Answered: The director of revenue integrity at…

Purchasing and Supply Chain Management

6th Edition

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

ChapterC: Cases

Section: Chapter Questions

Problem 5.2SC: Scenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing...

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Question

The director of revenue integrity at Marceline University Health System has examined several benchmarks for denial key performance indicators (KPIs). The director discovers the organization deviates significantly from the overall initial denials rate, which has recently reached 9% of Health System's gross revenue. The identified best practice KPI for initial denials is < 4% of gross revenues.

a) Why is it important for the organization to achieve that particular KPI metric?

b) What areas of the revenue cycle are affected by deviation from the metric, and what are the impacts on those areas?

c) What steps would you take to improve processes and achieve the KPI metric?

d) Identify the areas that would need representation to work on the process improvement plan

e) Once the improvement efforts resulted in achieving the metric, how would you ensure sustained results?

Expert Solution

Introduction:

"The solution has been provided in a generalized manner".

Revenue cycle management is critical to the financial health of any healthcare organization, and denials management is a key component of this process.
Recently, the director of revenue integrity at Marceline University Health System conducted an examination of several benchmarks for denial key performance indicators (KPIs).
The director discovered that the organization is deviating significantly from the overall initial denials rate, which has recently reached 9% of Health System's gross revenue.
This has led to significant financial losses and highlights the need for improvement in the revenue cycle management processes.
The identified best practice KPI for initial denials is less than 4% of gross revenues, and achieving this metric is critical for the long-term financial sustainability of the organization.
In this context, this essay will discuss the importance of achieving this KPI, the areas of the revenue cycle affected by deviations from the metric, steps to improve processes and achieve the KPI metric, areas that need representation to work on the process improvement plan, and how to ensure sustained results once the improvement efforts have resulted in achieving the metric.