Healthcare information systems help benefit Illinois Valley Community Hospital

CASE ST
ILLINOIS V UDY
ALLEY COMMUNITY HOSPITAL
P E R U , I L • R E V E N U E C Y C L E S O L U T I O N S
ILLINOIS VALLEY COMMUNITY HOSPITAL FUNDS FACILITY RENOVATION,
CLINICAL IT THROUGH RENEWED FOCUS ON REVENUE RECOVERY
AT A G L A N C E
Profile
Eager to use human resources for
value-added activities and improve the
Illinois Valley Community Hospital is a
hospital’s bottom line, Illinois Valley
ORGANIZATION
100-bed not-for-profit, general acute-care
turned to McKesson for help.
Illinois Valley Community Hospital
facility with a 20-bed inpatient psychiatric
unit. The hospital serves the residents of
Answer
Peru, Ill.
the Peru-LaSalle-Oglesby-Spring Valley
– 100-bed not-for-profit, general
areas in north central Illinois. In fiscal
Working with McKesson, the
year 2004 the hospital admitted 4,566
organization implemented a
acute-care facility
patients and managed 100,072 outpatient
technologically advanced revenue cycle
– 20-bed inpatient psychiatric unit
and 16,924 emergency room patient visits.
system, including these McKesson
solutions: EC2000™ Claims
SOLUTION SPOTLIGHT
Challenge
Administrator, Pathways Compliance
– Paragon
Advisor™, Accelerated Secondary
With outdated billing and accounts
Billing, Transaction Solutions Hub™
– EC2000 Claims Administrator
receivable (A/R) processes, it was
for statement processing and electronic
– Accelerated Secondary Billing
no surprise that Illinois Valley lagged
claims, and the Paragon™ hospital
behind other hospitals financially, with
information system, including Paragon
– Pathways Compliance Advisor
an average of 75 days’ A/R.
Patient Management and Paragon
– Transaction Solutions Hub
Receivables Administrator.
Ineffective patient registration and claim
CRITICAL ISSUES
follow-up processes slowed the claims
The McKesson solutions allowed Illinois
– Average of 75 days in accounts
submission and dispute resolution. Most
Valley’s business office to operate with
processes were paper-based, and staff
receivable (A/R)
more streamlined processes in a virtually
audited every claim manually. Just filing
paperless environment. Bobbi Stumbo,
– Inefficient, paper-based,
paper kept staff tied up in non-revenue
Business Office director and project
manual processes and
producing activities.
manager for the system implementation,
slow claim submissions
explains the difference: “We are not the
The hospital lacked the front-end systems
same department that we were before.
– Numerous billing errors and
to capture diagnosis codes at registration
With the Paragon system, everything
calls from unhappy patients
and to verify financial insurance, forcing
seems to just flow together — from the
these processes to the back office and
RESULTS
point of first contact with the patient,
causing errors and delays in claims
or physician, through central scheduling/
– Reduced A/R days to 51
submissions. The technology system
registration to final payment. We
and recovered $6.4 million
in place in the back office was outdated
now have systems in place that allow
in accounts receivable
and did not provide the functionality
information to seamlessly flow through
needed to meet the challenges of today’s
to billing.”
– Streamlined processes and
healthcare market. For example, editing
reduced claim submission
forms was vendor-dependent and required
Advanced technology and up-to-date
from three days to less than
long lead times, causing further back-ups
processes built into the system allowed
one day
in claims submissions.
Illinois Valley to submit cleaner claims
faster, respond quickly and easily to
– Raised patient satisfaction,
In addition, morale among finance office
electronic claim rejections, and even
reducing incoming patient calls
staff suffered from the constant barrage
bill secondary claims before Medicare
by 64%
of phone calls from patients angry at
payment is received. “With the EC2000
the errors on their statements and
Claims Administrator and Pathways
frustrated with the long payment and
Compliance Advisor systems, our billing
reimbursement cycles.
employees are no longer under pressure

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CASE STUDY
I L L I N O I S VA L L E Y C O M M U N I T Y H O S P I TA L • R E V E N U E C Y C L E S O L U T I O N S
to know every medical necessity rule,”
For example, in the past posting a large
Stumbo explains. “Claims go through so
Medicare remittance took two days. After
simply. Our billers love it.” Illinois Valley
implementing the electronic remittances
is also able to unlock and edit forms on its
functionality of the Paragon system,
own immediately to keep claims moving
posting takes just 30 minutes.
“With the Paragon system
out the door.
everything seems to just flow together,
The business office has left behind its
Initially, staff members were concerned
crisis management mode of operating
from the registration of the patient
about the change to the new tools and
and staff members are able to focus on
and our central scheduling department,
preferred the comfort of working with
working with insurers on claims and
known processes. However, Stumbo says
providing a higher level of customer
and through billing.”
as they began to work with the Paragon
service. Stumbo describes the impact on
solution, they became excited with the
morale: “Our office staff members feel
possibilities for improving tedious and
positive and empowered in their jobs.
time-consuming tasks. “When our staff
They feel that they know the system
Bobbi Stumbo
members realized they could now get a
extremely well. And, they feel like they’re
claim out on the same day, instead of three
really contributing to the hospital and
Business Office Director
days while they waited for information,
our bottom line.”
that’s when they really bought into the
system,” Stumbo says. She adds that the
Steve Davis, chief financial officer for the
staff constantly thinks of better ways
hospital, says McKesson’s revenue cycle
to use the system, such as by adjusting
and HIS systems have done such a good
forms and monitoring work with the
job at reducing paper and improving
receivables queue.
processes that the hospital has purchased
McKesson’s document imaging systems
Results
to further reduce paper in the business
office and create paperless patient
Implementing the McKesson solutions
records. With the technology that is
helped the organization reduce A/R by
already in place and more to come,
24 days – down to a healthy 51 days –
administrators at Illinois Valley are
and recover $6.4 million in accounts
ensuring that the hospital never lags
receivables. The recovered money funded
behind again.
a facility renovation, as well as the purchase
of several clinical systems (McKesson’s
pharmacy and PACS systems) to speed
the delivery of patient care.
The improvements in revenue cycle
performance are the result of streamlined,
nearly paperless processes that accelerate
the submission of clean claims. Other
processes also show marked improvements.
McKesson Provider Technologies
5995 Windward Parkway
Copyright © 2006 McKesson Corporation and/or one of its subsidiaries. All rights reserved. EC2000, Paragon,
Alpharetta, GA 30005
Pathways Compliance Advisor and Transaction Solutions Hub are trademarks of McKesson Information Solutions,
LLC. All other product or company names mentioned may be trademarks, service marks or registered trademarks
1.800.981.8601
of their respective companies.
http://mpt.mckesson.com
PRT239-02/06

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