Community Benefit: Raising the Bar through People, Partnerships and Technology UPMC Patient Financial Services Center April Langford MedAssets Julie Kay

Overview Objectives Community Benefit: The industry status About UPMC Environmental conditions Identifying the need Key indications Executing Action Process, Technology and Partnerships Current outcomes Lessons Learned Final thoughts 2

Objectives Understand how UPMC confronted their Community Benefit initiatives Identify innovative and creative ways for performing community-focused initiatives Learn how technology and improved processes can impact community outreach. 3

Community Benefit: Industry Status Patient Protection and Affordable Care Act (PPACA) Community Health Needs Assessment Financial Assistance Policy Tax Exempt Status Threatened Patient Financial Management Social Service vs. Collection Effort Detailing Program Practices Identifying Outcomes Sharing the impact with the Community 4

About UPMC Integrated global healthcare enterprise headquartered in Pittsburgh One of the largest non-profit health systems in the nation Hospital and Community Services –Hospital and Community Services – 20 tertiary, community and specialty (Psychiatric, Women’s Children’s) hospitals, 400 outpatient sites PhysicianPhysician – nearly 5,000 physicians with privileges at UPMC hospitals, including more than 3,000 employed InsuranceInsurance – UPMC Health Plan has over 1.6 million members and covers commercial, Medicare Medicaid, CHIP, behavioral health, employee assistance and workers’ compensation segments International and Commercial ServicesInternational and Commercial Services – exporting knowledge and expertise internationally with footprints in Italy, Ireland, China, and Japan Transformed the economic landscape in Western Pennsylvania 54,000 employees; largest employer in Pittsburgh

The UPMC Corporate Revenue Cycle (CRC) manages all facilities in an integrated model FY11 Results: Net Patient Service Revenue$4.1B Annual Cash Collections$4.1B Annual Claims Processed4.2M Clean Claims92.5% Average Days in AR34 % A/R >90 Days5.7% Denials0.8% Denial Direct Write-Offs0.1% Uncompensated Care to Gross Revenue2.63% FTEs378 Average Revenue per FTE$10.87M

UPMC Patient Financial Services Center 7 The UPMC Patient Financial Services Center was designed to assist uninsured and underinsured individuals and families in finding financial solutions for medically necessary services. We developed our Patient Financial Services Center such that caregivers and patients can access financial services and counseling throughout the entire continuum of care.

UPMC Patient Financial Services Center: Identification of Need 8 National Indicators*: Beginning in 2014, the American Recovery and Reinvestment Act will extend MA eligibility to all Americans under age 65 whose family income is at or below 133% of federal poverty guidelines. PA State Indicators**: Pennsylvania’s uninsured population showed an increase in the past year from 9.7% to 11% of the overall population. UPMC Specific Indicators: Increasing Self Pay Population and Patient Balances Increasing Uncompensated Care Uninsured/underinsured individuals may not be aware of programs designed to provide financial assistance. * **2011 America's Health Rankings® by the United Health Foundation

Uninsured Population of Pennsylvania 9 Data taken from America's Health Rankings® by the United Health Foundation. UPMC Patient Financial Services Center: Identification of Need – PA State Indicators

UPMC Patient Financial Services Center: Identification of Need – UPMC Specific Indicators 10 39% Increase since FY09

UPMC Patient Financial Services Center: Identification of Need – UPMC Specific Indicators 11 18% Increase since FY09

UPMC Patient Financial Services Center: Identification of Need – UPMC Specific Indicators 12

UPMC Patient Financial Services Center: Positive Outcomes 13 Patient qualifies for Medical Assistance Patient qualifies for UPMC Financial Assistance Patient obtains other funding from programs such as: Victims of Violent Crimes Leukemia & Lymphoma society National Breast and Cervical Cancer Early Detection Program Cash collection increases as patients qualify for external funding Cash collection increases as patients make payments Affordable and manageable payment plans are set up Individual’s credit rating is protected from bad debt collection efforts

UPMC Patient Financial Services Center: Negative Outcome 14 Patient sent to Bad Debt due to inability to pay

UPMC Patient Financial Services Center 15 Points of Referral Obtain MA for Patient Provide Financial Assistance for Qualified Patients Pre Arrival Post Service Point of Service UPMC PFSC Primary Initiatives Create Effective Collection Process Referrals to the UPMC PFSC occur along the entire continuum of care, and a proactive approach is taken to ensure that all uninsured/underinsured patients are identified as soon as possible. After the patient is referred to the UPMC PFSC, a specialist will work with the patient to determine if they qualify for Medical Assistance, Financial Assistance or have the ability to pay. They will then work with the patient to assist in the application process and/or set up a mutually agreeable payment plan.

16 Early identification of individuals with financial need enables us to properly refer patients to the appropriate financial services program. Uninsured/Underinsured patients are identified in our pre-arrival center via our ePayer Insurance Verification and Self-Pay worklists. Onsite Case Managers or Social Workers identify uninsured/underinsured patients presenting to sites and call or the UPMC PFSC to notify specialists of the patient’s financial situation. If patients are unable to pay, co-payments, coinsurance and any other outstanding patient balances at the point of service, referrals to the PFSC are initiated. UPMC PFSC specialists reach out to the patient and work with them to pursue program/payment options. The goal is to reduce “Elective” Bad Debt and to minimize financial risk to UPMC and the patient. Proactive Identification of Uninsured/Underinsured Patients and Patient Responsibility - Workflow

Proactive Identification of Uninsured/Underinsured Patients and Patient Responsibility - Technology 17 The UPMC eEligibility electronic Insurance Verification system identifies patient responsibility pre-arrival and automatically posts patient responsibility into the patient accounting system for collection at point of service. Our UPMC Self-Pay electronic worklist identifies uninsured/underinsured patients prior to service. We can then reach out to patients and initiate steps to secure payment and/or initiate financial counseling. Criteria for qualification to the UPMC PFSC Self-Pay Electronic Worklist: All Uninsured patients are automatically added to the worklist All Auto patients are automatically added to the worklist Underinsured patients are referred from the pre-arrival insurance verification worklist via a transfer button Workers’ Compensation with no Secondary Insurance Medicare Part A Inpatients with no Secondary Insurance

Proactive Identification of Uninsured/Underinsured Patients and Patient Responsibility - Outcomes 18 Insurance Coverage Identified 59% Referred to UPMC PFSC41% –MA Eligibility Approved / Pending55% –Financial Assistance Approved / Pending24% –On-Going Internal Collection Process18% –Payment Collected 3% Pre Arrival Uninsured/Underinsured SDS and Outpatient Radiology - Combined

19 Non-Emergent Uncompensated Care as a Percentage of Total Uncompensated Care 37% Decrease since Nov 10 Proactive Identification of Uninsured/Underinsured Patients and Patient Responsibility - Outcomes

20 219% Increase since Feb 2010 Proactive Identification of Uninsured/Underinsured Patients and Patient Responsibility - Outcomes ePayer automatically gets Patient Responsibility information from Payer Portals and posts it into the patient accounting (PA) system for POS collections Collection efforts are tailored based upon Propensity to Pay Segmentation posted in PA System Scripting is provided to Registrars for various scenarios Patients who cannot pay are referred to the UPMC PFSC via phone, , fax, and documentation in the PA system.

21 We use 5 selected vendors to assist Inpatients during the Medical Assistance application process We created an internal Medical Assistance Eligibility team to assist Outpatients during the Medical Assistance application process. Determining a patient’s eligibility for alternative coverage sources is a major piece of the UPMC PFSC workflow. We start the process with evaluating the patient’s eligibility for their state Medical Assistance Program. Most states have a 90 day retroactive eligibility period so it is crucial to identify potentially eligible patients quickly. Medical Assistance Eligibility - Workflow

22 Uninsured patients are provided with a specialist to facilitate the Medical Assistance application process. Specialists complete and submit the Medical Assistance application on behalf of patient and act as a liaison with the Medical Assistance office to attempt to gain eligibility for the patient. The process ensures that applications are submitted quickly and completely. Specialists assist patients throughout the entire application process. They follow up with the Medical Assistance office and the patient to verify that all documentation is submitted. UPMC’s Medical Assistance eligibility work tool (eMA) monitors this process, both internally and externally, ensuring that applications are processed in a timely fashion and that thorough follow-up is completed. Medical Assistance Eligibility - Workflow

Medical Assistance Eligibility - Technology 23 eMA – Medical Assistance Eligibility Worktool eMA actively identifies uninsured/underinsured patients and ensures appropriate follow up during the MA eligibility process. eMA also identifies individuals who have been eligible for medical assistance within the past two years, pregnant women, and children with chronic illnesses and automatically adds them to the worklist for contact and financial counseling. eMA enables Medical Assistance specialists to contact patients prior to or quickly after their service, to increase the likelihood of eligibility. eMA highlights the status of the account in the eligibility process, enabling Medical Assistance specialists to easily track individual accounts and initiate data driven process improvement efforts to expedite eligibility.

Medical Assistance Eligibility - Technology 24 eMA – Medical Assistance Eligibility Worktool

25 Medical Assistance Eligibility - Technology eMA – Medical Assistance Eligibility Worktool

Medical Assistance Eligibility - Outcomes 26

Medical Assistance Eligibility - Outcomes 27 Changed Referral Criteria to EXCLUDE Balances <$1000 Started Internal MA Process

28 In FY11, we referred 11,522 Patients* to MA Of those 11,440 closed applications for patients referred to MA… 7,303 patients, or 64%, were approved for MA 4,137 patients, or 36%, were denied MA. Of those denied MA… MA APPROVED MA DENIED 2,144 patients, or 52% were denied as Over Income 1,993 patients, or 48% were denied as Uncooperative Positive Close Negative Close $50,507,572 in MA cash was received 7.28% Cash** 85.72% FA W/Os 7.00% BD W/Os 83.86% FA W/Os 7.12% BD W/Os Results of MA Eligibility Process 9.02% Cash** *Includes IP and OP Referrals **Includes Patient, Insurance, and Out for Collection Payments Medical Assistance Eligibility - Outcomes

UPMC Financial Assistance Eligibility - Workflow 29 As soon as we determine if an uninsured/underinsured patient is not eligible for Medical Assistance, we evaluate the patient for the UPMC Financial Assistance program. UPMC PFSC Specialists work with the patients to complete the application and collect all required documentation necessary to make a determination for financial assistance. By helping the patients navigate this process, we are able to ensure that all qualifying patients are able to get necessary financial help.

UPMC Financial Assistance Eligibility - Workflow 30 Patients may be eligible for UPMC Financial Assistance for medically necessary services if they: Have limited or no health insurance Can demonstrate financial need Provide UPMC with necessary information about household finances Financial assistance is not available for: Insurance co-pays (excluded unless the co-pay balance is a hardship) Financial assistance is typically not available for: Deductibles When a person fails to comply reasonably with insurance requirements (such as obtaining authorizations and/or referrals) For persons who opt out of available insurance coverage International patients

UPMC Financial Assistance Eligibility - Workflow Financial Assistance Eligibility Income Guidelines Family Size Income equal to <= 200% the of Federal Poverty Level* equates to 100% Financial Assistance Balance Forgiveness for the Patient Income equal to 201% to 400% of Federal Poverty Level* equates to 85% Financial Assistance Balance Forgiveness for the Patient 1$21,780$43,560 2$29,420$58,840 3$37,060$74,120 4$44,700$89,400 5$52,340$104,680 6$59,980$119,960 7$67,620$135,240 8$75,260$150,520

UPMC Financial Assistance Eligibility - Outcomes 32 Over 200 More Applications Received per Month in FY 12 than FY11

UPMC Financial Assistance Eligibility - Technology 33 eFA – Financial Assistance Eligibility Worktool

UPMC Financial Assistance Eligibility - Technology 34 eFA – Financial Assistance Eligibility Worktool

UPMC Financial Assistance Eligibility - Outcomes 35

Identification of Patient Ability to Pay – Workflow Self-Pay Segmentation 36 When the patient enters our Self-Pay automated predicative dialer system for collections, they are immediately segmented into one of 6 segments, directing the workflow of the collection process. We strive to prevent patients who have the ability to pay from being referred to bad debt at all costs. We work with patients to explore every avenue to obtain payment from alternative coverage sources and set up affordable payment plans.

Identification of Patient Ability to Pay – Workflow Self-Pay Segmentation 37 Segment 1: High Propensity – Previous Payment at UPMC or Collection Agency Segment 2: Medium Propensity – New Patient or Patient on Payment Plan Segment 3: Low Propensity – No Payment History at UPMC or Collection Agency Segment 4: All Balances < $100 Segment 5: Financial Assistance – Approved w/o Application Segment 6: Financial Assistance – Approved w/ Application or Currently Applying

Identification of Patient Ability to Pay – Outcomes Self-Pay Segmentation 38 Internal Score - Based Upon Payment History Vendor Score<$100 A-FA Approved B-Account in Bad Debt F-Applied for FA I-Active Installment Plan N-New Patient P-Previously made paymentNo ScoreGrand Total , , , , , , ,292 Balance <$10019,716 No Score 2561, ,1645,6628,80018,295 Total19, , ,1707,0089,06647, % of referrals to UPMC PFSC are identified through scoring

UPMC Financial Assistance Eligibility - Outcomes 39

UPMC Financial Assistance Eligibility - Outcomes 40

UPMC Financial Assistance Eligibility - Outcomes 41

UPMC Patient Financial Services Center: Self-Pay - Outcomes 42 FY11 TOTAL Bad Debt Adjustments Row LabelsGrand Total% IP Emergent$24,417,32019% IP Non-Emergent$5,790,1434% OP Emergent$69,950,61553% OP Non- Emergent$31,950,78824% Total$132,108,866 FY12 TOTAL YTD Bad Debt Adjustments (Annualized) Row LabelsGrand Total% IP Emergent$12,368,51513% IP Non-Emergent$3,448,1704% OP Emergent$55,180,19658% OP Non- Emergent$23,919,97025% Total$94,916,851 UPMC PSFC Opportunity – Bad Debt

UPMC Patient Financial Services Center: Essential Partnerships 43 The presented outcomes would be impossible to achieve without effective and mutually beneficial partnerships with the following: Patient Access – Insurance Verifiers On-Site Staff – Registrars, Case Managers, Social Workers UPMC PFSC Specialists Vendors County/State MA Office CFOs and other Operational Leaders And most of all, Our Patients

Overall Results 44 Key IndicatorFY11FY12 TDImprovement Average Monthly Point of Service Cash Collections$266,042$375,06841% Average Monthly Referrals to MA2,5453,05820% Average Monthly Referrals to FA3,0123,2297% Average Monthly Write Offs to FA$29,240,439$36,623,07020% Average Monthly Write Offs to BD$11,009,073$7,285,240-51% Financial Assistance as a % of Uncompensated Care73% 0% Bad Debt Write Offs as a % of Uncompensated Care27% 0% Average Montly Patient Cash Collections$8,008,117$8,950,07411%

Final Thoughts 45