Waves of efficiency: Midwest healthcare system forgoes the traditional document management fix and instead pursues a BPM solution to bolster its revenue cycle improvement

Health Management Technology, Feb, 2005

Like many large health networks today, Sisters of Mercy Health System faced the "perfect storm" of providing high-quality patient care despite the challenges of declining reimbursements, a tight and costly labor market, rising numbers of uninsured patients and escalating operating costs.

Braving this storm required an increase in cash flow for rapid reinvestment in delivering quality care. The organization recognized the limitations of nonintegrated health information management (HIM) solutions that were impeding its ability to capture the financial benefits of true integration. This led Sisters of Mercy to take a quantum leap and re-engineer its entire approach to revenue cycle management by applying business process management (BPM) fundamentals to streamline workflow and improve overall productivity.

St. John's Mercy Medical Center is a member of Sisters of Mercy, a large Midwest IDN with 19 facilities in four states and 3,100 medical staff members. Based in St. Louis, St. John's Mercy encompasses two acute care facilities of 1,000 beds and 200 beds, as well as an integrated primary care physician practice organization and a health services unit providing occupational, hospice, home care and other outreach services.

Sorting Out Solutions

Initially, St. John's Mercy considered imaging and document management software for registration, HIM and its central business office. The organization researched several vendors' solutions for imaging storage and retrieval. But after a careful analysis, the hospital broadened its focus beyond the simple elimination of paper into a more complete evaluation of business processes that contributed to the challenges it wanted to overcome and arrived at BPM.

BPM is the general term for the services and tools that support explicit process management, including support for human and application-level interaction. It can define effective business processes for everything from a single department to an entire enterprise with its associated value networks. This function can range from the basic automation of a single manual process, such as accounts payable, to a line of business or an overall business, such as policy underwriting. BPM is employed to extend the value of related technologies such as workflow management, process modeling, messaging and collaboration within an organization, and also to integrate newer technologies such as Web services and enterprise application integration.

In 2002, St. John's Mercy selected and implemented Automated Work Distributor (AWD), a BPM solution from DST Technologies, a division of DST Systems Inc., a $2.4 billion company based in Kansas City, Mo. The hospital's specific goal was to improve customer service, accuracy, sharing of resources, automation and compliance by integrating existing HIM solutions under the umbrella of a BPM framework.

BPM did not replace departmental software solutions at St. John's Mercy, but rather connected its existing solutions more efficiently. This approach leveraged St. John's Mercy's existing investment in technology by continuing to use its current financial and clinical systems. The BPM focus improved the business processes within its current application systems and resulted in seamless revenue cycle management across the organization.

Streamlining the Revenue Cycle

St. John's Mercy currently applies BPM in three key operational areas:

Admissions and registration. The system begins at the registration desk by scanning patient identification and insurance information directly into the patient records system, eliminating duplication of efforts at each subsequent patient encounter. Additionally, the department receives bed requests by phone and fax, which are automatically imported into the DST solution. This expedites the fulfillment process, streamlining communication among various departments.

Health information services BPM has eliminated paper filing, retrieval and manual distribution of medical records by providing staff with simultaneous electronic access to imaged records and documents from the central repository. The system also routes records for analysis, coding and electronic physician signature. The health information services department generates revenue by quickly fulfilling and billing for medical record requests.

Central business office. The system includes a denial management function which automatically creates and routes failed claims reports and partial payments or denials. These improvements to the failed claim process at St. John's Mercy, have resulted in a two-day reduction in net days in accounts receivable.

With this new BPM system, staff in all three of these key' operational departments can simultaneously access revenue cycle data to complete their work. Improved access to data and improved processes have eliminated manual work and increased productivity.

For example, coding is now performed more accurately and quickly. This allows bills to be processed faster and speeds the time to capture revenue. Prior to implementing BPM, one employee could code between 400 and 500 charts per day. After the implementation, that same employee can now code up to 900 charts per day, about a 100 percent improvement.