Eligibility Software Saves Small Hospital Big Bucks

Revenue cycle software lessens back office strain, increases provider and patient confidence, and reaps monthly savings.

A tiny change to how a small hospital uses technology is resulting in big savings of between $3,000 and $10,000 a month.

Iroquois Memorial Hospital, a 25-bed facility in the eastern Illinois town of Watseka faced a problem. Patients were experiencing high deductibles and copays than in the past, found registering at the hospital to be increasingly nerve-wracking, as they were not able to be ascertain their total out-of-pocket costs until after claims were processed.

Meanwhile, the hospital, which is located 80 miles south of Chicago, had a problem of its own. It faced bumpy claims adjudication and a burdensome post-visit hospital collection process.

"In the past it wasn't so important that money was collected up front," says Rebecca Wright, vice president of strategic planning. "We tried to change that, [and] to change the whole entire revenue cycle. Before, it was always done in the back [office] after the patient left. We are now trying to move things to the front."

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In other words, revenue collection at check-in was insignificant.

But by implementing eligibility software, Patient Access from Availity, along with a healthy dose of patient and staff education, Iroquois was able to realize an average monthly savings of $3,000, Wright says.

The savings has spiked to $10,000 when the calculation includes a reduction in eligibility-related issues including claims rework previously required in the business office, as well as collections activity now avoided, she adds.

In the business office, the hospital's billing staff educated the registration staff, on what constitutes a clean claim, how important it is to have the correct information such as the correct insurance plan, and reviewing what it means "if a patient asks what a copay is, or a deductible, or co-insurance," Wright says. "We get a lot of that."

In addition, registration staff became more familiar with what the basic Medicare and Medicaid plans covered, and what the patient responsibilities are.

The Availity software shows hospital and ER registration staff a walk-in patient's eligibility in real time, including how much money is left on each patient's deductible, Wright says.

For scheduled procedures, including outpatient surgeries, the hospital's scheduling department can inform patients before the day of surgery what their estimated copays or percentage of charges will be. "It's no longer [about] the uncertainty of the cost of the procedure," Wright says.

On the check-in staff's screen, the Availity software is connected via an interface to the hospital's CPSI electronic health record software, and runs continuously in the background, popping up only when the staff reaches the eligibility determination stage, Wright says.

The software also provides prompts for staff as they engage in conversation with patients on how to take care of day-of payments, she adds.

Same-day payments afford patients a prompt-pay discount. Or staff can propose other of payment arrangements, or refer patients to speak with someone in patient financial counseling at the hospital, she says. "It's all prompted right in the system."

All of this leads to quicker check-ins and rising confidence of both patients and staff, Wright says.

"If you set that tone up front with our patients, it helps create that confidence for the entire visit for the patient, which is a really positive thing, she says.

As for the estimates the Availity software generates, Wright says they are "for the most part pretty accurate. Obviously you can't always estimate what exact drugs may be used during a procedure, or additional supplies that may be used. [But] for most common procedures, they're pretty close."

The software also leverages demographic data, combined with household income, net worth, and other financial indicators to predict a patient's capacity to pay.

For EHR clients who lack this sort of estimating and workflow capability, the solution Iroquois chose seems like a win-win technology proposition.