Unit 4 Assignment 1 Draft CAPSTONE POWERPOINT-Management Affiliation

Final Project Draft

Introduction

In most sectors, product or service payment is straightforward, that is, you get to know about the price of product or service, pay for them, and receive the product or item instantly –within a matter of seconds. However, in the healthcare sector, the process is more different, cumbersome, and complex. Notably, in the healthcare, a patient does not know about the cost of treatment until he or she has been treated –the cost of the whole process is determined and paid after the patient has been treated. This makes whole issue of healthcare reimbursement a long process that calls for a number of steps. This long process ends up delaying payments to medical service providers since patients are saddled with bills they are not aware of and therefore end up not paying (Sommers et al., 2014). The process of healthcare reimbursement becomes more complex when a patient has an insurance cover. Many medical service providers face the burden of having to submit the claims to medical insurance companies and wait for approval. Additionally, it becomes challenging for providers to appeal for denials once the bills submitted to medical insurance companies are not approved. In as much as healthcare providers are striving to avoid insurance and bill the patients directly, failing to accept insurance means that they lose a lot of patients since most people use the medical insurance cover to enable them access low-cost and subsidized healthcare cover as stipulated in the Affordable Care Act (Sommers et al., 2015). Hence, by accepting medical insurance, healthcare providers have more patients which means more prospective healthcare reimbursement. However, many healthcare providers face a lot of difficulties when billing the insurance companies –something that led to denials, meaning that the bills end up not being approved by insurance companies.

Problem Statement

Reimbursement and Electronic Health Record (EHR) issues experienced in both public and private healthcare in behavioral health have become rampant. Consequently, these issues have led to a more complex healthcare reimbursement altogether –something that is forcing some providers to avoid accepting insurance when treating patients as they fear that insurance carriers may end up rejecting those claims hence leading to losses.

Background to the Problem

Notably, the process of healthcare service provision is totally different from other sectors. Patients who visit hospitals will pay for the services after they have recovered fully. This means that the cost of treatment is not easily predetermined though in some private hospitals, the cost of undergoing a certain treatment can be determined before the patient undergoes the actual process (Eva et al., 2015). For cancer treatment for example, a patient in private hospital knows the cost of chemotherapy procedure even before undergoing the process.

Notably, people are opting to utilize the Affordable Care Act, forcing many patients to obtain medical insurance cover in order to benefit from low-cost healthcare coverage. This means that healthcare service providers have to use the data provided in the patient’s bill to prepare an insurance claim in order to get payments from the insurance companies covering up the relevant patients. The process of preparing claims and sending them to the clearinghouse and then to the appropriate payer is long and complex (Garcia-Subirats et al., 2014). Once the claims are submitted to the relevant bodies, errors are checked to ensure that insurance guidelines are followed. The claims are evaluated to ensure that services offered to the patient by the healthcare provider are assigned the appropriate codes –CPT codes are used to identify various treatments while ICD codes are used to identify diagnoses.

Notably, the healthcare providers are supposed to log into electronic health record (EHR) and fill in all the details of the patient including the diagnosis as well as the treatment plan. In the EHR, healthcare providers are supposed to assign relevant medical codes in order to help the payers (insurance companies) understand the services offered to a patient and why (Jena et al., 2014). However, the process of filling an insurance claim is marred with errors that lead to the rejection of the claim by the payer –the claim must meet certain guidelines, else, no payments will be made to the healthcare provider.

Explaining the Problem/Issue

The issue of having an insurance claim rejected by the payer presents a lot of problems to private healthcare providers like North Central Health Care as opposed to public healthcare providers. In public healthcare, the operations are mostly funded by government through taxpayers’ money (Thirapatarapong et al., 2014). In this perspective, the government healthcare facilities do not incur many operational burdens since the government caters for most of its costs including the paying the employees as well as constructing new facilities.

On the other hand, in private healthcare facilities, all the operations are funded by individual owners. Therefore, in order to meet the operational costs, the private healthcare facilities should be managed effectively to ensure that the facility does not run into losses. Private healthcare facilities must raise the money to pay the staff as well as fund the construction of extra facilities (Kim et al., 2014). Hence, management at private healthcare facilities should ensure that patients treated have paid their bills in full and in the right time to ensure that it has the funds to facilitate its operations.

Notably, the time required to process an insurance claim is long –probably more than a month (Thirapatarapong et al., 2014). This can be very unfair to private healthcare facilities that require a lot of money to pay the staff and other costs at the end of the month. To make the matter worse, if a claim is not approved and the payments are not made, a private healthcare facility might run into losses unlike public hospitals where all the costs are met by the government.

Therefore, the issue of reimbursement by insurance providers is presenting a rather big problem to private healthcare facilities since delayed or rejected claims means a loss to them because they may end up lacking the money to run their daily activities which include employees’ salaries as well as other maintenance costs.

Performance Improvement Model

The performance improvement model used in this project is the Root Cause Analysis. By using this model, the project will be seeking to identify and understand the causes of denials/rejections of insurance claims as well as the events that lead to denials and what can be done to solve that (Eva et al., 2015). There are a number of steps involved in this model that are related to the issue of insurance claim rejection:

· Identifying the causal factors and root causes of the issues – In this step, I will seek to understand what has caused the problem of disbursement as well as filling the information in EHR. By doing so, it will be easier to know what causes the issue of denial and consequently address it. Qualitative process is used here to identify the issues.

· Identifying the barriers and how the they be addressed in future – Here, the barriers of insurance claim approval are identified as well as ways of dealing with them in future

· Developing recommendations for the challenges/barriers identified – This is the final step that seeks to highlight the strategies for process and system improvement in order to avoid such issues in future.

Relevance of The Project in Relation to The Issue

Private healthcare facilities like North Central Health Care require a lot of money to pay the staff as well as take care of other costs of running the operations of the facility. Patients who come to the facility need to be treated and pay for the bills in order to ensure that the facility gets enough funds to run its daily activities. However, the facility has faced a lot of problems due to delayed or rejected disbursement of funds by the insurance providers since most of the patients nowadays use insurance to pay for their medical bills. Due to the challenges encountered by North Central Health Care and other private healthcare facilities, my project seeks to:

· Assess the accuracy of the billing practices as well as to evaluate trends in denials.

· Evaluate errors in missed revenue as a result insurance claim rejection

· Find out the causes of increased cases of denials

In order to address the issue of insurance claims rejections at North Central Health Care, I will do the following:

· Create a mass awareness campaign in order to address the issue of county wide changes in addresses that could potentially hinder reimbursement since insurance providers are not aware of such changes.

· Create a greater sense of Compliance, Reimbursement strategies, and Error Reductions due to passive errors and Coding errors as well.

· Provide a corrective action to errors in missed revenue in order to increase the revenue while also developing a policy and procedure for future billing to prevent reoccurrence

· Audit provider accounts and establish Protocols, Policies, and Procedures that will be used to address any unforeseen issue that could hinder reimbursement in future.

· Create a protocol and will take into consideration the accuracy of billing practices used before in order to prevent the denial trends from occurring in future.

Relationship Between the Project and CAHIIM Learning Domains

I. Health Data Management

Healthcare service providers are supposed to maintain patient’s data in a more appropriate manner. This data is required when preparing an insurance claim. Notably, healthcare provides are required to use the information delivered in the patient’s bill to in order to help the insurance provider in understanding the relevant data required in processing the claim (Siciliani, Moran & Borowitz, 2014). Therefore, in order to facilitate efficient insurance claim and avoid denial –which is the main aim of this project –a healthcare provider must pay attention to Health Data Management.

II. Quality Management and Performance Improvement

Unlike public healthcare facilities, private healthcare facilities require effective management in order to ensure smooth running of its operations. The main aim of this project is to ensure that insurance claims rejections do not occur in future. Hence, addressing the issue of performance improvement is directly related to this project. By doing so, the problem of denial is addressed and mechanisms of handling such cases are improved to avoid future insurance claim rejections.

III. Strategic Planning and Organization Development

The main objective of this project is to solve the issue of denial that has proved to be a major drawback to healthcare providers especially the private ones. Solving a problem requires strategic planning which highlights various ways of solving an organizational problem. In this case, North Central Health Care requires strategic planning in order to counter the problems of denials by insurance providers which the core objective of this project.

Learning Outcomes of the Project

From the project, we can learn the following:

i. Private healthcare providers like North Central Health Care require effective management as compared to public healthcare facilities due to financial problems –private healthcare providers require funds to run their daily operations unlike public one which are fully funded by the government.

ii. Many people are relying on insurance covers to pay for their medical bills and healthcare providers must be keen in learning how to lay insurance claims in order to receive the payments of patients’ treatments

iii. Insurance claim is a complex process that require attention of medical coders in order to fill the relevant information required by insurance provider for the purposes of reimbursements.

iv. Medical coders should learn how to use the Electronic Health Record and observe all the changes in codes and addresses of insurance carriers so as to avoid the cases of rejected reimbursement.

Recommendations

This section seeks to highlight what improvements can be made in order to ensure that insurance claims are not rejected by insurance providers in future. These include:

· Using software – Healthcare providers should make use of software that will enable them to key the patient information electronically into UB-04 and CMS-1500 documents especially using the “fill and print” software (Jena et al., 2014). This software ensures that there are no errors in the filled document hence increasing the chances of claim approval by the insurance provider.

· Using the clearing clearinghouse – A clearing house acts a third party operation between insurance carriers and healthcare providers (Nwanodi, 2018). Healthcare providers such as North Central Health Care should ensure that all their claims are sent to clearinghouses before being forwarded to insurance carriers for evaluation and subsequent compensation. Clearinghouses perform a key role in helping healthcare providers to format the insurance claims in accordance with insurance and HIPAA standards as well as removing possible errors in them to minimize the chances of rejection.

References

Eva, E. O., Islam, M. Z., Mosaddek, A. S. M., Rahman, M. F., Rozario, R. J., Iftekhar, A. M. H., ... & Razzaque, M. S. (2015). Prevalence of stress among medical students: a comparative study between public and private medical schools in Bangladesh. BMC research notes, 8(1), 327.

Garcia-Subirats, I., Vargas, I., Mogollón-Pérez, A. S., De Paepe, P., da Silva, M. R. F., Unger, J. P., & Vázquez, M. L. (2014). Barriers in access to healthcare in countries with different health systems. A cross-sectional study in municipalities of central Colombia and north-eastern Brazil. Social Science & Medicine, 106, 204-213.

Jena, A. B., Goldman, D., Weaver, L., & Karaca-Mandic, P. (2014). Opioid prescribing by multiple providers in Medicare: retrospective observational study of insurance claims. Bmj, 348, g1393.

Kim, L., Kim, J. A., & Kim, S. (2014). A guide for the utilization of health insurance review and assessment service national patient samples. Epidemiology and health, 36.

Nwanodi, O. (2018). Update: Administrative Efficiency, Clearinghouse Exchanges, Rate Review, and Zero Profits to Limit Healthcare Insurance Premium Increases.

Siciliani, L., Moran, V., & Borowitz, M. (2014). Measuring and comparing health care waiting times in OECD countries. Health policy, 118(3), 292-303.

Sommers, B. D., Gunja, M. Z., Finegold, K., & Musco, T. (2015). Changes in self-reported insurance coverage, access to care, and health under the Affordable Care Act. Jama, 314(4), 366-374.

Sommers, B. D., Musco, T., Finegold, K., Gunja, M. Z., Burke, A., & McDowell, A. M. (2014). Health reform and changes in health insurance coverage in 2014. New England Journal of Medicine, 371(9), 867-874.

Thirapatarapong, W., Thomas, R., Pack, Q., Sharma, S., & Squires, R. (2014). Commercial insurance coverage for outpatient cardiac rehabilitation in patients with chronic heart failure. Abstracts/Annals of Physical and Rehabilitation Medicine 57S, 422, e424.