The Barnwell County Hospital was given a financial healthcare plan to follow during its monthly meeting Jan. 28.

Eric Shell of Stroudwater Associates - a healthcare consultation firm - presented board members with a list of proactive strategies the hospital can use to improve its finances.

"I see this as being really important because it gives us an actual strategy to turn our finances around," said hospital CEO Mary Valliant.

Board chairman Don Alexander said Shell told the board the hospital is doing good things operationally.

But some of the major financial problems lie with the revenue cycle and bill-collecting practices as well as the performance of the business office.

According to the report, revenue shortfalls have led the hospital to delay paying some of its bills.

Shell referred to the hospital's billing process as being ineffective and "blown up," said Alexander.

"A lot of it has to do with the business office," said Alexander.

Shell told the board the number of days it takes for the hospital to collect revenue is below other hospitals.

The hospital needs to speed up its billing process and get it down to two days and the process currently takes 8 to 10 days, said Valliant.

The process is complex, but it starts with admitting the patient; verifying accurate insurance information; and then patient medical records are coded based on physician documentation. The code determines the billing.

Sometimes glitches arise in getting accurate insurance information from the patient - whether its private insurance, Medicare or Medicaid - and the information is rejected by the payer.

Another suggestion is to update the chargemaster which is the master billing program for the hospital.

"There are experts who do nothing but update chargemaster," said Valliant.

Chargemaster bills patient procedures based on a complex mathematical formula.

It contains the prices of all services, goods and procedures for which a separate charge exists.

If changes are not made soon, Alexander said, the business office could be outsourced.

The following is a list of other highlights from Shell's presentation.

• The hospital needs to gain critical access status which will give it higher Medicare and Medicaid reimbursement rates.

A hospital is designated critical access if it provides certain services and it falls within a specific geographic area determined by mileage and secondary roads, said board member Steve Sloan.

Currently, the hospital's status is a sole source provider, said Valliant.

Critical access status has to be approved by the state and the Center for Medicaid and Medicare, said Valliant.

The hospital qualifies for critical access status and it will begin the process but it will take a minimum of 10 months to get it, said Valliant.

The hospital stands to make a potential $884,000 a year in extra revenue if it can get critical access status, said Alexander.

The hospital lost nearly $1 million in operating losses in fiscal year 2009, the report said.

• BCH needs to get a loan for operating cash of between $1 million to $1.5 million.

At press time, the third and final reading of an ordinance to provide for a hospital revenue bond not to exceed $1.6 million was going before Barnwell County Council Feb. 2.

If approved, the hospital will seek a 80 percent backed USDA loan, said Valliant.

•The hospital should increase its rate of visiting specialty physicians such as orthopedists.

Currently, the hospital has visiting specialists such as a neurologist (sleep doctor) and a cardiologist.

It will get a gynecologist starting next week, said Valliant.

Visiting specialists will bring more profits to the hospital as well as secure its critical access status, said Sloan.

• Renegotiate rural health clinic insurance rates with Blue Cross and Blue Shield so reimbursement rates can improve.
The rates haven't been renegotiated in four years, said Valliant.

• Raise the number of in-patients the hospital admits.

In-patients get a higher reimbursement than outpatients.

• Renew swing bed policy and grow physical therapy services.

Swing beds are rehabilitation beds which are supported by specific specialities such as orthopedists, physical therapists and occupational therapists.

Currently, the hospital only has acute beds.

The physical therapy services the hospital provides won't conflict with the Barnwell County Nursing and Rehabilitation Center, said Alexander.

That is because the hospital would take short-term care cases - 10-days or less - and the nursing home takes long-term care cases, said Valliant.

The hospital could expect to serve an average daily census of four patients within three to six months of enacting the swing bed policy, from the report.

• Coordinate with local physicians to send their patients to the hospital.

• Improve cosmetics of the hospital.

Currently, individual rooms in the hospital are being painted and plans are underway to paint the outside of the facility and pave the parking lot in the spring, said Valliant.

"These recommendations will bring Barnwell County Hospital into 2010 instead of 2000," said Sloan.