How COVID-19 Is Impacting the Healthcare Revenue Cycle

COVID-19 presents revenue cycle challenges

Yesterday, the stock market experienced its worst day since the financial crisis 12 years ago, the Wall Street Journal reports. Stocks plummeted as a result of the global COVID-19 outbreak, and healthcare providers were not immune to the trend. Stock prices for major for-profit hospital systems including Tenet Healthcare Corporation and Community Health Systems fell significantly yesterday, with many still in the red today.

But non-profit hospital systems, academic medical centers, and physician practices are also facing financial challenges stemming from COVID-19.

About a third of confirmed cases of COVID-19 in Wuhan, China where the novel coronavirus originated required ICU services, a study recently published in Lancet found. Mortality rates were also high for the disease, researchers reported. Of the 41 patients in the cohort, six have died from the infection.

A large study recently confirmed the findings, showing a case-fatality rate of 2.3 percent. The mortality rate was significantly higher among the critically ill.

The intensive services needed to treat COVID-19 patients is putting pressure on already-limited resources.

“As a comparison, there are about 46,500 medical ICU beds in the United States and perhaps an equal number of other ICU beds that could be used in a crisis. Even spread out over several months, the mismatch between demand and resources is clear,” experts from the Johns Hopkins Bloomberg School of Public Health state.

Additionally, many hospitals are already running low on key medical supplies like masks and ventilators, and many more are bracing for shortages of personal protective equipment due to the coronavirus.

Healthcare providers are rapidly implementing emergency preparedness plans, seeking places to put overflow patients, acquiring diagnostic tests, identifying and protecting staff, and more. To help providers handle the new challenges, the government and payers are helping to alleviate the revenue cycle obstacles presented by COVID-19.

Billing and coding for COVID-19

Keeping the billing office running during an outbreak is key to keeping hospitals and practices open for infected individuals requiring care. But this can be a challenge, especially for smaller organizations with limited cash on hand to respond to COVID-19 demands.

CMS has been at the forefront of helping providers handle the medical billing and coding aspect of COVID-10 testing and treatment. The agency recently released two Healthcare Common Procedure Coding System (HCPCS) codes that laboratories can use to bill for certain COVID-19 diagnostic tests, including those developed in-house according to new FDA guidelines.

The American Medical Association (AMA) also announced today that it is fast-tracking the development of a unique Current Procedural Terminology (CPT) code for reporting novel coronavirus testing.

CMS also recently released guidance on billing and reimbursement for treating COVID-19. The agency reminded providers that Medicare will pay for evaluation and management (E/M) and other services furnished in a beneficiary’s home by a physician or non-physician practitioner. Medicare will also reimburse providers for many non-face-to-face services used to assess and manage a beneficiary’s condition, the agency stressed.

For hospitals, Medicare will pay the diagnostic-related group (DRG) rate and any cost outliers for the entire stay if a beneficiary is a hospital inpatient for medically necessary care. This includes payment for when a patient needs to be isolated or quarantined in a private room.

Hospitals almost at capacity during an emergency may also be able to add a remote location that provides inpatient services even in the absence of an 1135 waiver, CMS stated.

To further support providers, the Trump administration is also reportedly weighing implementing a natural disaster program to pay hospitals and other providers for treating uninsured patients infected with COVID-19. The program typically pays providers about 110 percent of Medicare rates.

Patient financial responsibility

The COVID-19 outbreak is already highlighting issues surrounding patient financial responsibility. Several reports have surfaced of patients being left with thousands of dollars in medical bills after seeking care for potential coronavirus symptoms.

Healthcare providers are already struggling to develop collection strategies in the era of high-deductible health plans and other cost-sharing arrangements. But putting these new strategies in use during an emergency can be nearly impossible.

Payers are acknowledging the difficulties arising from patient financial responsibility and many are making it easier for patients to seek care and for providers to streamline the financial encounter.

America’s Health Insurance Plans (AHIP) announced last week that it is implementing solutions to lowering out-of-pocket costs for people seeking testing for and treatment of COVID-19. One of those solutions is covering diagnostic testing when ordered by a physician.

AHIP members vowed to “ease network, referral, and prior authorization requirements and/or waive patient cost-sharing” for physician-ordered COVID-19 testing. They will also work with providers to ensure effective treatment is available for those who are infected. This includes sharing information, mobilizing network providers, and encouraging the use of telehealth.

Allocating resources

COVID-19 is putting a lot of demand on an overburdened healthcare system, overwhelming the capacity of hospitals, emergency departments, outpatient centers. This results in critical shortages of staff, space, and supplies, which can have a negative impact on patient outcomes, the National Academy of Medicine (NAM) states.

Allocating resources appropriately when demand starts to exceed those resources is critical to keeping operations running for patients who need care.

Experts from the Bloomberg School of Public Health advise hospitals to use their flu preparedness protocols as a starting point for allocating resources to COVID-19 management. Top priorities for these organizations should be:

• Comprehensive and realistic planning based on CDC FluSurge projections and collaborative planning among hospitals in a region
• Limiting the nosocomial spread of the virus
• Maintaining, augmenting, and stretching the workforce
• Allocating limited resources in a rational, ethical, and organized manner to “do the greatest good for the greatest number”

Decisionmakers at all levels should be actively implementing these priorities by engaging in activities like dedicating a full-time infection prevention practitioner, stockpiling personal protective equipment, using buddy teaming, and identifying services and procedures that can be deferred.

NAM also recommends that healthcare providers develop “tiered, proactive strategies using the best available clinical information and building on their existing surge capacity plans to optimize resource use in the event the current outbreak spreads and creates severe resource demands.”

Specifically, the organization tells providers to:

• Protect their workforce by offering staff childcare, alternate housing, balanced shifts, and additional support and training
• Preserve personal protection equipment by reserving these supplies for those performing high-risk interventions, using powered air-purifying respirators in high-risk environments, continuous use of the supplies in a cohorted patient environment, and more
• Optimizing outpatient services by extending hours, adjusting staffing, closing or reducing specialty clinic hours, and changing documentation

NAM also provides resource allocation tips for other areas of care, including inpatient, critical care, and emergency department.

“It is important that hospitals take steps now to develop a process for decision making, anticipate what resources may be in shortage, and involve clinical staff in developing strategies to address a broad range of impact,” the organization concluded.