Outsourcing and Telecommuting The New Coding Trend


Outsourcing and Telecommuting The New Coding Trend

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Outsourcing and Telecommuting: The New Coding Trend

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There is a paradigm shift in health care that is changing the way medical records are processed. Due to the severe shortage of coders, there are many hospitals that either do not have a full coding staff or do not have an experienced coding staff. Many hospitals that do have experienced staff are losing coders to other hospitals and outsource coding companies. To retain the coding staff they have, hospitals must compete with better pay and more attractive working environments.

Many hospitals must outsource some or all of their coding to contract coding companies. They need strategies for retaining valuable employees that goes beyond pay raises. Telecom-muting is providing a new and effective approach to this challenge.

Many coders would rather work from their homes than work at the hospital. One of the biggest incentives that a contract coding company can offer potential employees is that they can code at home. Hospitals offering this incentive may preempt a “hiring attack” from other hospitals or contract coding companies.

All hospitals understand that without coders there is little or no reimbursement. Some may discount the idea of outsourcing their coding or having some coders working at home, but they’re resisting the inevitable. Outsourcing and telecommuting are powerful trends in America and the health care industry is accelerating its acceptance of both practices. Hospitals can be proactive in the coding arena or reactive. However, being reactive in health care is usually very expensive and always causes heartburn.

The History Behind the Move
As late as five years ago, the idea of “outsourcing” medical records coding was an anathema to the vast majority of medical records directors. Hospitals “insourced” coding by bringing temporary coders on site to alleviate coding problems, but they were reluctant to let their charts go off-site. Why? Because nobody had ever done it before, and they did not want to risk a confidentiality breach or lose control of their charts.

I remember coding consulting companies and many medical record directors saying that outsourcing coding was a crazy waste of time. Even when it was pointed out that transcription outsourcing was just another “crazy” idea five years earlier, they just smiled and shook their heads.

Outsourcing coding has evolved into a necessity. Hospitals are realizing that if they want to survive, they must adapt. Health information management (HIM) directors realize that a nationally based coding company probably offers more resources and experience than most local options. There are several coding companies across the United States that will code in excess of one million charts during the next 12 months. These coding companies employ some of the most experienced coders in the marketplace. Many hospital-based coders, due to the number and types of charts they see, will not accrue this level of experience.

Different Methods
Technology has been playing catch-up with industry needs for many years. It has always been difficult to transport charts from one location to another in an expeditious and secure manner. Since the early 1990s, many different methods have been attempted–some successfully, some not. These methods ranged from the U.S. mail, to overnight delivery, to scanned charts on optical disks to faxing. With recent developments in transport mechanisms and encryption technologies, the above methods are quickly becoming obsolete. Some of them will be around for the next couple of years, but eventually all records transported off-site will travel over incredibly fast and secure network connections.

New Technology
The last year has seen an explosion in data transport technology. Hospitals are scanning and transporting charts through a variety of vehicles and the technology gets faster, more secure and more accurate all the time.

Several companies offer a version of transport technology, including MedGrup (Monument, CO), which pioneered remote coding over seven years ago. All transport systems aim to accomplish the same end goal–the accurate, secure and expeditious transport of medical record charts.

The ideal transport system uses a high-speed scanner/PC configuration to convert medical records to a compressible file format and then transport them to an off-site central server via high-speed modems and/or data lines. The charts must be 128 bit encrypted (a Health Insurance Portability and Accountability Act [HIPAA] requirement), preferably with both hardware and software encryption mechanisms and double password protection. Once encrypted, the chart should never be de-encrypted, even when viewed at the coding location. The central server routes the record to a coder and should track the chart’s location and status until the coding process is completed.

Once the chart has been coded, the coding summary is sent back to the server where it is attached to the chart and filed in the server. It will be saved for a short period to accommodate internal quality assurance (QA) and to support the coding summary until the hospital receives reimbursement. No hardcopies of the chart are produced and the electronic record is automatically deleted after a preset time period. The coding summary is routed to the originating hospital where it is attached to the applicable chart, thereby giving the hospital a complete record. This record can be saved in any format, giving the hospital an electronic medical record (EMR) option that can be accessed or exported, with the correct software and passwords, by anyone with proper authorization.

Once the coding summary is returned, the hospital has several choices. Often, the summary is printed out and manually entered into their system. Depending on both the hospital information system (IS) and the transport software, the summary can also be automatically exported into the hospital’s system and the bill dropped. The transport system should have an automatic reporting system that will tabulate various statistics, such as coder productivity, chart status, turnaround times, etc.

This new technology application not only allows an outsource coding company to have its coders work from home, but allows hospitals to do the same.

Technology Choices
There are several transport systems on the market, many with similar offerings.

The four key characteristics in any transport system are:

  • Security: All files must be encrypted (128 bit) preferably using both hardware and software mechanisms. The chart should remain encrypted at all times, even while being coded.
  • Connectivity: The choices are continuous connectivity with the server or receiving the chart as an e-mail or electronic message, requiring only periodic connection. One of the problems with coding while continuously connected is the risk of line interruptions or failures. Security can also be more problematic with extended connectivity.
  • Routing: The choices are automatic or manual. If the chart is automatically routed from the hospital to a pre-assigned coder, there is little chance of it being sent to the wrong location and there are no server “bottlenecks.” If the chart is manually routed, the human interaction makes the system vulnerable to errors.
  • Platform: A system developed with an open platform (even with proprietary customization) can more readily be interfaced with various hospital IS platforms. A smooth interface will accelerate the flow of information from admissions to billing, thereby expediting reimbursement.

Costs for Outsourcing

  • Coding: A typical cost for the outsourced coding of an inpatient chart, including transportation is $25, an emergency department (ED) chart (professional and facility including both levels of service) approximately $6, and an outpatient visit about $2.50.
  • Transportation: The cost to transport charts is determined by their size. An inpatient chart transported to hospital-employed coders working at home should ballpark around $1.50, with the cost of transporting an ED chart somewhere around $0.35. Tracking and all necessary reports should come included.
  • Hardware: Hardware costs will vary by the configuration and scope of operations, but a basic transport system should run under $8,000 at the hospital and under $6,000 for each remote coder.

The benefits of outsourcing and telecommuting to health care are substantial. The trend toward their implementation is irreversible. Health care providers must accept and adapt to new services and technologies to remain competitive and viable.

William D. Cronin is the chief executive officer of MedGrup Corp., Monument, CO. You can reach him at wdc@medgrup.com.

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