EHRs Improve Collections and Charge Capture, Thereby Increasing Revenue

By: Margaret Schulte, consultant, HIMSS EHR Value Suite Collection

In my last blog post titled “Diabetes care improved and costs reduced with EHRs,” I wrote about  the amazing value that many providers have found in using the electronic health record (EHR) as a tool to help manage diabetes and support their patients in self-management of this chronic disease. Better care of chronic conditions such as diabetes is key to improving population health, as well as to the strong financial performance of healthcare providers.

For the past three years, HIMSS has been collecting published research, articles and stories about the value of EHRs. These stories have been written by and about providers in an array of settings, from hospitals and health systems to community health organizations and physician practices. These value stories tell of the myriad of benefits that EHRs bring to providers, patients, payers, and the population as a whole. In the EHR Value Suite Collection, HIMSS has organized more than 16,000 examples of EHR-derived value under five categories or value STEPS: Satisfaction, Treatment/Clinical improvement, Electronic Secure Information/Data, Patient Engagement & Population Health, and Savings. 

This article focuses on the last of these value domains: savings; more specifically, value in “improved collections and charge capture.” Improving financial performance is challenging under the growing constraints of today’s payment systems. However, one area in which medical practices and health systems are reporting improvement is in control of coding and billing. 

Because EHRs are more efficient and thorough in capturing charges at the point of care, billing is more accurate and time-to-payment is quicker. For example, Desert Bloom Family Medicine in Phoenix reported that its EHR captured charges more easily, allowing the practice to get paid properly for all the services it provides. All Care Clinical Associates in Asheville, N.C., found in that it had a 67 percent reduction in claims denials, due to its EHR implementation. When improved coding prevents lost charges and claims are submitted with a higher degree of accuracy, the opportunity to find the “low hanging fruit” in increased revenue is significantly enhanced. Ashville Eye Associates put a number on the reduction in denied claims when the practice gained $75,000 in previously lost revenue by using the audit tracker in its EHR.

There are many other medical practices that have seen revenue improvement due to use of an EHR:

  • Coastal Medical, a recipient of the Nicholas E. Davies Award in 2012, reported increased coding efficiency.
  • James Holsinger, M.D., also a Davies Award recipient, reported that he increased his electronic filing success rate from 77.4% to 98.3% over three years.
  • Davies Award winner MedPeds found that the claims rules in its EHR prevented errors and decreased claim denials. The practice saw increased revenue of $99,000 in just 12 months.
  • Otolaryngology Physicians of Lancaster, Pa., described the value the practice achieved in having 92 percent of claims paid within 60 days, down from 90 to 180 days.
  • Olathe Women’s Center decreased insurance claims denials by 75 percent.
  • Davies Award winner Reliant Medical Group-Atrius Health in Worchester, Mass., recaptured 27 percent of claims that had been written off.
  • Advanced Orthopaedics & Sports Medicine, Casa Grande, Ariz., found that its EHR made billing much easier because now the practice isn’t required to double enter information into two programs.
  • Valdez Family Clinic in San Antonio, Texas, found that coding improvements led to a $210,000 increase in reimbursements in one year alone.

Many hospitals and health systems, in an environment of reimbursement challenges, have also experienced measurable improvements in their billings and collections as a result of their EHRs.  More accurate coding results in fewer claims denials and increased capture of charges for services provided. This theme runs throughout the value that hospitals and health systems have reported after implementing their EHRs. Beaumont Health System in Royal Oaks, Mich., for example, noted that its EHR supported mobility and rounding tools that resulted in a reduction of missed billing for treatments, from 75 percent to 13 percent over a two-year period. AHN Canonsburg Hospital in Pennsylvania reported increased revenue by 12 percent due to optimized coding and charge capture. Many others have similarly found improved charge capture value in their EHRs. Here are a few more examples, including several from recipients of the prestigious Davies Award:

  • Adventist Health System in Orlando, Fla., found that with its EHR, denied claims are quickly identified, corrected and resubmitted on the first pass.
  • Davies Award winner MultiCare Health System in Tacoma, Wash., reported a $5 million reduction in claims denials.
  • Appalachian Regional Healthcare System in Boone, N.C., reported that its EHR interfaced with a practice management system to allow physicians to enter charges directly into the system, raising the percentage of captured charges and improving billing efficiency. 
  • Sentara Healthcare in Norfolk, Va., recipient of the Davies Award, estimated that it saved $700,000 per year due to reduced denials.
  • Davies Award winner Banner Health in Phoenix, Ariz., experienced a 71.8 percent medication-related claims avoidance.
  • Davies Award recipient Hawaii Pacific Health in Honolulu avoided $13.7 million in revenue loss due to avoidable write-offs.
  • The Ohio State University Wexner Medical Center in Columbus, Ohio, a two-time winner of the Davies Award, wrote in its 2015 Davies case study that the EHR “improves charge capture in the EDs by approximately $50 million per year.”

These are only a few examples of the incredible savings and revenue improvement that physician practices, hospitals and health systems are experiencing as a result of implementation of EHRs.  These stories hold promise for other providers who are committed to optimizing revenue.

Learn more from the 2016 recipients of the HIMSS Davies Awards of Excellence during their educational sessions.


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