7 Tips for Managing Financial Health During the Pandemic
From increased expenses to significant revenue loss, the COVID-19 pandemic is putting substantial financial pressure on hospitals and health systems across the U.S. To minimize the economic damage providers must take a proactive and aligned approach to manage costs and optimize revenue.
Here are 7 tips that can help improve your hospital's financial performance as you execute your emergency plan in this national battle.
Keep in Constant Contact with Payers
Ensure you’re keeping in constant communication with Federal, State, Local and critical Commercial payers:
Ask questions to accurately bill and get reimbursed for COVID-19 treatment
Discuss how the COVID-19 impact will factor into regular FFS and Value-Based Care agreements
Utilize the Stimulus Bill
Get your share of the...
1. $100 billion in emergency funds approved to compensate hospitals and other health care providers for lost revenue and additional costs associated with COVID-19 (exact distribution still in development)
2. $16 billion to replenish the nation’s depleted stockpile of medical gear, such as ventilators, medicines and personal protective equipment (PPE)
3. $8 billion for more than 3,000 DSH providers that will reverse cuts in their Medicaid payments for 2020 and 2021
Take advantage of...
1. The temporary suspension of a 2% Medicare sequestration reduction
2. A 20% increase in Medicare payments for treating patients with the virus
Track all Expenses and Lost Revenue
COVID-19 relief funding for hospitals will be coming through several government sources - all with different requirements. Start tracking now! Hospitals could be eligible for funds through:
Federal Emergency Management Agency
Several funding streams set up by Congress in the Coronavirus Aid, Relief, and Economic Security Act
Adjust Cost Accounting to Track COVID-19 Expenses
It is essential to track all the new / increased expenses associated with COVID-19. Create a new GL code to:
Track all labor costs (OT, new hires, temp workers, training, HR)
Track all supply costs (Medical equipment, PPEs, etc.)
Track any applicable capital investments (Construction costs, specialized equipment dedicated to COVID-19 wings, etc.)
Be sure to include any policies that lead to the cancellation or delay of elective procedures
If an organization has more sophistication in defining its costs and lost revenue, they will have a better answer if and when the government calls years from now. Take tracking seriously.
Help Patients with Medicaid and Charity Care Eligibility
As the pandemic expands, needs for health insurance coverage through Medicaid and CHIP will increase for people who get sick and lose private coverage due to the declining economy
Facilitating enrollment for the growing numbers of individuals who will become eligible for Medicaid will be critical
States can adopt a range of options under current rules, including waivers, to increase Medicaid eligibility, facilitate enrollment and continuity of coverage, and eliminate out-of-pocket costs
Additionally, there will be a special enrollment period for State exchanges, AND the Trump administration is considering using some of the $100 billion relief to pay for COVID-19 treatment
CMS added 85 more Medicare services covered under telehealth
Clinicians can bill immediately for dates of service starting March 6, 2020
Services are paid under the Physician Fee Schedule at the same amount as in-person services
Medicare coinsurance and deductible still apply for these services
HHS Office of Inspector General (OIG) is providing flexibility for healthcare providers to reduce or waive cost-sharing for telehealth visits paid by federal healthcare programs
Work with Commercial payers to expand telehealth for those populations as well
Optimize Revenue Cash Flow
Critical to update revenue and expense forecasts
Set aggressive expense reductions targets
Layoffs, furloughs, and canceled cases will require a reduction in daily spend and expenses
Conduct OP staff vs. IP staff re-balancing
Nail your Billing / Coding for COVID cases
Understand Patient Responsibility
Properly allocate resources
Get Alignment between Revenue Cycle, Managed Care, and Payer Resources
About the author: Michael Hickey is a LifeWings Senior Advisor and Strategic coach with over 15 years’ experience and extensive background specializing in strategy, operations and analytics. His work as both a consultant and within health systems across the continuum has provided him with the ability to stimulate and guide the client’s thinking when addressing the challenges organizations are faced with in today’s transforming healthcare environment. He has successfully assisted a variety of organizations to transition from traditional fee-for-service operations to the new valuebased model of care delivery. Michael has led successful Clinical Integration, Care Delivery, Payer Negotiations and Revenue Cycle projects over his career resulting in direct improvements to the cost and quality of care delivery and measurable revenue optimization.
Michael, along with all of the LifeWings team, is deeply grateful for the heroic work you are doing on the frontlines. Together, we will prevail.