1. “Moments in the life of a zoo keeper” Keith Joyce
Hospital Leakage July 2008
“Moments in the life of a zoo keeper”
Keith Joyce

2. Hospital Benefit Outlays

3. Hospital Benefit Outlays
Looking For:
Abnormalities ie
State/Provider variations
Re admits (same site, different site, step downs)
Certificated services i.e. ICU, 3B
HITH

4. Hospital Leakage: MBS doesn’t cover i.e. cosmetics
Where Private bed charged with shared bed provided
What about per diems particularly Psych, public, rehab
Plus
Episodic, outliers, upcoding
Multiple admits in one year vs similar time for several years
High cost and or long stay

5. Rules Product black holes; Existing products Revised/new
Rules : Thelma
Eclipse
Availability of data to scope down into the BO VS online???

6. Contract Determines Where You Look
Capped Payment Systems – DRG or CEP Based
Depending on what is bundled into the capped payment determines whether there is any value in reviewing the payments
Some Funds bundle all costs bar medical and prostheses (variable inclusions) in its CEP (Casemix Episodic Payments) payments. Others might exclude ICU days from the bundling.
There is no point therefore with CEP episodes in examining, for example, ICU certificate classifications, or whether CMBS items link to OR bands, or excessive length of stay etc as the price is the price.
Fee for Service Systems
As the Industry still pays 30% (?) of all payments on a FFS basis (varies between Funds) some Funds do look at the above items, but ???????
As the number of services, and length of stay, and OR band and ICU classification etc all add to cost, then auditing of these cost inputs are important

7. Scope of Private & Public Hospital Leakage
The list below indicates some areas:
Claims of any type that are not allowed, because of Government regulations: cosmetic
Non contract (HPPA) compliant claims
Incorrect certificates eg ICU, 3B, C, B
Pre-existing ailments
Ex Gratia payments
Incorrect claims (wrong items, add on items etc), duplicates, etc
Incorrect invoicing because of upcoding or over coding (revenue maxn ?)
Incorrect automatic assessing due to weak or non existent controls and rules in hospital EDI, Eclipse, etc
Incorrect manual assessing due to mainframe system inadequate controls, reference tables, contracts, schedules, etc
Incorrect manual assessing due to poor assessor knowledge, keying errors etc
Over servicing ? Unnecessary servicing, hospital misadventures ?

8. Payment Compliance with Government Regulations and Hospital Contracts
No matter how you contract you need to ensure that:
Hospitals are billing correctly e.g.:
Capped systems – DRG coding & unbundled items e.g. prostheses
FFS systems - CMBS coding, OR bands, ICU levels, prostheses, outreach programs
FFS & not DRG where outliers are paid on an FFS basis
Services meet certification requirements e.g. types ICU category, C, B, 3B,
Assessors are assessing correctly FFS and not DRG and vice versa
System controls are working, reference tables are correct etc
Hospitals may have incorrect data depending on whether it is drawn from the OR, Patient Admissions, admitting doctor’s records, Finance department, etc

9. How Does The Industry Detect Hospital Leakage ?
Systems analysis to check effectiveness of system controls, product rules, business rules, accuracy of reference tables in the system etc
Targeted statistical analysis & benchmarking (claims, services, etc)
Hospitals
Fund Staff
Services
Contract compliance review
High dollar claims review to validate claims assessing
Chart to Bill audits for document validation of invoices
Hospital DRG coding audits to look for upcoding
Data Mining to find aberrant patterns in data
Random provider, staff & service items audits
Tip Offs (Members, Public, Staff, Other Institutions)
Member Surveys to validate services claimed
While some leakage can be prevented proactively, there will always be a need for retrospective analysis because systems can’t verify the claims elements upfront eg certificates

10. Skilled Teams: Expertise: Coders, Claims assessors, Nurses, Medicos,
Para – legal
Systems

11. Skilled Teams: cont Member confirmations of:
Service using clear messages
Independent contractor – why? + National focus plus additional skilled resources – resource as needed
Providing approx 90% response
MPL level: 200/year contacting 100 members each review
Streamline the process, educate agents, minimize push back
Support compliance reviews – National focus i.e. Thelma

12. New World:
E Business
System reviews, sample selection (letters sent/outbound calls), proof of service, PRIVACY??
Politics – State, Federal, Hospital Owners vs PHI appetite

13. Outcomes: Member Value: Why do we do it? – Recoveries/behaviour
PHI sustainability of product/value proposition
Barriers:
Politics - Internal & External
Vs lines in the sand!

14. Logical Steps: Privacy (contracts, Publics, DHS (State & Feds)
Communications, Media/Retail/Call Centre
Internal high level support
External – PHIO
Evidence is power
Mount the internal case

15. Summary:

16. QUESTIONS