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Explosive HFMA Meeting at Stonewall

Inside this issue:

President’s Message—Danielle Heston-Raddish

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Strategic Pricing With A Focus On The Market

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Welcome New Members

8

Red Flag Rules 10

WV Chapter Awards 2010 ANI

12

Certification Program 12

Member Spotlight 14

October 2009 West Virginia Chapter Newsletter

Mountain Talk July 2010 Issue

The West Virginia Chapter of HFMA held their May Education Session at the

Stonewall Resort in Roanoke, WV. It was an outstanding meeting. Many topics

were covered from HITECH with CMS to ethics. The annual installment of officers

was held on during dinner on Thursday evening. There is a listing along with contact

information of all of the board members later on in the newsletter.

On the last day of the conference there was an accident in the Resort‟s restaurant

while breakfast was being served. A large refrigerator that was adjacent to the main

dining area was having mechanical problems. A repairman was working on the com-

pressor when it exploded. There were a couple of employees the suffered minor in-

juries. The entire complex was evacuated and all guests were sent into the parking

lot until all the danger had passed. Many guests came out in their night clothes and

parents with their small children still in PJs. The local fire departments responded

along with EMS to ensure the area was safe. The guests remained outside for almost

2 hours. The HFMA members took it all in stride and turned a bad situation into a

good time. Door prize drawings were held and a lucky winner walked off with a gi-

ant giraffe. After a short while the Resort moved the HFMA meeting to the Club

house on the hill. Transportation was provided and the meeting went on. It was a

very lucky day for all of the guest and the employees. The Resort was very accom-

modating during this chaotic time and sent letters of apologies to the guests that

were affected by the inconvenience. Who says we are not exciting…

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Fellow WV HFMA Members,

One of my first opportunities as this year‟s WV Chapter President was attending the

HFMA ANI in Las Vegas. As we have come to expect, the educational sessions were great.

George Will and Chris Gardner gave thought provoking presentations that I am still reflecting

on as I write this President‟s Message weeks later.

One of the highlights of ANI was Debora Kuchka-Craig, the 2010-2011 HFMA Chair

introducing her Chairman‟s theme. Her theme “Step UP” sounds rather simplistic but is really a

challenge to all of us, both professionally and personally. Debora defines her message as “…

taking time to see the big picture in health care – to avoid being overwhelmed with our day-to-

day work and see the opportunities available for the industry as a whole.”

This time in healthcare is challenging, exciting and historic (and as many other adjec-

tives as there are people reading this letter). As healthcare finance professionals, this time re-

quires us to be on top of our game. We are challenged to Step UP by being more efficient, more

responsive and more creative with our resources.

I hope you will look to the HFMA for answers to your questions, education regarding

reform and fellowship when you need a counterpart to brainstorm with.

As an HFMA member you have resources available to you both nationally and on the

local level via the national and chapter websites, the hfm magazine, educational webinars and

live education events. I encourage you to access these tools and maximize your membership.

On a personal level, I am looking forward to this year with anticipation. Our Chapter has

sustained several years of growth and success. The volunteers, sponsors and chapter leadership

are working hard to continue improving educational offerings, communication and your mem-

bership experience. If you are inclined to Step UP into a volunteer or sponsorship role, you will

be welcomed into a great team.

I look forward to seeing you at the September meeting in Morgantown and encourage

you to visit the Chapter website for dates and de-

tails about all this year‟s education offerings.

Take care,

Danielle

President’s Message – Danielle Heston-Raddish

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Strategic Pricing with a Focus on the Market

Generating additional third party payments and improving the overall profile of your hospital‟s prices

relative to the market is possible. By strategically setting prices in the context of the prices in the market,

additional third party payments can be generated and a better price profile achieved.

Strategically setting prices means using the charge sensitivity of a charge/service code to influence how

its price is changed. Charge sensitivity is a measure of how much third party payments change for a given

change in price. Setting prices in the context of the prices in the market means the prices of other hospitals

are considered when developing new prices. Finally, the price profile describes the distribution of your

prices relative to the prices of the other hospitals in terms of percentiles (e.g. percentage of your prices be-

tween the maximum price and the 75th percentile, percentage of your prices between the 75th and 50th percen-

tiles, etc.).

Conducting a strategic pricing project with a focus on the market is a significant undertaking but one that

can be worthwhile. A high level of computer model building skills is required and experience working with

the Charge Description Master (CDM) and revenue and usage files is extremely helpful. The approach for

conducting such a project has many components. However, based on our experience, there are six key com-

ponents of a successful approach.

Key Component 1 - Setting the Parameters for the Project

There are various parameters that influence the development of the prices when prices are established strate-

gically. Some of the critical parameters include, but are not limited to, the following: the targeted change in

gross revenues, maximum allowable price increase, minimum prices and whether prices for the same ser-

vices should be equalized.

Some of these parameters affect how the pricing model is constructed. As a result, they need to be estab-

lished early in the process.

Key Component 2 - Defining the Market

The market consists of the hospitals that will be used as benchmarks for price comparisons. This market

needs to be defined. The market could be hospitals within a certain geographic area, hospitals of similar size

within a certain geographic area or similar hospitals throughout the entire country. The last definition for the

market might be most appropriate for specialized hospitals. Once the hospitals have been identified, their

prices can be obtained from various vendors.

Key Component 3 - Working With the Benchmark Data

Hospital pricing data may not always be robust. There may be minimal or no hospital prices for some of the

charge/service codes in your CDM. A decision needs to be made as to how these situations will be ad-

dressed. Possibilities include using the prices of other hospitals or multiples of third party reimbursement

rates as the benchmarks for price comparisons.

Another aspect of working with benchmark prices that needs to be considered is outliers. A benchmark hos-

pital‟s price is an outlier if it appears to deviate markedly from the prices of the other hospitals. A decision

needs to be made as to whether outliers are going to be identified and excluded from the analysis. If they are

going to be identified and excluded, a definition of an outlier needs to be established.

By Mark Jeziorski, Sophical Solutions

4

Continued

Strategic Pricing with a Focus on the Market

Finally, benchmark prices are not current and could be more than a year old. These prices can be used as is or a

trending factor can be applied to them in an effort to estimate current prices. Each of the two approaches has its

benefits and pit falls.

Key Component 4 - Having a Comprehensive Scope

The benefits derived from the project are directly related to the scope. The benefits will increase as the scope of

items included in the project increases. In order to generate the maximum amount of benefits, the scope should

include items in the CDM with CPT/HCPCS codes, room and board charges, items charged on the basis of time

(e.g. operating room charges, recovery room charges, etc.) and cost-based items (e.g. pharmacy, pharmaceuticals,

supplies, implants, etc.).

Key Component 5 - Developing a Pricing Model

A critical component of the successful approach includes developing a sophisticated model that is able to accu-

rately calculate changes in payments that result from changes in prices. The model should incorporate the bench-

mark prices, managed care contract terms, historical usage at the charge/service code, patient type, plan code and

service/registration area level and claims data to address “lesser of” and “stop loss” contract provisions. The

model should be designed to develop initial prices that optimize third party payments given the set of constraints

(e.g. maximum increase in gross revenues, prices not exceeding a certain level, prices not going below the mini-

mum prices, equalization of prices for charges codes with the same CPT/HCPCS code, etc.).

Key Component 6 - Review of Every Price from the Model

Models are wonderful tools that provide tremendous benefit in the realm of strategic pricing. However, models

are not perfect. Some of the imperfections are due to the benchmark data and some are due to the high cost of de-

veloping more sophisticated models that require less intervention. As a result of these imperfections, a review of

every price generated by the pricing model should be conducted. The review should include, but not be limited to,

checking that items are leveled appropriately (e.g. CT with contrast is priced higher than a CT without contrast).

Another Consideration

Hospitals receiving Medicare outlier payments may want to determine the impact of the new prices on outlier pay-

ments and the cost-to-charge ratios. In fact, these hospitals may want the new prices be developed such that addi-

tional third party payments are generated without impacting the amount of outlier payments. Incorporating the

impact of pricing changes on outlier payments and cost-to-charge ratios will add another layer of complexity to the

process.

Conclusion

Strategically setting prices while focusing on the prices in the market can result in additional third party payments

and an improved profile of prices. A successful approach that has been utilized to achieve these results involves

six key components. For hospitals receiving Medicare outlier payments, the approach could also include deter-

mining the impact of the pricing changes on outlier payments and the cost-to-charge ratios or establishing prices

that do not impact the amount of outlier payments.

About the Author

Mark Jeziorski is President of Sophical Solutions. Mark can be reached at markj@sophicalsolutions.com.

mailto:markj@sophicalsolutions.com

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Ron K Davis Jeremy Taylor

Sales Manager Information Systems Coordinator

Healthcare Financial Services Saint Francis Hospital

304-388-6865 304-347-6121

ron.davis@camc.org jeremy.taylor@stfh.net

Harold D. Gunter, II

Cardiopulmonary Manager

Pocahontas Memorial Hospital

304-799-7400

hgunter@pmhwv.org

Calendar of Events

Fall Education Meeting WaterFront Place, September 29-October 1, 2010 Morgantown, WV Revenue Cycle Workshop Sutton Days Inn October 28, 2010 Flatwoods, WV Winter Education Conference Towne Center Marriott January 26-28, 2011 Charleston, WV LTC New Orleans, LA May 15-17, 2011 Region 4 Mid Atlantic Pipestem Resort May 24-27, 2011 Pipestem, WV ANI Orlando, FL June 2011

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Fall Meeting something to laugh about!!

Come join us in Morgantown

September 29 – October 1, 2010

The WV HFMA is proud to announce Comedian Josh

Copen will be joining us during our meeting that is

being held in Morgantown.

Incredibly funny, Josh Copen is stand-up comic,

originally from Kingston WV. Josh shares with us the

stories of his childhood, making everyday life lessons

incredibly funny. Josh has worked with many great

comic during his career, including Louis Ramey (Last

Comic Standing), Jesse Joyce, Tim Wilson and TJ

Miller. Please plan to attend and laugh with us!!

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Red Flag Rules: A Good Idea for Healthcare

By Bruce Nelson, Vice President, SearchAmerica

If you are like most healthcare financial professionals, you have first-hand knowledge of countless patients

who used another identity to procure their medical services. Perhaps they stole an insurance card from a

family member, or simply borrowed a stranger‟s driver‟s license to cover the costs of elective surgeries, or

much worse. Either way, your organization and the rightful owner of the identification were violated, and

most likely left with a large hospital bill that would never be recovered.

Identity theft is prevalent and on the rise. The Federal Trade Commission (FTC) is taking an important step

to combat this trend, not only in healthcare, but across financial and lending institutions with its Red Flag

Rules and its deadline of November 1, 2008. The Rules apply to any organization, not just healthcare, that

extends credit to individuals through a multi-payment plan or covered account.

Some view this regulation as yet another government requirement. I urge you to instead view the Rules as a

catalyst to implement changes in your hospitals that will protect you and your patients from identity theft

and is an impact on your bottom line.

To comply with the Rules, companies must submit their written program to identify and manage „red flag‟

accounts by November 1, 2008. Each program needs to meet certain details on how your organization will

identify, detect and respond to patterns, practices, or specific activities – known as “red flags.”

Step One: Identification / Detection of Red Flags

Hospitals need to accurately identify every patient by validating their demographic information (address,

age, social security number, etc.) using a reliable, third party source. Inconsistencies can constitute a „red

flag‟ and immediately notify the registrar that something is amiss with this patient account.

Likewise registrars should be able to view accurate patient information, such as age, to make a visual vali-

dation. For example if the patient appears to be in their 20s, but the validated patient information is that of a

60-year old, the registrar should „red flag‟ this account.

Over the years, our customers have found that using outsourced financial clearing solutions at registration

identifies problem (or red flag using the FTC‟s terminology) accounts and also provides more accurate in-

formation for billing and collection purposes. These systems can correct information that is simply keyed

into the system incorrectly or data that mistakenly offered without motive, as well as those trying to per-

petuate identity theft.

Complying with the rules and automating this step provides the independent, unbiased, consistent process to

validate the identity of each and every patient that enters the hospital.

However, detection is just the first step.

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Red Flag Rules: A Good Idea for Healthcare

Step Two: Response to a Red Flag

Once a „red flag‟ is detected due to inconsistent patient information, each hospital must have a policy stat-

ing its response processes. The processes should include an automated workflow that is launched when in-

consistent data is given, whether it is recognized and identified by a system (e.g., wrong address) or the reg-

istrar (e.g. patient doesn‟t fit the age specified). In either case, a scripted process that walks the hospital staff

through this situation is necessary.

Responses should consist of both trained staff and automated systems to aid them in their workflow. The

system should prompt them to ask pointed questions to ascertain if the error is innocent or not, and they

should be appropriately trained on how to manage the conversations in a professional manner, directing the

patient to the appropriate manager or authority as needed. Healthcare networks will likely find that these

processes may differ by hospital, patient type (self-pay, insured, etc.), or service center.

Next Steps

Once these steps are completed, a hospital needs to provide administrative oversight of its Red Flag Rules

response by its Board of Directors, and have a plan to periodically reevaluate its identity theft processes and

the effectiveness of its current process.

The FTC‟s Red Flag Rules provide a smart and rationale framework for organizations to minimize identity

theft within their customer base. This is good for consumers/patients, and their providers alike.

Compliance with this government regulation will extend additional benefits to your organization through

reduced bad debt and less account aging due to accurate patient information (or identity theft detection) at

the onset of your financial relationship.

For more information on the FTC‟s Red Flag Rules, visit http://www.ftc.gov/idtheft

Other Websites for Information:

Federal Deposit Insurance Corporation (FDIC)

www.fdic.gov

Federal Reserve System

www.federalreserve.gov

National Credit Union Administration (NCUA)

www.ncua.gov

Office of the Comptroller of the Currency (OCC)

www.occ.treas.gov

Office of Thrift Supervision (OTS)

www.ots.treas.gov

Continued:

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WV Chapter Awards at 2010 ANI

The West Virginia Chapter was successful in obtaining three awards for 2009 – 2010.

We were awarded the Silver Award of Excellence for Education, a Helen M. Yerger Award for the Joint Meet-

ing with Central Ohio, and a Helen M. Yerger Award for our participation in the Region IV Mid-Atlantic

meeting in Ashville, NC.

Jan Strope, Immediate Past President, accepted these awards on behalf of the Chapter at the 2010 President‟s

Dinner. Also in attendance from our Chapter were President Danielle Heston-Raddish and Board Member and

Program Co-Chair Lisa Simmons.

The WV Chapter of HFMA is running a special campaign this year. Our goal is to have at least 2 members take a certification exam. National HFMA has added taking exams for certification to the Chapter Balanced Score Card for 2009/2010. The certifications that can be obtained are Certified Healthcare Financial Professional (CHFP) and Fellow of the Healthcare Financial Management Association

(FHFMA).

Earning your certification will:

Validate your specialized knowledge and technical expertise

Enhance professional credibility within the industry

Differentiate your level of expertise

Demonstrate exceptional commitment to professional development Don‟t forget you can also earn CPE for completing the self study courses.

10.0 hours for the Core Program

13.0 hours for Accounting and Finance

9.5 hours for Patient Financial Services

10.5 hours for Physician Practice Management

14.0 hours for Managed Care The Board of Directors purchased 2 sets of study guides for the exams to be shared among the members. The guides pur-chased are as follows for the 2009/2010 year: 2 copies of the core study guide, 2 copies of the PFS guide, one copy of the Ac-counting and Finance guide and one copy of the managed care study guide. Please contact Danielle Heston-Raddish if you are interested in borrowing the guides. The Chapter will also reimburse Chapter members who successfully pass a certification exam if not reimbursed by their em-ployer.

Certification Program

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Member Spotlight

Personal:

Name: Lisa A. Simmons MA, CHAM

Title: Manager of Financial Applications

Hospital & website: West Virginia University Hospitals, Inc.; www.wvuh.com

Colleges attended: Marietta College – BA; West Virginia University – MA

Additional designations: Emergency Medical Technician, EPIC Certified – Cadence and Integrated Referrals

Current HFMA Member?: Yes. I also serve on the Board of Directors and am the current

Program Chair. I have previously served as the Revenue Cycle Chair as well.

About Your Hospital:

What is new and exciting at your health system?

We recently opened a new Heart Institute that is a hospital based clinic with supporting ancillary services. We are

also continually improving our new EPIC clinical and financial information system. Finally, our facility was just

re-designated as a Magnet Hospital.

What is it like to work for your health system?

This is a progressive organization that wants to provide the best possible care to our patients. It also offers exten-

sive learning opportunities for our medical staff and employees. We strive for this to be a place that our public is

proud of and would recommend to others for both healthcare needs as well as employment.

What are some of your department or organizational goals this year?

Customer satisfaction, upfront collections, A/R below 50 days and denials reduction.

About Your Career:

What is your business philosophy?

To be consistent and fair at all times.

What is the best way to keep a competitive edge?

To stay informed on what is happening in the industry and to be active with our professional organizations that

support healthcare.

How do you measure success?

It is measured by looking at the success of the organization not just one individual. It takes a team to make proc-

ess improvements work.

What are your biggest accomplishments in the last 24 months?

The successful go-live of our new clinical and financial information system (EPIC). We replaced many old legacy

platforms with one common front-end system. This allows us to have the clinical and the financial system all in

one place to better service the patients and providers.

http://www.wvuh.com/

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What goal have you set, but not yet achieved?

The patient access department staff hitting their goal of one million dollars in up- front collections for the year.

What has been your toughest business decision?

To leave my job as Manager of Patient Access (which I held for 23 years) and take the Manager of Financial Ap-

plications position. I now have a chance for professional growth in the healthcare finance and information tech-

nology areas.

What has been your biggest business lesson learned?

People are your best resource and you need to treat everyone the same from the lowest to the highest position in

the hospital. Everyone plays a role in the overall success of the organization.

What is your career advice?

Be excited to come to work each day and strive to make a difference.

What do you like least about your job?

Sometimes there are just not enough hours in the day to get it all done.

What do you like most about your job?

I am still amazed that after 23 years in this field that I still learn something new every day.

When you were a kid, you thought you would grow up to be a teacher! (I actually did for a very short time. I was certified to teach K-8 in health and social studies)

More About You:

What is your pet peeve?

Dishonest people.

What are you greatest passions in life?

My family and traveling.

What is your favorite quote?

"Be more concerned with your character than your reputation, because your character is what you really are,

while your reputation is merely what others think you are."

- John Wooden

What is your favorite book?

The Bowden Way: 50 Years of Leadership Wisdom by Bobby Bowden

Member Spotlight

Continued

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What is your favorite movie?

Letters to Juliette.

What is your favorite way to spend your free time?

Traveling, photography, live music and dancing.

If you could meet anyone, who would it be?

Princess Grace.

If you could change one thing about yourself, what would it be?

I am ok with exactly who I am at this very minute.

About HFMA:

What do you like most about HFMA?

The ability to network and learn from my peers.

What is your favorite HFMA event or memory?

Most of my favorite memories have to do with the wonderful people that I have met thru the organization, suc-

cessful education sessions and some amazing speakers. Receiving the Bronze and Silver Awards from HFMA

were also very memorable.

What can HFMA do to make itself better?

Get all the membership involved and participating in educational meetings. The organizations strength comes

from its members.

.

Member Spotlight

Continued:

Be on the watch…

You may be the next

Spotlight.

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West Virginia Chapter – HFMA

2010-2011 Corporate Sponsors

EMERALD LEVEL HealthCare Financial Services

RUBY LEVEL Arnett & Foster PLLC

West Virginia University Hospitals

SAPPHIRE LEVEL Advanced Patient Advocacy

Helvey & Associates

Mountain State Blue Cross & Blue Shield

ParrishShaw

Quadax, Inc

Wells Fargo Insurance Services

Dixon Hughes, PLLC

The MASH Program

Humana, INC

PEARL LEVEL NCO Financial Systems

United Collection Bureau

The Wellington Group, LLC

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Page 17

President

Danielle Heston-Raddish 304-624-2960

Vice President

Keith Morgan 304-346-0441

Secretary

Sandy M. Michaels 240-818-9792

Treasurer

Marlon G Taylor 304-526-2073

Board Members

Belinda Bennett 304-469-8620

Lisa Ann Simmons 304-598-6247

Okey Silman II 304-473-2127

Jay Richmond 304-388-6250

Lisa Simmons 304-598-6247

Bring a friend to the next HFMA meeting!!

Join today at

hfma.org/join.

Committee Name: Chairs Members Advisory Jan Strope Susan Cunningham Linda Dugan

John Byrne Mary Ann Brown

Alex McFadden Jim Holden

Awards Jill Epstein Board Officer and Directors Past Presidents

Danielle Heston-Raddish

Belinda Bennett

Sponsorship Alex McFadden

Brenda Glaspell

Financial Review Outgoing President Incoming President

Outgoing/Incoming Treasurer

Angela Coburn

Internet Steve Meadows Keith Morgan

Member Services Linda Dugan Joan Namay Sonja Raddish

Candi Powers Susan Cunningham

Okey Silman

Mid Atlantic Julie Shaw

Newsletter Jason Deem

Belinda Bennett

Program and Entertainment Lisa Simmons Diana Cesa Carol Haugen

Jill Newberry Leslie Harclerode Jay Richmond

Susan Cunningham Tracy Gooden

Sandy Michaels Norm Mosrie

Ryan Lindsay Mary Ann Brown

Revenue Cycle Okey Silman Belinda Bennett Sonja Raddish

Candace Powers Steve Meadows Donna St. Clair

Okey Silman II