A look into KPIs: Hospital late charges

Wednesday, January 10, 2018

At Grady Health System in Atlanta, monitoring key performance indicators (KPI) always comes back to the foundation KPI: hospital late charges. The timing of posting charges has a ripple effect. The longer you wait to post a charge, the more likely it is you will miss something.

“Timely charge capture is so important because it dictates your reimbursement and the true revenue you get back as a healthcare system,” says Bruce Preston, CPC, director of revenue integrity at Grady Health System. “This specifically relates to timely filing denials, as well as our state Medicaid late charge policy.”

Hospital late charges are measured by “min days,” the minimum amount of time from when a patient is discharged to when the bill is dropped and a claim is sent to the insurance company. While some facilities operate on a min day timeframe of discharge plus three days, others’ min day may be as long as five days. However, if charges aren’t posted within 24 hours, the claim runs the risk of being generated without the charge.

“That causes extra work on the billing department, who now have to go back and submit a corrected or updated claim because of that late charge that was put on after the bill was already dropped,” says Preston. “It can affect reimbursement and/or cause rework on your billing staff.” He advises physicians and nursing staff to get charges in within 24 hours of seeing their patients.

At Grady, late charges are measured as a percentage of total charges posted. More specifically, the facility compares how it stacks up in terms of the amount of charges posted on time versus those posted late.

By looking at data from other academic medical centers, trauma hospitals, and safety net hospitals, as found in EPIC’s Financial Pulse module, Preston and his team can see how they rank against other facilities. The revenue integrity department creates a weekly report of these rankings and sends it out across the facility so other departments can see how Grady is doing compared to its peers.

For example, if a clinic has 50% of charges posted late last week, then it may be ranked No. 1 for the highest percentage of late charges for that particular week, says Preston. If a department has a high percentage of late charges, the revenue integrity department will seek to determine the root cause by reaching out to the department to ask what caused the delay in charge capture. The root cause could range from a system-related issue to understaffing a department.

To read more about KPIs, check out the January 2018 issue of the NAHRI Journal, where revenue cycle professionals share six steps to successfully establish, track, and maintain KPIs.