Managing the Chargemaster: The Fuel of the Revenue Engine
Your chargemaster is the fuel that runs your revenue cycle engine, serving as the basis for your reimbursement and financial success. Hospital leadership responsible for achieving financial goals that include revenue growth, expense management, and operating margins are facing the growing importance of chargemaster integrity. We attribute the challenge of managing these financial goals to the accuracy of charge data and the task of ensuring effective processes are in place for compliance with appropriate cost standards and principles that will require more from leadership than before.
Hospitals must manage the chargemaster to meet these requirements by identifying performance improvement opportunities through analysis of trends illustrated by data, workgroup teams focused on effectiveness of cost management, and industry best practices.
The role of chargemaster management far exceeds the use of software itself. The role encompasses everything impacting the revenue stream, from correcting coding and billing errors to managing the inflow of monthly and annual regulatory changes (CMS for example) and forecasting the long-term chargemaster budget.
The Chargemaster Environment
The chargemaster environment grows increasingly complex. Minimizing the potential for errors means understanding complicated health information system (HIS) data relationships, being able to identify inaccuracies in coding, and comprehending the impact of regulatory changes. Organizational changes such as acquisitions, software and system conversions, and change in payment models increase the potential for errors.
In today’s multifaceted healthcare industry, hospitals are recognizing the need to proactively plan for future chargemaster management. They are also recognizing the necessity of having a set of best practices to optimize their revenue streams. Hospitals may have limited processes to manage charge data and pricing, limited internal processes to audit their own chargemaster, and sub-optimal means to communicate payment, coding, and regulatory changes to departments. Many organizations find they are unequipped for long-term chargemaster management.
Capturing Appropriate Services
A compliant, well-managed chargemaster means that the master file for all services, procedures, drugs, and supplies is routinely updated and the revenue cycle operates seamlessly. Where a chargemaster is fully managed and maintained, accurate charge capture leads to continual revenue optimization—a revenue management best practice. A compliant chargemaster ensures appropriate charges and converts them to revenue. Those who manage the chargemaster process should:
- Confirm that charges are reasonable and defensible,
- Ensure coding translates to accurate billed and paid services, and
- Reduce or eliminate inappropriate charges.
Hospitals should frequently assess components of the chargemaster and identify performance opportunities within systems and within associated processes.
Managing Risks to Revenue Cycle
Comprehensive chargemaster management brings other important benefits, including managing risks to the revenue cycle. As coding and billing rules become increasingly complex, healthcare organizations today are finding the use of chargemaster software beneficial for:
Summary
The chargemaster is no longer just one file; it has emerged as a complex central revenue engine for the organization. Achieving financial goals of the organization relies heavily on chargemaster management. The complexity of data has grown along with changes in healthcare systems and revenue management. With mergers, acquisitions, and the ever-changing regulatory environment, you need software and ongoing expertise to ensure optimal coding accuracy, compliance, and revenue.
Panacea’s consulting team and customers utilize ChargeAssist®, the industry’s best all-in-one chargemaster management tool. The software allows streamlined and robust chargemaster collaboration, data monitoring, and process improvement, immediately resulting in improved revenue integrity and compliance. ChargeAssist is rapidly replacing competing chargemaster products across the country, and seamlessly accommodates EPIC, Cerner, and other HIS platforms.
To learn more about the features and benefits of ChargeAssist, click here.
