Stop Patient Identity Related Revenue Leakage
By Karen Proffitt MHIIM, RHIA, CHP, Vice President Data Integrity Solutions
Hospitals may finally have broken even in April after 12 consecutive months of operating in the red and suffering billions in pandemic-related losses, but finance executives remain laser-focused on revenue growth and retention – including putting a stop to revenue leakage wherever possible. That includes rooting out what are often unexpected sources as part of a holistic revenue cycle management (RCM) strategy.
Case in point: inaccurate patient identification and information.
As we noted in our white paper, People Matching in Healthcare: Challenges, Impact, and Solutions, patient misidentification issues cost the average healthcare facility $17.4 million per year in denied claims and lost revenue and cost the U.S. healthcare system over $6 billion annually. According to the Ponemon Institute, about 35% of denied claims incurred by hospitals each year can be attributed to inaccurate patient identification or inaccurate/incomplete patient information, adversely affecting both cash flow and AR days.
The impact of poor patient identification on the bottom line goes beyond revenues. A survey from HIMSS and Patient ID Now found that healthcare organizations spend an average of 109.6 hours per week resolving patient identity issues. Over half spend 21-80 hours per week and have an average of 10 full time employees dedicated to patient identity resolution. More than one-third said they spend more than $1 million annually on identification resolution, including the cost of full-time employee salaries and benefits, technology, and software. Only 18% said they spend less than $250,000 a year.
The Duplicate Problem
When patient misidentification leads to duplicate or overlaid patient records, the problem runs even deeper. It can lead hospitals to file claims or bill patients for the wrong amount, resulting in lost revenues, but it also forces them to incur the costs associated with correcting both the patient record and incorrect claim/bill, increases days in A/R, slows cash flow, and causes more bad debt write-offs. An incomplete medical record can also hamper efforts to correct and resubmit rejected or returned claims.
Duplicate and/or incomplete patient records can also hinder quality efforts and metrics that drive value-based payment formulas. For example, incomplete patient records can lead to providers failing to recognize at-risk patients and missing opportunities to proactively schedule screenings or treatments, while incomplete information can contribute to clinical errors and adverse events that can reduce Medicare payments and/or reimbursements under value-based payment models.
Duplicates can also contribute to an increase in avoidable readmissions and related penalties, as well as impact patient satisfaction scores and make it more difficult for hospitals to accurately calculate quality metrics.
The Clean MPI Impact
When it comes to stopping revenue leakage and protecting revenue integrity, an important addition to any RCM strategy is to achieve and maintain a clean MPI/EMPI leveraging technology that enables continuous end-to-end protection by operating in multiple environments and at multiple stages throughout the patient record process.
The most impactful platforms use advanced deterministic and probabilistic matching algorithms to analyze and clean patient data before a record is updated or duplicate created – and before the misidentification can contaminate downstream systems including billing and collections.
Ultimately, investing in a robust MPI management system as part of a hospital’s RCM strategy delivers a rapid ROI by protecting cash flow and patient experience, providing accurate patient data to avoid costly delays and enabling more accurate management of high-risk patients with a longitudinal record. All of which stops revenue leakage and protects revenue integrity.