Roughly a year after Holy Cross Hospital began an ill-fated implementation of a billing system that tied up thousands of dollars in uncollected payments, hospital administrators are now hiring a new …
Roughly a year after Holy Cross Hospital began an ill-fated implementation of a billing system that tied up thousands of dollars in uncollected payments, hospital administrators are now hiring a new billing consultant in an effort to get the cash flowing again.
Accounts receivable, money owed by patients and insurance companies, has been whittled down slowly this year, but financials provided by Holy Cross this week showed that just over $8 million remained uncollected in net accounts receivable.
Reports from patients indicate that bills aren’t reaching their insurance company, or their mailboxes, until several months after receiving services at the hospital in some cases.
Holy Cross CEO Bill Patten said many of those delays have been due to compatibility issues between their former billing consultant, Resolution, and their office management system, called Evident.
“With Resolution, we got someone who knew how to do billing, but they didn’t really have the expertise we needed to do it on our computer system,” Patten said.
An interim “revenue cycle director” Patten brought on this fall recommended the hospital transition to another consultant, Tru Bridge, a sister company to Evident.
“By being a sister company, they will have a better understanding of our current system,” Patten said. “They will be able to ensure the system is configured correctly and will be able to educate our staff to use it efficiently.”
Aside from the usual growing pains company personnel experiences when moving from one system to another, Chief Financial Officer Steve Rosenboom explained that the systems a bill must move through to reach a payer are extremely complex and must work together fluidly.
“How data flowed through the new system was different and not well understood when we made the conversion (in 2017),” Rosenboom said. “As primary insurance paid, how the bill then transitioned to self-pay or secondary insurance was different, and we had difficulty understanding how this process worked and adapting to it.”
Holy Cross’ simultaneous conversion to a critical access hospital also contributed to the delays.
While it went through that change, the hospital also acted on a recommendation from Medicare to switch their National Provider Identifier – a 10-digit identification number issued to health care providers for government reimbursements. While Rosenboom said this simplified record keeping at the hospital, it further complicated billing with “virtually all other payers, including Medicaid,” a major source of reimbursements at any health care facility.
The hospital’s fiscal intermediary, Novitas, had to update its systems due to the ID change, delaying all Medicare payments by almost two months, along with any other bills that flowed through secondary payers.
Making matters even more complicated, any bills that had been filed under the old “acute care hospital” designation between July 20 through Oct. 1, 2017 had to be identified, canceled and rebilled under the new critical access designation. Rosenboom said some of the old bills weren’t canceled and rebilled for up to a year after the original date of service.
In the medical world, how long a bill can linger at a facility before a payer can refuse payment is limited. Medicare has a one-year limit, according to the Centers for Medicare and Medicaid Services while Blue Cross Blue Shield, for example, allows only six months.
So how much money did Holy Cross lose due to these delays?
Out of a total $59 million billed so far this fiscal year, Rosenboom estimates that Holy Cross has written off around $76,000 due to delays in timely billing, though he notes that most of this loss was taken in fiscal year 2017.
The total amount listed as “uncollectible” as of the most recent September financial report is much larger, at just under $24 million.
In addition to delays in accounts receivable payments, however, that number also includes bad debt, charity and contractual allowances: the difference between what Holy Cross bills to insurance companies and what it actually receives.
Patten described the contract with Tru Bridge as the “final step” in resolving these costly billing problems, but how long it will be before that transition is completed and what impact it will truly have on the hospital’s financial health, remains to be seen.
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