When it comes to managing the revenue cycle, David Kanzler takes a pragmatic approach-he outsources a good chunk of it. “The management of billing and collections has become so sophisticated and technical that it’s hard to justify doing it ourselves,” says Kanzler, the CEO and CFO of Hinsdale (Ill.) Orthopaedic Associates, a 25-physician group practice which provides a wide range of procedures including sports medicine, total joint replacements, hand surgery and spinal fusions.

Four years ago, Kanzler turned over all post charge-capture activities to Chicago-based Origin Healthcare Solutions. The practice codes its services, then hands over claims submission and related follow-up activities to Origin, explains Margarita Cuadra, revenue cycle director. “Billing gets more difficult every year,” Kanzler moans. “And payers come up with new and novel ways to reduce payments and deny claims. So I need to leverage the expertise of a company thinking about this 24 hours a day.”

In an industry laden with revenue cycle woes, Kanzler has plenty of company. While not everyone outsources the work to the extent Hinsdale Orthopaedic has, most providers bemoan what they describe as the growing complexity of managing the revenue cycle. The hurdles are many, from a proliferating number of payer edits-particularly from Medicare-that define the documentation required to justify payments to ever-increasing financial obligations being handed over to patients-obligations which providers must collect. Then there are disparate clinical and financial information systems.

Outsourcing the back-end of the revenue cycle is always an option. Many providers have no qualms about surrendering a chunk of their revenue to a firm well-versed in dealing with claims submissions, denials and appeals. But only so much can be outsourced. That’s why providers are increasingly revamping their workflows on the front-end of the revenue cycle to avoid downstream delays and denials. Talking with patients upfront about their financial obligations is a new segment of workflow for many, one that requires a cultural shift and newly defined staff roles.

In essence providers are taking a longitudinal approach to the revenue cycle and working more closely with the clinical departments whose documentation drives it. Some are consolidating their financial and clinical systems in an effort to streamline front-end charge capture. Others are using revenue cycle dashboards to monitor the cash flow and identify possible bottlenecks. No one finds it easy-and emerging fee-for-value payment models are adding more uncertainty to the entire revenue food chain.

Managing the revenue cycle is now front and center in the industry. But it wasn’t always that way, says Steve Matteson, vice president of Pittsburgh-based Simpler Consulting, whose services include revenue cycle analysis, workflow mapping and system implementations. “In 2009, after the financial crisis, everything changed,” he says. “Before then, faith-based providers did not want to talk about money, but today all our health care clients want to start with the revenue cycle. It can be very convoluted.”

Matteson usually spends a week just mapping out an organization’s revenue cycle workflows, documenting all the steps required and the staff involved. “The number of people, the amount of time, and the dollars involved are great,’ he says. “Clients don’t have the end-to-end view. Charge capture is a big source of leakage. CFOs worry about it, but they don’t know where the holes are.”

Orlando Health, an eight-hospital delivery system in central Florida, is among those providers taking an expanded view of the revenue cycle. “In the past we’ve focused on improvements in financial systems and processes,” says Tom Yoesle, chief operating officer, revenue management, at Orlando Health. “Now we’re looking at clinical systems and where we can improve data feeds and the numerous data elements” that drive reimbursement.

One major effort has revolved around revamping high-dollar order sets in such areas as cardiology and chemotherapy. Many claims wound up denied, and the revenue cycle staff had to focus on working the denials. Orlando Health is attempting to build in stronger medical necessity rules in its ordering process to either steer physicians to lower-cost (and covered) options or clarify the documentation needed to justify higher-cost drugs. “We are always looking at standard orders that spawn medical necessity issues, denials and appeals,” he says.

But all that work only reduces-not eliminates-the degree of difficulty, Yoesle emphasizes. “You can set up a great order set, but Medicare changes the rules on a dime,” he says, referencing the “edits’ that CMS regularly disseminates as part of its ever-changing landscape of documentation requirements and payment policies. Orlando runs an inpatient EHR from Allscripts, which feeds data to its registration and billing system from QuadraMed. Getting the systems in synch requires a high level of cooperation between clinical departments and the revenue cycle staff. “You have to bridge the knowledge gap between the revenue cycle and the clinical management,” he adds.

Yoesle says revenue cycle issues span both “low-hanging fruit,” or issues that are relatively easy to fix, and “great, big audacious ones,” namely big-ticket claims that wind up getting denied. Orlando Health is tackling both, he says.

The low-hanging fruit included expensive drugs ordered as part of infusion procedures. Physicians were ordering procrit injections for anemic cancer patients and those undergoing major surgery, among others, and they’re an expensive treatment that often isn’t covered. “Physicians might have ordered it in their practice and had it covered. But it is a different requirement when you are ordering the test to take place in the hospital,” Yoesle explains.

To handle a likely denial, Orlando began monitoring the scheduling of procedures using the drug and then giving feedback to physicians about how extra documentation would be required to meet medical necessity rules for the procedure.

Controlling outlays for big-ticket chemotherapy drugs has proven to be a tougher challenge, Yoesle says. To address the problem, Orlando revamped order sets used in chemotherapy and oncology. The pharmacy staff played a big role, in writing precise, bulleted information points to add to the order sets. The bullet points clarify the documentation needed to support given drugs and also suggest lower-cost alternatives. “Laying that out in a clean order set is crucial,” Yoesle says. Many of the chemo claims wind up being denied by Medicare. In a recent month, some $256,000 was denied based on medical necessity, or about 20 percent of the chemo claims, Yoesle estimates. “We did a great job modifying chemo orders and increasing communication between pharma, case management and physicians,’ he says. “But we were still seeing denials.”

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