MHI 525: Chapter 7

Chapter 7 Notes

health information systems

complexes or systems of processing data, information and knowledge in healthcare environments

List examples of healthcare environments

hospitals

ambulatory settings

long-term care facilities

managed care organizations

What are the 2 categories applications within health information systems are typically categorized into?

clinical

administrative

List examples of administrative applications

financial

practice management

supply chain management (SCM)

human resource (HR)

business intelligence (BI)

Who primarily provides the applications required to process information in healthcare settings?

vendors

enterprise vendors

vendors that deploy a comprehensive suite of applications

Who provides specialized applications?

niche vendors

HIMSS

provides an online product and directory service in the form of a searchable database with an exhaustive list of healthcare IT companies, products, and services

help stakeholders asses their options and make informed decisions

Health Data Management

publish hard copy and online content

maintain a resource guide by subject category

help stakeholders asses their options and make informed decisions

Gartner & KLAS

trade and research companies that provide fee-based ratings services

help stakeholders asses their options and make informed decisions

HIMSS Analytics

a wholly owned not-for-profit subsidiary of HIMSS

offers services to providers and healthcare IT companies

provides hospitals and providers that participate in an annual study access to their database, EMR Adoption Model Score, benchmarking reports, and hospital profiles free of charge

available by subscription to healthcare IT companies

KLAS

monitors vendor performance based on feedback from healthcare providers and by conducting independent analyses of products and services

publishes an annual Best in KLAS Awards report for software, professional services, and medical equipment

reports should be used with caution as vendors cited represent the ranking of just one ratings services

financial information system (FIS)

a system that stores and records fiscal (financial) operations within an organization that are then used for reporting and decision making

ill-fitted FIS can be life or death for the fiscal viability of the organization

List examples of financial components healthcare organizations perform

a customer (patient) purchasing the product (receiving the service)

salespeople (healthcare personnel) providing the service or product

supplies needed for a procedure (material management)

monies received to be deposited in accounts (accounting)

payment made to healthcare personnel and support staff for services (payroll)

automated FIS

the first type of systems used in many healthcare facilities

their main purpose was basking bookkeeping and payroll

What was put in place to help with the billing function?

basic accounting systems

What must be done to get cash flow?

charges must be captured and collected from the patient or the patient’s third-party payment system

What were the first and easiest functions of FIS?

entering charges

creating claims to send to insurance companies and patients

payroll

List examples of basic financial systems required by healthcare organizations and other businesses

general ledger

payroll

patient accounting

claims processing

claims denial management

contracts management

fixed asset management

general ledger

consists of all financial transactions made by the healthcare organization (akin to a personal checking ledger where any check written or deposits made are recorded in the account)

Why do healthcare organizations maintain various subsidiary ledgers?

numerous financial areas need to be tracked

What do subsidiary ledgers track?

customer and vendor names

dates of transactions

types of transactions

balances remaining

List types of data that need to be track by FIS

assets

accounts payable

accounts receivable

assets

property items that can be converted into cash

classified as tangible and intangible

tangible assets

include current and fixed assets such as inventory or buildings and equipment

intangible assets

include nonphysical resources such as copyright or computer systems

accounts payable

the monies that are owed to vendors and suppliers for items purchased on credit (similar to using a personal credit card and then paying back the amount on a monthly basis)

occur in the form of invoices or statements

accounts receivable

opposite of accounts payable

monies that are owed to the institution (come in the for of patient-generated revenues)

payroll application/system

also referred to as a disbursement system

handles compensation payments to employees

List functions of advanced payroll systems

automatic payroll deposits

overtime pay

pay rates

payroll histories

generate W2 forms for income tax preparation

patient accounting application

tracks the accounting transactions related to patient services (all charges incurred during patient visits and adds them to the patient’s financial record)

includes inpatient fees if patient is hospitalized, healthcare provider and medication fees associated with the treatment and procedure costs (includes surgeries, radiology, etc)

List factors that FIS need to be able to differentiate balances based on

amount

payer

age of the account

claims processing & management systems

the submission of the insurance claim or bill to the third-party payer either manually or electronically and the follow-up on the payment from the payer

must be able to keep each of the payer types separate and know the requirements of how to bill the claims, who to bill for the balances, or if the balances need to be written off and not billed to anyone

must review the claim before submitting to ensure all necessary data fields are complete and accurate

“clean” claims

the key to getting payment quickly & the key to the fiscal health of institutions so they can meet the financial obligations in their disbursements and accounts payable functions

claims that contain all critical information such as patient demographics, charges, procedures performed, procedural and diagnostics coding, and other information required by the insurance company to remit prompt payment

claims denial management application

prevents denials imposed by the insurance carrier (issues alerts on requests by clinical personnel for a patient to stay an additional day if they request is likely to be denied by the insurer)

must track the update and the progress on having a denial reversed in case of denial for improper coding or missing information

contract management application

tracks and manages contracts that affect the organizational bottom line in order to ensure the organization obtains maximum financial gain

must be able to track contracts and manage the terms and results of each contract individually

supply chain management (SCM)

includes the acquisition of materials of care and the logistics or movement of those materials to caregiving facilities and organizations

includes group purchasing (tracks vendor price comparisons and usage & ensures employees are adhering to the purchasing policies)

provides incentives for healthcare providers to reduce the cost of their preferred supplies

group purchasing

healthcare systems negotiate a price for using a standard vendor

fixed-asset management application

managed the fixed assets in a healthcare facilities that cannot be converted to cash easily, sold, or used for the care of a patient (land, buildings, equipment, fixtures, fittings, office equipment, computers, software, etc)

must track each fixed asset by location, person, age, etc

tracks depreciation, maintenance agreements, warranties related to the assets, and when the assets will need to be replaced

What is one of the primary functions of a FIS?

providing reports that demonstrate the financial condition of the organization

income statement/statement of operations

good representation of the bottom line

balance sheet data

based on a fundamental accounting equation (Assets = Liabilities + Owner’s equity)

each side must “balance” to show the financial condition of the organization

cash flow statement

show whether the organization will be successful in paying its bills (have more money than it owes)

List examples of categories ratios are classified into

solvency

debt

management or turnover

profitability

market value

length of stay

bed occupancy

Why are accounts receivable days in healthcare organizations generally higher than in other organizations?

services are provided before payment is made by patients or insurance companies

What is one of the challenges large healthcare organizations face with FIS implementation?

ensuring that the various systems in place at all locations are integrated

List 2 key problems with fee-for-service

it encourages providers to increase the amount of services performed

it doesn’t consider the quality of services provided

managed care

introduced to reduce excessive and unnecessary care

pays providers a lump sum per patient to cover a given set of services

no advantage for increasing the amount of services provided & poor quality increases the institution’s cost with no financial gain

What concerns did managed care present

compromised quality and constraints on patients having access to providers of their choice because payers restricted services in order to control costs

Patient Protection & Affordable Care Act (PPACA)/ObamaCare

a U.S. law aimed at reforming both the healthcare delivery system and the health insurance industry

includes a number of provisions designed to encourage improvements in patient outcomes as a basis for payment

pay for performance (P4P)

ties payment to the quality of the care provided or to patient outcomes as opposed to the service delivered

intended to provide financial incentives for physicians and healthcare organizations to have accountability over controlling costs while gaining more efficiency and higher quality in their operations

List examples of P4P programs

value-based purchasing

physician quality reporting

Medicare Advantage plan bonuses

What are some challenges for participants of P4P programs?

determining the quality “perceived” by patients because this can vary tremendously because of opinions and expectations

complying with structural suggestions can be costly so participants would need to know how much they are receiving in incentives to determine if the costs of the structural changes result in an overall positive gain financially

accountable care organizations

a network of doctors and hospitals that share responsibility for providing care to a specific group of patients and in return receives bonuses when these providers keep costs down and meet specific quality benchmark

social determinants of health

factors such as age, gender, geographical location, socioeconomic position, nutritional habits, drug uses or abuses, and work environment that may cause health issues in certain populations

List benefits of integrating FISs with CISs

eliminates duplication of effort

reduces the number of potential errors

provides transition between front-end and back-end operations

information required can be gathered and verified at the point of service or admission so that it’s immediately available for patient care and financial personnel

eliminates charge entry as eligibility checking for insurance can be done online and automated charging is supported

integrated “bolt-ons”

advanced revenue cycle IT or new generation

designed to improve billing by reducing billing errors, improving the timeliness of billing to cash collected, decreasing the cost of collections, providing real time eligibility for services, and providing improvement to current operational efficiencies via other functions

bolt-on

a product or system similar to an add-on but can be attached securely to an existing system

workflow rules engines

help to manage workflow

advanced executive scorecards

strategic management tools that aggregate data from electronic health records (EHRs) in concert with an FIS, thereby providing a snapshot of how the healthcare institution is performing in certain areas

single-database clinical & revenue cycle system

used to ensure accuracy, availability, and data integrity for patient care and billing for healthcare organizations

changes made to information contained within the database are managed throughout the system

What remains a constant goal of since the onset of FIS?

improvement in cash flow

efficiency tools

must provide a snapshot of the data so the decision makers can immediately analyze financial events within a particular area

needs to be able to assist end users with the questions that need to be asked, and when

information needed should be readily available and easy to access

needs to be a seamless flow of charges as a natural by-product of the care process to help reduce lost, late, or duplicate charge

applications must allow for coding edits or over-riding default values as needed, that are easy to use, and that include executive dashboards capabilities

dashboard

provides users with a visual analysis of specific data points so an organization can gauge how it is performing in certain areas

called a dashboard because it resembles the visual data points provided on an automobile dashboard

practice management systems

very similar to the information systems supporting integrated healthcare systems, only on a smaller scale

focus on the services provided in a healthcare provider’s office compared with the services provided in a large healthcare system or hospital

designed to collect patient demographic and insurance information, manage appointment scheduling, document the reason for the visit and patient care procedures performed for the patient, post charging information for the billing process, and manage collection and follow-up

requires integration

What are the primary differences between PMSs and information systems supporting hospitals?

specific provider scheduling templates and types of visits

transaction or line-item provider billing compared with account-driven hospital billing

provider-based medical record content (orders, referrals, provider documentation, and problem lists) that differs from the typical comprehensive hospital medical record

patient outreach systems

electronic registries of entire patient populations used in providing preventive care to managed patients with chronic illnesses

should incorporate evidence-based, specialty-specific protocols—or recommended care guide- lines—for chronic and preventive care

online billing & payment tool

helps improve the management and collection of fees owed by patients

helps healthcare facilities realize increased patient satisfaction and improved staff efficiencies

List the 2 ways professionals define supply chain

starting with unprocessed raw materials and ending with the final customer using the finished goods, the supply chain links many companies together

the material and informational interchanges in the logistical process stretching from acquisition of raw materials to delivery of finished products to the end user

vendors, service providers, and customers are links in the supply chain

materials management

a subset of the larger function of SCM

the storage, inventory control, quality control, and operational management of supplies, pharmaceuticals, equipment, and other items used in the delivery of patient care or the management of the patient care system

purchasing department

a key department within materials management

traditionally controls or participates in budgeting, replenishing inventory, negotiating, evaluating and selecting capital, maintaining vendor relationships, etc

enterprise resource planning (ERP)

indicated by HIMSS as a tools for quality and safety because they integrate capabilities such as procure-to-pay, order-to-cash, and financial reporting cycles

contain functions that help institutions match needed materials with care in a more timely and cost-effective manner

supply item master file

a list of all items used in the delivery of care for a healthcare organization that can be requested by healthcare service providers and managers

charge description master file

a list of all prices for services (e.g., Diagnosis-Related Groups [DRGs], HCPCS, and CPT) or goods provided to patients that serves as the basis for billing

vendor master file

a list of all manufacturers or distributors (vendors) that provide the materials needed for the healthcare organization along with the associated contract terms and prices for specific items

transaction history file

a running log of all material transactions of the healthcare organization

a running list of all supplies and materials being used to deliver care or manage the operations of the institution

point-of-use technology/capturing charges when supplies or materials are used

allows healthcare institutions to increase productivity, increase accountability, and reduce downtime through improvements in their internal supply chain

if integrated with a solid business process, can enhance efficiency and effectiveness of the healthcare supply chain

List strategic factors associated with supply success and enhancement

information system usefulness, electronic purchasing, and integration

leadership supply chain expertise

supply chain expenditures

provider level of collaboration

nurse and clinical staff level of collaboration

leadership team’s political and social capital

capital funds availability

human resource information systems (HRISs)

leverage the power of IT to manage human resources

integrate “software, hardware, support functions and system policies and procedures into an automated process designed to sup- port the strategic and operational activities of the human resources department and managers throughout the organization”

include the following subsystems defined by function: recruitment and selection from among candidates; administration of personnel processes; time, labor, and knowledge management; training and career development; administration of compensation and benefits for active workers and pensions for retirees; payroll interface; performance evaluation; transitioning and outplacement; labor relations; organization management; and health and safety

operational HRISs

collect and report data about employees and the personnel infrastructure to support routine and repetitive decision making while meeting the requirements of government regulations

strategic HRISs

support activities with a longer horizon such as work- force planning and labor negotiations

tactical HRISs

support the design of the personnel infrastructure and decisions about the recruitment, training, and compensation of persons filling jobs in the organization

human resource management

should focus on employee training, as well as developing and refining the work systems to improve the work climate and the quality of service to customers

List 3 reasons why many healthcare organizations do not employ optimal human resource practices

the responsibilities and activities of human resources personnel are institutionalized and under-valued in many healthcare organizations

the provider culture of healthcare focuses on the clinical delivery of care with less attention paid to the effective management of resources

lack of expertise and low skills in the human resource function have limited the ability of human resource managers to engage effectively in strategic and operational planning

List 5 dimensions of human resources capability

a competent human resources executive in the C-suite

a skilled human resources staff

an organizational culture that elevates human resources to a central function

commitment to continuous learning

an integrated, computerized HRIS

personnel administration

maintained and updated with information such as employee identification and demographics, dates of service, position and job code, location code, and employment status (permanent or temporary, full time, or part time)

maintain records of licensure, credentials, certifications, and skill proficiency levels

self-service capabilities allow employees to maintain a personal profile with the ability to access and modify personal information such as name, address, contact information, marital status, and information about dependent family members

staffing

involves the assignment of personnel to job positions while ensuring that they are qualified by virtue of degree, licensure, certification, training, and experience

scheduling

involves the assignment of qualified personnel to a scheduling template within a work area in the organization to fulfill the mission of that organization

staffing & scheduling

replaces the subsystem “time, labor, and knowledge management” as a more accurate representation of the activities supported by the HRIS subsystem

List key requirements of staffing and scheduling

cost-effective staffing while meeting constraints imposed by required qualifications

scheduling visibility

matching the level and number of caregivers to patient classification and acuity levels as mandated by law or regulation

leave management/absence management

a rules-based application designed to manage absence requests while interfacing with workload scheduling

open shift management

a web-based self-scheduling solution in which the nurse manager broad-casts openings in the schedule to qualified staff via a number of instant communication tools

members respond by tendering schedule and shift requests for consideration and approval

incentive management

involves the use of monetary and point-based rewards for staff who volunteer to fill openings in the schedule

predictve scheduling

uses predictive modeling to forecast bed demand while accounting for variables such as bed turnover, changes in patient acuity, work- load distribution, and variability caused by shift, day of the week, month, and seasonality

training and development

must use IT solutions as the infrastructure to plan and manage employee training, to serve as the delivery mechanism synchronously and online, and to link training with the developmental plan for each employee by identifying shortfalls in skills and competencies and then recording when those shortfalls have been remediated

Oracle PeopleSoft

permits managers to view and update employees records online; receive alerts and decision support when changes in salary and benefits are being considered; receive reports on individuals, as well as groups of employees; and permit employees to view and maintain their own records as appropriate

performance evaluation

also referred to as talent management/performance management

focuses on recruiting and training employees and developing competencies required to fulfill institutional goals and objectives

individual career goals are also considered

business intelligence software

provide tools to effectively manage and use massive amounts of data

purported to lead to an improvement in financial (particularly revenue cycle) and operational performance, as well as patient care

the “acquisition, correlation, and transformation of data into insightful and actionable information through analytics, enabling an organization and its business partners to make better, timelier decisions”

must be placed in the hands of the people who actually do the work, training must be done initially and throughout the project so that users will have time to use the basic functions and expand their knowledge, questions that arise throughout the analysis must be reviewed and answered, and the BI should be used for long-term planning

application-level BI software

may be employed strategically to address “key processes, functions, or service lines” given the cost, time, and complexity of large-scale BI implementation

provides some of the data integration and visualization of enterprise packages, analyzes existing data that may be overlooked in traditional reporting, and creates actionable knowledge

List lessons from Unraveling the IT Productivity Paradox—Lessons for Healthcare

authors suggest, “assessment of the value of health- care outputs could be improved through the more sophisticated use of clinical data to understand access, convenience, and health outcomes”

new information technology often requires redesign of the processes that were previously tailored to the technology or manual system just replaced

new information technology compromises productivity when it fails to be user centered

healthcare organizations can no longer afford to have an abundance of untapped data that fails to improve decision making. Improvements in healthcare information systems, BI, and analytics must continue to improve the quality of decision making