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Collecting revenue for services rendered ranks as one of the more challenging tasks a hospital faces. It's also one of the most indispensible -- if that hospital wants to keep its doors open and continue serving the health care needs of its community.
That goes for vast institutions like Massachusetts General Hospital in Boston as well as smaller facilities like Henry County Health Center, a 25-bed, critical-access hospital in Iowa, where CIO Stephen M. Stewart, MBA, FACHE, CPHIMS, and a team of cross-disciplinary functions have revamped administrative functions with admirable success.
In 2004, Henry County Health Center's accounts receivables were in the range of 110 to 112 days. Nowadays, they fall in the range of 38 to 39 days.
"For a long time, we had a fairly disjointed, silo-driven process in which each function did its own thing," Stewart acknowledged. "We asked ourselves, 'What three things will make for success?' The answers were teamwork, partnership and technology. Interestingly, those three things didn't come as an epiphany. But the longer we worked on them, the more intuitively obvious it was that those three things made a great deal of sense.
"Teamwork, partnership and technology really make the difference."
Complex Chain
A hospital's revenue cycle is a complex chain of functions, according to Stewart.
"It begins with the patient's scheduling, to his arriving and registering in the hospital, to the capture of charges for services performed, to the appropriate documenting and coding of those services through the claim, to billing the insurance company, to billing the patient and collecting the associated funds," he explained.
Managing that cycle "involves every end of the spectrum," he added. "It includes physicians and all the other clinicians -- even maintenance and housekeeping. Everyone contributes to the process of the revenue cycle, which generates the money from which the hospital continues to operate."
Only when a culture of teamwork takes root can the whole chain operate optimally. "We recognized that all the different functional entities of the hospital had to focus and work together," Stewart said "They are all the receivers of inputs and providers of outputs. What impact does each of those functions have on the downstream receiver of those functions?"
Working with other departments in mind -- working as a team, in other words -- "may not be the most convenient way," the CIO added. "In fact, it might mean more work. But if it benefits the overall process, it's the right thing to do."
Michael Gibbons is an editor at Merion Matters, the parent company of Executive Insight.
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