INCREASING HOSPITAL POS COLLECTIONS Project for the Lean Six Sigma Green Belt course 1 | P a g e Copyright 2016, Simplilearn, All rights reserved. Contents Introduction ..................................................................................................................................................2 Data tables………………………………………………………………………………………………………………………………………………4 Exercises ……………………………….…………………………………………………………………………….………………………………….6 2 | P a g e Copyright 2016, Simplilearn, All rights reserved. Introduction Holistic Health Systems (HHS) operates 39 hospital facilities and clinics. The executive team has been reviewing key metrics over the last year and identified a need to improve Point of Service Collections, or simply known as POS (pronounced "P-O-S"). POS is a patient payment that is received within 7 days of discharge. Increasing POS is important for HHS because hospitals are 60% less likely to receive payment once the patient leaves the hospital. The cost of collecting on the patient’s account continues to go up while the chance of actually collecting payment goes down if there is a delay in collecting the payment after the patient’s discharge. Therefore, it is better to not delay collecting the payment. Increasing POS reduces bad debts, provides a better cash position, reduces expenses, and increases patient satisfaction when conducted properly. POS is calculated by dividing POS payments by the total patient cash collected. HHS has identified the industry median benchmark for POS as 13.6% and the top 10% POS benchmark as 41.4%. HHS’s current POS performance is 35.6%, and the executive team has determined that a 5-percentage point increase is needed to stay competitive (target = 40.6%). A Lean Six Sigma team was formed. POS is a metric that heavily relies on the Patient Access team, or PA. PA is responsible for several tasks—patient scheduling, registration, and financial clearance. The "scheduling" tasks are typically completed by a centralized PA team for multiple hospital facilities. During scheduling, PA reps receive a doctor’s order for a patient. The order is like a permission slip for specific medical services the doctor deems necessary. The doctor or even the patient related to the order can call scheduling to reserve an appointment for the services that correspond to what is written in the order. PA reps need to verify that the order is complete and accurate, coordinate time for services, and provide patients with pre-service instructions. After the patient’s information is logged into the scheduling system, 3 | P a g e Copyright 2016, Simplilearn, All rights reserved. it will be queued up for the PA registration team to complete the registration process. The PA will call the patient and confirm their identity and collect demographics such as address, family, emergency contact, etc. The patient's health insurance provider(s) will also be confirmed as part of the PA registration process. PA registration can be completed at a hospital facility or by a centralized team. Lastly, PA Financial Clearance will verify patient health benefits to ensure they exist and to determine if the procedure or service for the patient is covered. If authorization is required, the PA Financial Clearance will request authorization for services from the patient’s health insurance provider. Services performed without authorization lead to rejected claims. Also, during PA Financial Clearance, the PA rep will counsel the patient about their liability (how much their insurance provider says they need to pay for the services) and collect the payment. Any payment received is considered POS since it’s before 7 days post discharge. Financial clearance can also be performed at the hospital facilities or by a centralized team. Summary patient cash data for HHS’s 39 hospital facilities for a year is presented in Table 1. The table also indicates if the PA team for each facility is centralized or not. Table 2 provides an overall monthly trend for POS performance. The team identified the facilities with POS performance above the target and researched the activities they have in place, hoping to find commonalities or key drivers. They are: • ensure proper patient education on benefits and liability • ask for payment • have a financial counseling policy • reduce number of patients that leave without financial clearance • have accurate tools to help estimate patient liability or responsibility • utilize devices that allow patient collections at the patient’s bedside 4 | P a g e Copyright 2016, Simplilearn, All rights reserved. Data Tables Table 1: 2015 POS by Facility Facility POS Payments All Patient Payments POS% Centralized Teams FVR $1,372,015 $6,860,076 20% Yes LAK $1,301,746 $3,348,748 39% Yes PLA $2,964,730 $6,854,164 43% Yes CGH $625,428 $1,709,452 37% Yes FLO $849,646 $2,141,211 40% Yes DEL $2,324,347 $7,824,857 30% Yes GSM $2,621,784 $9,710,312 27% Yes PBG $1,713,107 $6,062,173 28% Yes SMH $5,936,564 $10,355,241 57% Yes HIA $1,215,112 $2,250,807 54% Yes PGH $2,234,134 $5,395,099 41% Yes MAN $1,311,286 $3,611,438 36% Yes MOD $2,997,636 $7,494,091 40% Yes WBO $2,273,401 $8,743,852 26% Yes LOM $2,358,653 $8,133,287 29% Yes BAR $1,457,038 $5,286,184 28% Yes DES $2,676,236 $9,581,654 28% Yes IND $1,076,377 $2,979,026 36% Yes DHW $2,145,483 $5,249,186 41% Yes ECH $2,428,480 $7,833,806 31% Yes HHH $2,253,084 $7,080,683 32% Yes SCH $548,628 $1,739,024 32% Yes GBH $2,455,353 $7,262,268 34% Yes BMC $3,486,532 $13,946,130 25% Yes CYF $4,534,470 $10,796,357 42% No DHF $2,416,085 $4,624,894 52% No FRH $2,182,243 $6,929,016 31% No HNM $5,600,722 $12,446,048 45% No LPX $3,379,727 $9,134,398 37% No NMC $1,946,885 $4,378,487 44% No PMC $2,885,804 $9,188,848 31% No PPH $1,969,620 $3,939,240 50% No PRV $6,015,807 $12,253,503 49% No SES $1,940,017 $4,971,199 39% No SFH $3,254,250 $7,850,558 41% No SIE $3,051,755 $6,999,804 44% No SRM $2,658,292 $10,909,840 24% No SVM $1,606,482 $6,573,344 24% No TWI $1,297,858 $5,225,755 25% No 5 | P a g e Copyright 2016, Simplilearn, All rights reserved. Table 2: 2015-2016 POS Trending POS Payments All Patient Payments Jan-14 $8,198,401 $22,105,614 Feb-14 $6,409,335 $20,449,785 Mar-14 $7,452,507 $25,357,473 Apr-14 $7,853,058 $24,320,414 May-14 $7,277,931 $24,815,250 Jun-14 $8,975,992 $20,309,240 Jul-14 $7,349,353 $24,904,346 Aug-14 $6,804,829 $23,349,092 Sep-14 $7,898,465 $20,829,620 Oct-14 $7,888,816 $18,506,142 Nov-14 $5,834,679 $17,386,881 Dec-14 $9,021,591 $18,659,237 Jan-15 $8,717,536 $18,956,764 Feb-15 $6,623,228 $19,008,749 Mar-15 $7,696,772 $22,971,163 Apr-15 $8,312,773 $23,437,612 May-15 $9,028,170 $21,358,646 Jun-15 $7,436,050 $22,168,016 Jul-15 $7,852,119 $21,971,590 Aug-15 $6,933,100 $23,650,610 Sep-15 $8,623,086 $26,860,403 Oct-15 $7,850,627 $21,346,585 Nov-15 $7,691,110 $23,004,295 Dec-15 $8,602,245 $22,939,623 6 | P a g e Copyright 2016, Simplilearn, All rights reserved. Exercises Read the case study and then answer the following questions. Exercise 1 Process Stability Using the data given in Table 2, determine if the POS performance is stable using a control chart. Explain why you used the type of control chart you selected. Exercise 2 Scope Opportunity Using the data given in Table 1, how would you scope the focus area of the project? Exercise 3 Testing a Theory Use the data from Table 1 and conduct a hypothesis test to determine if centralized teams impact POS collections. Exercise 4 Solution Categories Based on the information provided, what could be the affinity categories for the key drivers that impact POS performance? This project is a part of your assessment. Good Luck!