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Structuring a revenue integrity department – lessons from Cedars-Sinai [PODCAST]

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The Hospital Finance Podcast

In this episode, we are joined by Gretchen Case, Executive Director of Compliance and Revenue Integrity at Cedars-Sinai Medical Center, to discuss the optimal way to structure a revenue integrity department.

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Highlights of this episode include:

  • Background on Cedars-Sinai and how its’ Revenue Integrity department is divided to handle responsibilities.
  • How Revenue integrity departments can be broken-out into four practical areas: architects, air traffic controllers, law enforcement, and accountants.
  • What does the structure of Cedars-Sinai revenue integrity department look like?
  • Practical advice for hospitals looking to structure a revenue integrity department.
  • And more…

Mike Passanante: Hi, this is Mike Passanante and welcome back to the award-winning Hospital Finance Podcast®. As hospitals around the country embrace the burgeoning concept of revenue integrity, questions arise around the best way to structure a revenue integrity department. To discuss one hospital’s approach, I’m joined by Gretchen Case, Executive Director of Compliance and Revenue Integrity at Cedar Sinai Medical Center. Gretchen has over 25 years of experience running hospital revenue integrity departments responsible for over $16 billion in annual hospital gross revenue. Gretchen, welcome to the show.

Gretchen Case: Hi, Michael. Thank you very much.

Mike: Gretchen, I think most people are familiar with the name Cedars-Sinai, but why don’t you start out by telling us a little bit about the hospital.

Gretchen: Sure thing. We are a large academic medical center in Los Angeles, California. We have approximately 900 beds. We book around 22 billion a year in gross revenue around and there’s net of around 4 billion. We have a huge transplant program, pretty much any kind of specialty you can think of in healthcare, it’s done at Cedars-Sinai. And we’ve started some affiliations in the Southern California market as well, so we’re growing.

Mike: Thanks, Gretchen. That’s a great tee up because, obviously, you’ve got some complexities in dealing with issues like revenue integrity and, obviously, as I mentioned in my intro, we’re going to talk about how you looked at it and how you decided to break up the responsibilities within the department to get to the most efficient result. So, briefly, can you explain to us what the areas of responsibility are within the Cedars-Sinai Revenue Integrity Department?

Gretchen: Yes, absolutely. I would say that they’re ever increasing. It’s a real passion of mine with regard to revenue integrity in the healthcare world that we live in today and it’s one that’s kind of nebulous out there and I think it’s been defined in different ways and it looks very different depending on the organization. And I think that’s fine. Towards the end of the program I’ll get to some suggestions I have related to what I’ve seen be successful as well as what I see as current trends going on right now. But at Cedars, we have responsibility in revenue integrity department for charge master, charge capture, charge audit, process improvement, data integrity, clinical integration, and what I call government audit program that I developed years ago, which is really the nod to the compliance piece related to the hospital billing. As a result, I had actually developed a definition. I was part of a group that was speaking on this at a conference earlier this year, pre-COVID. And the most distinct way to describe it is that RI is the discipline in the revenue cycle that supports optimal revenue recognition for all providers. Carrying best practices with an optimal use of technology, revenue integrity ensures compliance and mitigates regulatory risk through effective, efficient, and replicable processes. Delivering results to your organization. And that in a nutshell is kind of what our charge is – pun intended – and the areas that we sort of have responsibilities for.

Mike: Gretchen, you’ve presented on the topic of revenue integrity around the country and you’ve placed certain responsibilities into four practical areas, which I think is great for purposes of our discussion. Can you tell us what they are and how you define them?

Gretchen: Yes. So when I mentioned charge– everything that is sort of revenue recognition is sort of like the big umbrella things fall under. We ensure that the charges are created, that they’ve got all the accurate data elements that they need for billing purposes. And you’re also reporting services at that point too when you’re doing CPT codes and so forth, it’s for reimbursement but it’s really where the clinical becomes financial is what I always say about RI. We’re over charge capture. We’re ensuring that what used to be a very manual process for hospitals has been completely electronic now. And for better or for worse, I think in most cases, it’s for better. But there are some different challenges to that now in a completely EHR, electronic health record environment. Charge audit is less of a discipline now than it once was when systems were– lost charges was a big problem. Missing charge tickets, etc. Things were so manual that it was often hard to make sure that you were ensuring everything was correct and accurate.

So what we’ve done, which is typically like RNs and nurses that want to do something other than clinical nursing, even some physicians. They have the ability to look at a chart, clinically, but also understand how it needs to be represented in terms of charges and revenue. So that team we use for special purposes now. Sometimes compliance, sometimes charging. In older days, within RI, those were often looking for mischarges. Now it’s become a little bit more around accuracy and completeness. Data integrity is something really important now. Because of how electronic we are, you’ll obviously hear that saying in everything I talk about. But to produce one claim, up to 12 different systems can be involved with posting charges or claim scrubbing and submission. So there’s a very– how the numbers make their way through the systems is very important. That’s what we call data integrity. Making sure that it gets all the way through to where it needs to be accurately. And then compliance. That’s a huge piece and I think it fits very well within the RI structure because you have– it informs everything you do. So when you’re doing revenue codes in a charge master or CPT codes and you’re doing modifiers and all these other things that where the where the reporting of services becomes financial and based– create just a reimbursement. You have potential risks there especially with CMS programs like Medicare and Medicaid or MediCal in California. So having somebody that understands all of requirements being the person that is creating those things is very important. So those are the main areas that we work in.

Mike: And you’ve described the functions of your teams in a couple of different ways. You say they’re architects, for instance. What do you mean by that?

Gretchen: Yeah. Well, it’s more interesting than the titles of data integrity or charge capture or charge audit. So we call them architects, air traffic controllers, law enforcement, and accountants for fun. Architects is probably my favorite area. I do come from a family of architects so maybe that’s why I named it that. But if you have a strong beginning and end backbone, as in the charge master, it just facilitates so much through the billing process. So we have charge master, we have C-schedules. These are all sort of the tools that you have to build the environment in which you’re going to record your revenue. So that’s kind of how I always describe the architect. You’re building it. How are you going to charge for surgical services? How are you going to charge for your lab services? You’re going to do it by time or are you going to do it by procedure? These are questions that you have to answer. And your choices or your answers to these things are very important and that’s where you become sort of an architect of how it’s going to come together.

Air traffic controllers is a fun one because I mentioned earlier the multiple systems that can be involved with the generation of just one patient claim. We, on my team, felt it important to become certified in our areas of expertise. We are an ethics shop at Cedars and so many of us went ahead and got certified in the areas that we deal with most because we really wanted to understand how mysterious– I call it the ghost in the machine. How the ghost in the machine works. And in a new age of the electronic transmission of data, you really need somebody in there understanding how these things are flying around in the system.

Mike: And then you got into law enforcement, which is always a fun term for a revenue cycle. Tell us about that.

Gretchen: Well, this is a unique one and I find this, in what I call– and I’ve written sort of about a very mature revenue integrity program. So the first pieces I mentioned about charge mater, capture, audit, review, all those protocols and so forth. That’s sort of like the bread and butter of an RI program. If you get into law enforcement or compliance, you really have a mature program. Sometimes it sits over in internal audit, sometimes it sits in the world of compliance. But there’s been a lot published lately about how do people with the expertise that revenue integrity folks have being the ones that are also doing the self-auditing review is the most effective. So something I developed at Cedars-Sinai about seven years ago was something called the Government Audit Program or GAP for short. What we did is we took it on in RI, developed a small team to standardize our approach to all external government audits. Commercials is sort of the denial management, that’s over on this side. We do work with that sometimes but this is more focused on the government side.

So what we do is we conduct our own self-audit. We mirror them pretty much to the way that an OIG audit is done and we have a plan for the year and some of them are evergreen. Certain issues are checked annually, certain issues are checked as they come up as areas of concern or interest. And then we also bought a database, built it up so that we can identify what is that risk for the organization at any point in time relative to the type of audit that is being conducted? So if it’s a RAC audit or an OIG or a Mac, even an internal self-audit, all of these things are categorized and financially put into the system so that we understand what our risk is. And it’s been a very successful program. Not only in mitigating our risk, we’ve been advocates on behalf of hospitals with regard to issues and challenges we find within payment structures if you will or in CDs and so forth, we’ve been challenging for coverage decision at a national level. And it’s also provided the financial leadership of the organization the information they need to understand what our true risk is at any point in time, financially. So that’s been an interesting program and one which I hope to see RI departments kind of fill out and fully develop.

Mike: And then your accountants. That seems pretty straightforward but what do you mean by that?

Gretchen: So any RI program, even though we’re electronic and you think everything would work perfectly in an electronic environment, we all know now that is doesn’t. It works better and I am a big fan of it, but nothing’s perfect. One of the things that I think is a discipline that’s near and dear to the heart of most RI professionals is the need to show the value that you bring. So in my department at Cedars we have process improvement programs, we have a code-based reimbursement program, all of these things are looking at identifying the potential revenue loss that we found and that we mitigated and that we’ve returned to the bottom line. So each year we have a budget, a number that we are going for. We put in programs and we leverage the system in order to fix errors that we find and then we track the net revenue impact of that for a year. And it’s been a very– it’s been a great way to explain to the organization, internally and externally, what the program does, what we do, and what the net value is of what we do.

Mike: That’s great, Gretchen. And then when you think about all these functional areas, eventually you do have to put them into some sort of a practical structure to get them to operate properly. What does that look like at your hospital?

Gretchen: Just the structure of our department, so to speak?

Mike: Yes.

Gretchen: Yes. There’s about, I would say, 35 of us in the department, overall. That includes and associate director, several managers, a couple of supervisors. We are typically focused now on the – I mentioned earlier – the clinical integration with the clinical modules. So I always joke that the clinical modules, within electronic health records are really financial modules masquerading as clinical modules. Because if you’ve ever worked with any of the let’s say pharmacy modules or the surgical modules, there is a lot of work there and a lot that can be missed. And it’s very complicated. So that area takes up a lot of my team. So I have people that are specialists on my revenue integrity team. They understand how radiant the imaging charging inside of that. Think we have an op time person and a willow person, that’s the OR module and the drug modules. Or the pharmacy module. So we have people that understand those modules. And if they’re not Epic, if they’re something that’s an ancillary, we understand that as well. The last person must’ve have at least three or four lab systems at Cedars and we need to know how each of them work. We need to know how they’re sending us charges, when things need to be updated.

The creation process is one thing. The maintenance process is another. And you can be really good at one and not the other and you really need to have a rounded out program that’s good at both. So we have around 35 folks on our team. Some of them, instead of doing general charge audit that I mentioned earlier, which we’re looking at just by account by account that’s had sort of charge-based reimbursement, making sure we weren’t losing anything, have become more service line oriented. So I have a team that audits the emergency room instead of just globally all outpatient surgery cases because we’ve determined that that’s a greater area of risk and that the rest of the general, let’s say, outpatient surgeries are pretty much error free. I’ll put that in quotes, but there’s not a lot of loss there. But when you get into an emergency situation, even though we have leveraged the system functionality, there are still things that can be missed. Infusions is a huge one. We haven’t transitioned yet to automation around that. So what little charge capture we have left that’s manual is done by my team, a centralized team. So those are some of the ideas of the areas that we have.

Mike: And, Gretchen, what advice would you give someone who’s thinking about how to structure their own revenue department or just looking at revenue integrity generally as we work into the future?

Gretchen: Sure. One interesting statistic that I read earlier this year. And it came out last year from the advisory board. They were trying to define what RI is and how people work within it across the country. One of the questions that they sent was 84% of healthcare organizations rely, at least partly, on their EHR systems for charge capture. That’s big. That shows the major shift that we’ve all lived through now going from a manual charge capture environment to electronic. And we did have a lot of electronic beforehand, it’s just that it’s really significantly escalated with the implementation of EHRs. Then the next question they answered was 50% of healthcare organizations use it exclusively as their charge capture solution. So it’s 50/50. Some of them still have a little bit of manual, like I mentioned we do at Cedars, for example. But the one that blew me away was the percentage they gave of healthcare organizations that would recommend their current charge capture solution was only 10%. So it really makes you pause and say, “What’s so wrong?”

And I think the answer to that has a lot to do with what I’m seeing right now in the field, if you will. And I’ll get to that trend at the end of this question. But when you asked me what would I do to structure it? I would say work with what you have. Assess your department’s expertise and design your initial workflows around that. You’re going to have deficits in areas of expertise that you’re going to want. But that’s okay. You can either then grow your own expertise in those areas, slowly send your people to certification in charge capture, charge master and whatever electronic solution you’re using. It can be all done remotely now, obviously. It lends some authenticity to the roles as well as people get certified in these things. And it makes the career path more meaningful for a lot of these professionals because it’s slowly becoming an actual profession or discipline within the revenue cycle. Develop a culture that aligns revenue cycle operation, clinical administration, and IT with revenue integrity. Relationship building is probably the most important thing I can think of in creating a successful department. You’ve got to be able to call the head of pharmacy or their designee at any given moment and say, “What’s up with this drug? What is the dose unit? How is this built?” But you’ve also got to be able to call up the IT team because they’re the ones who are actually inputting data or changing things within the system. And we found and developed – and I would highly recommend this to other organizations – what we call weekly work groups with the same people I just mentioned as a part of those. So revenue integrity is the lead at these meetings but it’s got representation from all the modules and all the actual clinical areas.

So we don’t do all at one time. The best example is Willow, which is Epic’s pharmacy module. Once a week we have a call that includes my RI team, not the whole team but a couple of them. It includes clinicians, so pharmacists. It includes IT people as well as the hospital billing team. And we just go through issues. It’s the time we always say we have a chance to talk about the money. And these work groups, they’re not committees, they’re not task forces, we just wanted to fly low under the radar, it’s not a big deal, but it’s a chance where we get to work together to answer the questions of problem. Because, otherwise, you’re dealing with a situation where you have nothing but email communication and issues that are really too complex to follow in email get really lost over time. So we keep minutes, we have a work list that we’re working down. Things are kept on it until they are resolved, everybody’s aware of what their responsibilities are. And we knew we had to cater with these– this has been going on now at Cedars for several years. When the first call we had, had over 21 participants call in and we were shocked. But it was a perfect idea because it was a parking lot for issues that impact the rev cycle and revenue integrity but are really not in our control. We can’t go into the system and fix something. We rely on others. And we rely on other’s expertise, for example, a pharmacist. So these are some of the things that I would suggest about how you would want to structure and some of the work that you’d want to do. If it’s okay, I want to talk about a trend that I see and something we’ve done to sort of address it at Cedars.

Mike: Of course.

Gretchen: I also do some consulting with the Wilshire group. What I am seeing is people are reverting to old practices. Some hospitals are starting to revert back to manual workflows and it’s because, twofold, sometimes people grew too fast, especially systems. It’s understandable. They grew so fast they had to get it in and it didn’t work so well. And the problems they cannot seem to go to the next level so they just say, “Forget it. I’m going to pull it. I’m going to take it back.” Let’s say, for example, the HIM department in coding. So instead of leveraging system functionality, they’re reverting back to old practices. And example I like to give with this is cath labs. Cardiac cath lab. Huge revenue generating source for an organization. Complex coding, complex implantable devices. It’s expensive. What I see happening are people starting to pull codes out of the charge master where we call it hard coded. And they’re pulling it back into doc coding with coders. So what we’ve done at Cedars and it’s been super successful is myself and the executive director of HIM, we’ve worked together for years, came to an agreement; handshake. All right. We’re going to pull the CPT codes, etc. from the charge master and we’re going to trigger charges out of the system. We’re going to let the system post charges and everybody kind of gets really scared there because charges equal codes. And then we’re going to have the oversight by a coder to ensure the accuracy. So what you’ve done is you’ve gone from 100% manual process to leveraging the system to now pretty much having one FTE required to do the review. And of average, there is a 10 to 15 percent error rate. So you’re now only manually touching 10 to 15 percent to do correction to charges and codes versus having it manually posted 100% of the time. It’s just one example of real impact an RI program can have in both efficiency and reporting the revenue. And that’s just something we see a lot of the time, meaning that sort of reverting back to manual processes. And I just really want to encourage organizations to keep moving forward, keep using the system. Go deeper don’t go lighter and it’s been a big success for us I think.

Mike: Some really great insights, Gretchen. Thank you so much for coming by the podcast today and sharing all of that very detailed information about revenue integrity with our audience.

Gretchen: Thanks for having me. It was a pleasure.


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