A recent KIWI-TEK brief shed light on how frequently EHRs cause reimbursement backlogs and the magnitude at which they do so. This blog post expands upon that theme, offering three real-life examples of EHRs causing errors in hospital billing departments through increased claims rejections and denials.
Designed to lower administrative costs for healthcare providers, EHR systems are a familiar challenge for many in the HIM profession. Reports claim that hospitals experience an estimated 20% decrease in coding activity and 21,000 bills requiring manual intervention per month after an EHR implementation.
Furthermore, EHR implementations frequently cause skyrocketing DNFB levels, with hospitals reporting discrepancies in DNFB numbers between EHR and billing systems as large as $7.3 million. Many organizations find that these effects do not subside after the implementation process ends. EHR upgrades and conversions create similar negative impacts on coding, billing and accounts receivable.
Below are 3 examples of recent billing, coding and claims issues following major EHR change. These examples are also cited in the KIWI-TEK brief.
- 1) EHR to Cost Texas Health System $55 Million
In spite of an 18-month training period, one Texas health system reported persistent post-EHR billing and coding issues. This news came in November of 2017, three months after the implementation was completed. The losses that the organization incurred were so great that its board moved to hire an accounting firm to overhaul its revenue cycle process and decrease it’s DNFB balance. A technology consulting firm was also brought onboard to analyze the issue. Results concluded that DNFB had been inflated by the EHR.
For example, one day’s reporting from the EHR showed $14 million in DNFB, while a report from a separate billing system showed only $6.7 million in DNFB.
- 2) EHR contributes to $44.2 Million in Operating Losses
Last year, a prominent Boston cancer center cited it’s EHR system as a contributing factor to a significant decrease in revenue. In it’s third fiscal quarter the cancer center reported operating losses of $44.2 million, a stark contrast to the $6 million it reported one year prior. Spokespersons claimed that the hospital had experienced persistent billing issues with the EHR, contributing to an annual loss in net patient service revenue of $2.4 million and estimated total losses of $25 million over its then three years of use.
- 3) EHR Vendor Sued Over Faulty Software
After incurring over $16 million in losses, one Wisconsin health system took the matter to court. In September of 2017, the healthcare provider filed suit against their EHR vendor on the grounds of fraud and breach of contract. The hospital stated the software began to cause errors in billing immediately after its implementation.
Billing issues became so severe the hospital ultimately had to begin issuing payment statements by hand, leading to a large backlog of unprocessed statements. Though the EHR vendor declared the issue resolved in 2016, the health system continued experiencing issues with coding well into 2017. The hospital is seeking direct and indirect damages, punitive damages, and a cancellation of the EHR vendor’s contract.
Prevent Billing Backlogs Following EHR Change
The best way to mitigate reimbursement issues following EHR implementations, upgrades or conversions is through extensive planning, detailed communications and backup staffing support. Proactive measures must be taken to mitigate claims rejections, denials and backlogs. Through careful monitoring and the use of back-up coding and billing support, organizations can maintain a more positive cash flow before, during and after their EHR changes.
KIWI-TEK partners with hospitals across the country to provide consultative and staffing support in association with EHR implementations and beyond. Contact us today to learn more about maximizing your organizations coding and billing performance
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