Prospecting for prospective payment software - how to choose an efficient patient management software

Nursing Homes, May, 1999 by David Patterson

Patient management software has been an increasingly important issue in skilled nursing facilities (SNFs) for a number of years. But prospective pay and RUGs-III have made it an issue critical to the survival of SNFs. Bad data transmitted to Medicare can mean wrong or no payment. In the new world of prospective pay, data collected and conclusions drawn have to be on target from day one.

That makes accurate preadmission decisions the linchpin for both cost control and care planning that maximizes positive outcomes and patient comfort. A good computerized patient record has always begun with high-quality preadmission screening, and now a good computerized patient record can mean the difference between success and failure for both facility and patient.

For SNFs, the information acquired and the assessments made prior to admission cut three ways: (1) First and foremost, they guide the creation of a solid patient care plan. (2) Good assessment and a solid care plan mean that when the patient is admitted, he or she will be correctly categorized under RUGs-III and will therefore yield billings that cover the cost of treatment. (3) Knowing a patient's complete care needs in advance lets a facility know whether it is well equipped to meet those needs. A patient who requires care markedly different from the norm offered by a facility is not likely to be best served in that facility; it may be that the facility will have to start redefining its market.

The new requirements have put greater pressure than ever before on facilities to computerize and have all the parts of their computerized record keeping - cost analysis, accounts receivable, care planning, pharmacy, etc. - fully compatible with one another. It has become very hard to argue against an integrated system from a single supplier.

When choosing integrated software, it is especially important to evaluate whether a package's preadmission screening module is the right one for your facility. So much of a facility's potential profitability is based on the quality of information obtained in this process and how it is analyzed that the importance of this module cannot be overstated. It should have a computerized inquiry form. Diagnoses should be able to be entered quickly and flexibly. You need to be able to determine therapies, treatments, and medications and to be able to project outcome and predict length of stay accurately.

From the preadmissions information, you should be able to point-and-click your way to a day-by-day cost analysis. This needs to be done prior to admission, because you have to answer the question of whether the prospective patient falls into a RUGs-III category that the facility is well equipped to handle within the context of its day-to-day operations. If the screening aspects of a piece of software do not feel right, if they do not yield information that is quickly and easily assessed, and if that information does not transparently plug in to your overall cost analysis, don't buy that software.

The goal is to be able to determine in advance a successful plan of care and treatment that fits snugly into a RUGs-III category. All of that simply cannot be done by hand. Good, integrated electronic data collection and assessment by computer-facile healthcare and business personnel will make the difference.

That said, the bad news is that it is rare for integrated software to function equally well in all areas, and there is no reason to think this will be any different in the generation of software now reaching the market with its claims of prospective pay, MDS 2.0, and RUGs-III efficiency. On top of that, you know the regulations will change over time.

Purchasing a system is, in any case, a process of compromise, with a basic understanding of the important essentials. To my way of thinking, screening and cost analysis are going to be the crucial areas for Medicare postacute management in the foreseeable future. It's possible that an individual skilled nursing facility or company will weigh other factors, such as ease of use, equally in its software purchasing decision making. For any organization, the most crucial areas of software functionality depend on that organization's management priorities and culture.

I would, however, under any set of circumstances, look for software that solves 85 or 90% of my problems. Your best chance at achieving that is by performing a strong needs assessment up front. Fail to do that and you will most likely spend lots of money foolishly, ending up with a system that runs the risk of being all but nonoperational. The first rule of software purchasing should be written down: "Be well prepared; you get what you pay for if you buy carefully."

Now, more than ever, the purchasing of long-term care management software is a complex process requiring knowledge and study. If you have neither the knowledge nor the time or inclination to make that study, hire someone who does.

When purchasing an integrated package to address your RUGs-III and prospective pay needs, look for a company that has been in business for a while, has put its software through at least two revisions, is willing to make modifications - for a price - to meet your specific needs, and will share a long list of satisfied clients with you. Do not try to "cheap it out." The days when you could get someone with a little computer knowledge to tinker with standard database programming language and create "something that would work" are over. There is, however, still room to bargain.