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Revenue cycle, health IT tools are vital as patients pay more

By Jennifer Bresnick

- As the Affordable Care Act (ACA) takes hold in a big way and accountable care models ask patients to take more financial responsibility for their health and well being, the adoption of revenue cycle management (RCM) tools has become the next critical chapter of the health IT implementation saga.  Providers who have finally settled into using their EHRs are finding that significant gaps in their business processes are allowing revenue to leak away, and are starting to take action to plug the holes.  For some providers that rely heavily on the collection of frequent and increasingly large patient co-pays, such as physical therapy (PT) and rehabilitation organizations, these gaps may make the difference between staying in the black and dipping into debt.

Kennedy Hawkins, President of the National Association of Rehabilitation Agencies and Providers (NARA), and President and General Manager of PT Northwest, a multi-site system of physical therapy providers on the West Coast, sat down with EHRintelligence to discuss how the changing role of patients underscores the importance of RCM technology in the PT and rehab world.

What are some of the unique RCM challenges faced by PT and rehab providers?

Cash flow is everything in any healthcare business.  As a physical therapy provider, some of the unique challenges we have in terms of revenue cycle management is ensuring that cash flow continues to come through the door.  In physical therapy, we see a lot co-pays that can range anywhere from $10, if you have a great plan, up to $50. That’s little bit different, maybe, than a physician office, because we’re seeing patients multiple times per week, oftentimes for a month or more.  Making sure that we collect those co-pays is significant, because a lot of times, that is our margin on the visit.

How has the Affordable Care Act changed the way you have to do business?

Under the ACA, we’ve seen a significant cost shift towards patients, where the coinsurance amounts are higher.  Their deductibles might be up to $5000, so one of the things we’ve seen on the rehab side is that patients are definitely much more price sensitive about receiving care. But for us, the more we can receive from those patients upfront, the more our cash flow is enhanced.

One of the fundamental things the Affordable Care Act has done is the significant cost shift that’s going to move towards patients and make them more responsible for the choices that they make.   More than ever, providers are going to have to broadcast that message about why they’re doing what they’re doing, and the patients are going to have to make choices about what they’re going to do with their hard-earned cash.  So not only do they do have to choose to come in to see us, and choose to keep coming to see us, but then we also have to have systems in place to collect those payments for our own sustainability, as well.

How has implementing revenue cycle management software made the process of collecting revenue easier?

Using revenue cycle management software means we pretty much always know where we’re at in the collections cycle.  In real time, I can look at everything due to an integrated database.  And I think the biggest benefit is having that integrated into our EMR, because it makes everybody from clinic directors to administrators aware of these issues.  It used to be seen as more of a back office administrative issue, but now I think everybody realizes that this is something that affects all of us, because if we’re not collecting the patient responsibility part of our reimbursements, that definitely negatively impacts the business.

How are you engaging patients in their care to ensure they achieve their goals?

We’re working on securing more buy-in from patients for physical therapy, because it is different than going to a physician’s office.  Rehab requires active participation.  We’re going to make you work.  Not every patient really likes that idea, but one of the biggest things that we’re working on right now is to convince our patients of the value of therapy as a unique medical discipline and why it’s important for them to continue their plans of care.

Because one of the things that we see right now, definitely because of higher the coinsurance and co-pay amounts, is that they’ll say they’re feeling 60% better or 70% better, and they’ll think they’re good enough, so they’ll stop coming in.  So we’re trying to get the message across that if they don’t complete a plan of care, they’re setting themselves up for a relapse or recurrence if they didn’t sufficiently strengthen the muscle group or whatever is involved in their care plan.  We’re trying to really encourage our patients to understand the value of not only what we do, but how it impacts their health in the long term.

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