Revenue Optimization Case Study

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The Client

A private, not-for-profit hospital with comprehensive services in the Southeast with more than 1,000 beds and over $1 billion in annual net revenue.

The Challenge

The hospital partnered with Change Healthcare to ensure they were capturing all reimbursement. They had an internal contract modeling system that handled all underpayment issues and denials. They believed the internal system worked well and revenue leakage was minimal. However, they suspected there was an opportunity to optimize reimbursement.

The Solution

Through a proprietary contract modeling system and intelligent analytics, Change Healthcare confirmed the limitations within the client’s internal systems. The Audit and Recovery services reviewed all claims previously paid or denied over the past two years. The expert team identified previously undetected underpayments due to clinical documentation and coding conflicts, then worked with payers to reclaim those funds.

Within 45 days of contract signature and implementation, Change Healthcare delivered more than $1 million in cash remittances for the provider.

Approximately 40% of the underpayments were denials. Despite the prior reviews by internal teams and by another revenue cycle vendor, the Change Healthcare denial analytics and expert staff were able to recover additional payments from these accounts.

The partnership expanded and Change Healthcare began to also manage new denials while continuing to collect on zero balance accounts.

The Change Healthcare clinical experts leverage payer relationships and a deep knowledge of case management to achieve successful appeals, including medical necessity, level of care, authorization, and DRG downgrades. Furthermore, the denial and appeal experts can identify why those denials are occurring.

Outcomes

The client was amazed when the Change Healthcare team delivered more than $1 million in lost revenue within 45 days. After this initial success of recovering lost revenue, the client expanded the relationship to include the Denials Management program.

Each year since, Change Healthcare has consistently delivered approximately $8 million dollars in revenue annually that would have otherwise been lost.

The revenue improvements were enhanced by the exponential value of process improvements identified by Change Healthcare. As a true partner, Change Healthcare met with the client on-site monthly to present solutions to revenue cycle challenges. The team provided detailed reporting and root cause analysis that identified process defects. This intelligent analytical insight drove process improvements for prevention and also reduced aged accounts receivable, bad debt, and denial write-offs.

There is typically a one-to-one value of uncovered revenue and money saved from process improvements identified by the proprietary analytics platform. In this case, that means the client improved overall net revenue by 2% with Change Healthcare.

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