Dive Brief:
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Cook County Health and Hospitals System lost at least $165 million in revenue over three years because of “lax clerical procedures and employee errors,” the Chicago Tribune reported.
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Cook County Inspector General Patrick Blanchard blamed the Chicago-based health system’s “bureaucracy,” which led to mistakes and billing lapses. Employees said the hospital did not provide enough training and that clerks contributed to errors by skipping steps in the patient scheduling software.
- Cook County Health and Hospitals System CEO John Jay Shannon said one issue was health insurance billing complexities following the Affordable Care Act. The system served many uninsured people and Medicaid paid on a fee-for-service basis before the ACA. However, more insured people changed that dynamic and forced the system to create new processes and infrastructure to handle insurer payments, he said.
Dive Insight:
Cook County, of course, isn't the first hospital or health system that’s lost money because of poor processes and clerical errors.
This is an important issue that I've been raising for some time. We should treat everyone, but if you're insured, County should be reimbursed. https://t.co/gAqlUxk5Fo
— Richard Boykin (@RichardRBoykin, a Cook County Commissioner representing West side of Chicago) May 15, 2018
In many cases, hospitals are faced with the changing dynamic of patients increasingly becoming payers with more out-of-pocket costs. Patient dollars now make up one-third of healthcare payments. This has forced hospitals and health systems to shift focus in the revenue cycle from largely getting fee-for-service payments from Medicaid to working more with private payers.
What makes the Cook County case different is that one reported cause of the problems (more privately insured people) is usually seen as a positive for hospitals. Private payers typically pay more than Medicaid and reimburse more promptly. However, in this case, the health system said the change forced it to change processes, which has taken time.
Health officials have lamented the loss of ACA coverage gains over the past year, as the Trump administration and Republicans have kept up attacks on the law.
The Commonwealth Fund's ACA Tracking Survey recently said the rate of uninsured people between the ages of 19 and 64 increased from 12.7% in 2016 to now 15.5%. That’s about 4 million newly uninsured people.
The fear is that new policies implemented and proposed in Washington will lead to more uninsured Americans and with it, more uncompensated care for hospitals.
Earlier this year, the American Hospital Association said uncompensated care increased in community hospitals in 2016, which is the first year since 2013 the amount went up from the previous year. The report said 4,840 community hospitals provided a total of $38.3 billion in uncompensated care in 2016, up from $35.7 billion at 4,862 community hospitals in 2015.
However, in the case of Cook County, having more insured people meant needing to create new processes to deal with private payers rather than getting payment elsewhere, such as Medicaid. Shannon said the system continues to modernize its revenue cycle infrastructure in response to having more patients with private insurance.