Related Links

Web Seminars

Banks are starting to show providers some love via new services geared toward straightening out the maddeningly complex revenue cycle. That's the good news. The bad news is that the revenue cycle is and will remain maddeningly complex until banks, providers and payers find some common ground around EOBs and 835 remittance advice transactions.

Officials from U.S. Bank and Luther Midelfort Mayo Health System (an affiliate of Rochester. Minn.-based Mayo Health System) explained just how tough that can be during a presentation at the Financial Systems Symposium of the HIMSS 2010 Conference & Exhibition in Atlanta.

Luther Midelfort was U.S. Bank's first customer for the Healthcare Receivables Solution comprising revenue cycle services.  The partnership was ultimately a success, but only after working through a few setbacks and longer-than-expected implementation times.

Automating the revenue cycle was a critical need at Eau Claire, Wis.-based Luther Midelfort, according to Anita Whitcome, director of billing services. The manual, line-item posting of 835 remittances in the patient accounting system was taking the staff 57 to 64 hours per lockbox. In addition, Whitcome found that the 10 people who processed EOBs interpreted those EOBs differently, which led to chronic A/R discrepancies.

On the other side of the table, payers weren't doing Luther Midelfort any favors by sending non-HIPAA-compliant 835 remittance transactions and EOBs that provided widely disparate data sets and came in numerous different formats.

U.S. Bank's services include working with payers to create compliant 835 transactions, digitizing paper documents still coming in and automating the processes to link payments with remittances, explained Jim Moynihan, senior vice president in the U.S. healthcare payments group at U.S. Bank.

"When data and money are sent separately, they have to be put back together," Moynihan said. "We want to create 'funded' transactions that enable providers to re-associate that money and remittance data in their patient accounting systems, and do so without human intervention."
But Deborah Pung, senior product manager at U.S. Bank, noted that it doesn't come easy due to the variables of patient accounting systems and the quality of payer data coming in.

For example, Luther Midelfort's patient accounting system couldn't post HIPPA-compliant ERA with claim-level adjustments--the posting logic required service-line details. And some payers don't provide enough information on their EOBs to create a postable 835 transaction. In addition, payers' EOB formats sometimes differ by geographic region, so U.S. Bank's technology partner had no experience with the EOB formats used by payers for providers in Minnesota and Wisconsin.

"All these variables led to an implementation timeline at Luther Midelfort that was much longer than anticipated," Pung said. "In addition, we had shortened our test phase to hit our initial implementation timeline, and that led to templates that weren't thoroughly developed and tested. The result was errors in the 835 file that were posted to the patient accounting system, and not providing the correct patient responsibility in the system."

The project eventually got back on course, Pung said, but U.S. Bank learned to focus more attention upfront on posting logic of patient accounting systems, and do more granular testing on the entire spectrum of payer transactions, on a payer-by-payer basis.

--Greg Gillespie