality program are small compared to the error introduced by averaging based methodologies.

Scientifically, hospitals have not followed the science of quality (Edwards Deming model) and Activity Based Costing used to determine true costs and hence provide a solid scientific foundation for pricing. Hospitals must adopt these methodologies that will allow them to understand costs, which leads to profitability, and finally price transparency. Deming put forward a definition of quality as “meets requirements”. This defined quality as set of metrics rather than a subjective evaluation. The early Volkswagen Beetle represented a low end car that was highly reliable because of a low maintenance air cooled engine. The Volkswagen Beetle was manufactured with very few flaws and met the criteria that set the standard for “economy car”. The consumer got exactly what they expected when they purchased a Beetle, low price, low maintenance, and high reliability. Activity Based Costing is primarily a methodology of measuring the consumption of resources for a specific activity. This methodology is the heart of modern day supply chain and manufacturing that every successful company in every industry uses to insure that costs are known and pricing can be transparent. Without known costs all other metrics are meaningless, i.e. profit, price, and quality.
Price transparency is an extremely important topic for all hospitals. The ease and low cost of international travel has created more than just vacation time abroad, it has created access to markets that now cater to consumers. Dubbed “medical tourism”, the attraction of low cost health care on par with the best of U.S. health care combined with the luxury and services of a vacation resort is increasingly the choice for major clinical procedures. Soon, even routine procedures will become routine for the consumer to seek outside the U.S., because they can be combined with a vacation or business trip. Consumers will opt for treatment where the convenience, cost, and quality combination makes it their best choice. The bottom line is that there is now competition for traditional health care.

The driver for this competition is not the chance for the consumer to have their hip replaced in exotic location. The driver is cost. The continuing rise in U.S. health care costs is the driver that is creating choice for the consumer. Competition is also coming from the bottom i.e. retail health care from Walmart and others who provide affordability. Walmart leverages their low overhead to provide specific, high profit, high volume procedures. Again, low cost health care providers target and commoditize procedures that provide a combination of convenience, cost, and quality attractive to the consumer. Eventually they will dig deep into the mainstream health care market cherry picking and commoditizing more and more procedures.

The path to price transparency for hospitals is a path to industrialization for health care. Hospitals must transition because their competitors are taking their market away. For Hospitals to be successful they must provide price transparency and insure that the profit and quality they provide is competitive to stave off competition. Price transparency is the goal for hospitals to be competitive, however the price hospitals must pay is the cost to transition to scientifically sound methodologies such as the Deming model and Activity Based Costing.

About the Author: Karl Kimball is Vice President of North America for Cortell Health and a member of the Texas Lone Star HFMA Chapter. Kimball holds a BS in Mathematics from University of Texas at Arlington. Karl has been a major contributor to the development of computer and communications standards and has been an ANSI Advisory Board member, a POSIX contributor, JTC 1 Delegate, workgroup leader for the ISO transaction processing standards. He has held various executive and leadership roles for IBM, Apple, Datapoint, and was a founding member of Corporation for Open Systems. Karl can be reached at karl.kimball@cortellhealth.com.


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Kudos

The program committee thanks each and every one of you for participating in the recent survey! We will be using your input in our continuing effort to make our program announcements easy to read, to the point and in a format that fits into your busy schedules.

The winner of the $50 prize is: Ruth E. Homuth of Samaritan Regional Health System! Congratulations!

Anna Sulewski
Vice President & Program Chairperson

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Puzzle – A Night at Kalahari
By Jack Bailey

During a recent HFMA Event at Kalahari, four games were played. In one game Miss Scarlet used the spanner, but not in the library. In another game the rope was used in the study, but not by Colonel Mustard. During one game the gun was used in the conservatory, whilst in another game Professor Plum was not to be found in the library. Colonel Mustard was never in the conservatory and Mrs. White never used the rope. The lead piping may or may not have been used in the kitchen. Can you determine who used what and where?

Email your answer to Jack Bailey at jlbailey@wowway.com. All correct entries will be included in a drawing and one lucky entrant will receive a $25 gift certificate.

Previous puzzle – Be My Valentine
Answer:
Name Color Boy
Lily Jetson Pink Adam
Millie Hanson Red Ethan
Molly Motson Blue Dylan

Winner: Barry Franklin of Parma Community General Hospital won a $25 gift certificate to Damon’s Bar & Grill.

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Corporate Sponsor Program
We gratefully acknowledge the commitment of our Corporate Sponsors who assist in the funding of the Chapter's programs and activities
Presidential Level
Ernst & Young, LLP
Human Arc
KPMG LLP
Long-O'Shea & Co. LLC
Platinum Club
Fenner Consulting
Joseph R. Harrison Company, LPA
HRSI/FirstCredit International Corp.
IC Systems
JP Recovery Services, Inc.
MedCom Solutions
NatCity Investments, Inc.
Revenue Group/HRS
Total Practice Management, LLC
Gold Club
CareMedic Systems
RelayHealth (Formerly Per-Se Technologies)
Squire, Sanders & Dempsey LLP
Silver Club
Cirius Group, Inc.
Cymetrix
Kreg Information Systems
PatientKeeper
Bronze Club
BKD, LLP
Bruner-Cox, LLP
Calfee, Halter & Griswold LLP
CDR Associates, LLC
DMI Transitions
Engelhardt & Emrhein
HMC Group
JP Morgan Chase
KeyBanc Capital Markets
Masters Assocs Receivables
Mgmt, Inc.
NCO Financial Systems Inc.
OSI Healthcare Services
Quadax, Inc.
Receivables Outsourcing Group
Resources Global Professionals
SAKAL / CAI
Sanford Rose Associates - Executive Search
Senex Services
UCB
Vorys, Sater, Seymour & Pease LLP
Wise Management Services, Inc.
Wolfskill & Associates

2007-2008
HFMA Northeast Ohio
Chapter Officers

President
Karen J. Mihalik

President-Elect
Charles S. Josey

Vice President
Anna Sulewski

Secretary
Susan R. Flaherty

Treasurer

Suzanne M. Tschetter

Chairperson

Christopher Milligan

Chapter Coordinator
Kathleen A. Much

Board of Directors
Jack L. Bailey
Cynthia A. Dormo
Joyce Gusman
Michael J. Manfull
Robert S. Matitia
Mary Jayne Reedy

Visit HFMA National at:
www.hfma.org

Visit HFMA Northeast Ohio at:
www.neohfma.org