Case Study

Safety-net Hospital Yields Millions in Collections from Legacy System Clean-up

Share via LinkedIn Share via Twitter Share via Facebook Share via Email

Safety-net Hospital Yields Millions in Collections from Legacy System Clean-up

After turning to Parallon for help converting its revenue cycle platform, a 567-bed academic medical center—the largest safety-net hospital and the largest Level I trauma center in its region—has been able to collect $15.8 million from a recent legacy system clean-up.

CLIENT

567-bed academic medical center

FACILITY TYPE

Region’s largest safety-net hospital

Region’s largest Level I Trauma Center

THE OPPORTUNITY

The hospital determined it needed help cleaning up its legacy A/R and collecting on specific accounts so its billing department could focus on training and preparing to work in a new revenue cycle platform.

It ended up placing $91.9 million in legacy A/R, which was made up of 45% commercial accounts and 55% government-pay patient accounts (Medicaid and Medicare).

The average age of the accounts at the time of placement was 97 days, and the average balance at the time of placement was $950.

HOW WE HELPED

Once the health system evaluated the risks associated with going it alone and having staff implement a swivel-chair strategy—winding down the legacy A/R system while simultaneously training and working in the new system—outsourcing seemed the wisest option. The hospital leadership selected Parallon based on its track record in legacy A/R clean-ups and its familiarity with a variety of revenue cycle platforms.

First, the hospital needed help cleaning up and reconciling accounts. Parallon resolved accounts for the hospital that, per the terms of the contract, it was not collecting.

After identifying self-pay accounts, accounts that needed to be reclassified as they were not in scope and adjustments, there was a net placement total of $15.9 million.

THE RESULTS

Since January 2018, Parallon has been able to collect $15.8 million of the $15.9 million collectible net amount.

Parallon was able to map out an efficient process as well, collecting 83% of the net placements in under 90 days.

LESSONS LEARNED

With A/R often being the most valuable current asset on the balance sheet, health systems are wise to carefully handle legacy A/R wind-downs when converting their revenue cycle platforms. Best practices mean outsourcing legacy A/R to an experienced vendor.