Based on the EHR Project case described in Module 01, write a 5-6 page project plan draft. This project plan should include the following:

• Description of the overall and specific goals for the project, including an explanation of the overall goal and the approximate scope of the project.

• Description of the organization, and its characteristics and climate in which the project will be deployed.

• A breakdown of the project lifecycle, explaining what will take place during each phase and who will be involved. This portion needs to demonstrate understanding and application of each of the project lifecycle phases to the Good Apples Group project. What tasks will occur at each stage?

Module 04 – Corporations, Contracts, and Antitrust Legal Issues

The Healthcare Organization as a Corporation

Members of healthcare organizations, including the CEO, administrators, managers and even department directors are often able to take actions which may have legal implications or impacts for the organization. In order to have certain legal protections healthcare organizations frequently define their legal status as a corporation either for profit or not-for-profit. Whichever the organization chooses there are specific responsibilities that the organization must comply with in order to maintain corporate status. Corporation status makes the organization a legal entity that is a “person” under the law and generally this provides some form of personal protection for those members of the healthcare organization that are involved in taking actions, such as entering into contracts, which can have legal implications. Governing Board members, although having a fiduciary duty for oversight they are usually not an agent or employee of the healthcare organization and so do not enter into contractual agreements for the organization.

Contract Elements

Before addressing specific issues relating to Health Information Technology Contracts it is important to be able to identify and understand the elements of contracts in general and the possible defenses for nonperformance of a contract. A contract must comply with any state and federal statutes or regulations and must describe an agreement between two or more person or entities. Additionally is must include a valid offer, acceptance of the offer, and consideration (what does each party receive, such a monetary compensations, services or materials).

Breaches of Contract

Violations of any of the terms of a contract can result in a lawsuit alleging a breach of contract. The plaintiff must be able to prove a breach of contract by demonstrating that a there is an executed contract, the plaintiff met his requirements of the contract and the defendant failed to meet the requirements which caused an economic loss to the plaintiff. Because these plaintiff must prove all of these items to prevail in a breach of contract it apparent why the terms of the contract are so important when a healthcare organization enters into a contract for goods or services. There are several defenses that can be used in a case of nonperformance which may be successful for the defendant in not receiving a breach of contract finding; fraud, mistake of fact, duress, illegality or impossibility.

Health Information Technology Contracts

Some of the most common types of contracts that HIM professionals may have accountability for relate to purchasing services or capital items. For example the contractual agreements for services for transcription, release of information, record destruction, and encoders may fall under the responsibility of the HIM director at a hospital for review and recommendation.

Health Information Management professionals may having varying roles in an organization’s contracts relating to health information technology. Depending on both the organization’s structure and the HIM professional’s role within the organization, these roles may range from the most basic of using the organization’s selected technology, through implementation of technology and even participation in developing requests for proposal, and technology selection. In roles relating to requests for proposal and technology recommendations for selection, contract review may be a part of the process. Most times the review and selection of Health Information Technology will be undertaken by a team or task force and the HIM professional will be asked to be a member of that team. Whatever the specific role is it is important for the HIM professional to understand how health information technology contracts are frequently prepared by vendors selling the technology.

Of major concern is the inadequate protection for the organization, the purchaser or lessor of the technology, against liability resulting from the technology. Contracts for purchase or lease written by the vendor, generally favor the HIT vendor in liability protections. This may be especially true if the contract the organization accepts is a “boilerplate” agreement, which is a term that relates to a standard contract, which is not modified or only slightly modified. A “boilerplate” contract can certainly be used as a starting point in the review and negotiation process with a vendor but should not always be reviewed with the organization’s needs in mind and a view of the risks and liabilities that the organization may face with the implementation of a new or the replacement of an existing Health Information related technology- contracts should not be viewed as “one size fits all.” Areas to be aware of are terms within the agreement which put the liability on the system user, the organization or provider, even when the user has followed the vendor’s guidelines and instructions.

The proliferation of electronic health record (EHR) systems in all types of healthcare organizations, from multi- hospital health systems to individual physician offices and the number of vendors offering both hardware and software solutions has begun to bring the importance of these health information technology contracts to the forefront. Unlike some other areas in healthcare, such as medical devices, there has been no standard way to report on issues with health information technology in a way that could be shared with potential and current users. The organization must be thorough in its review of both the technology and the contracts relating to the technology to ensure that there is adequate protection. Organizational review of contracts relating to health information technology is best undertaken by someone who not only understands the laws relating to contracts but also understands the technology. Depending on the technology being reviewed HIM professionals may be in a unique position to provide input on the technology as the contracts are being considered.

The following PowerPoint presentations will guide your note taking as you explore the key concepts related to this module.

Fundamentals of Laws for HI and IM, Chapter 6

Reading – Fundamental of Law for Health Informatics and Information Management, Third Edition, Chapter 7

Administrative information systems, which manage the business of healthcare, were the first information systems to be used in healthcare. The data collected in administrative information systems are mainly financial or business-oriented in nature, rather than clinical. The administrative information systems perform many tasks throughout healthcare organizations. Some administrative systems, such as the master patient index (MPI), are used by many departments and employees throughout the organization. Other administrative information systems, like the decision support system, are utilized only by a select group of authorized users. The hospital information system, the major information system used by a healthcare facility, is made up of many administrative systems, such as the financial information system and the MPI. The main administrative information systems are summarized in the following list. Each of these components will be discussed separately:

• The financial information system monitors and controls the financial aspects of the healthcare facility.

• The human resources information system (HRIS) tracks and manages all employees and other contracted personnel within the organization.

• The decision support system (DSS) gathers data from a variety of sources to assist management and staff in decision-making tasks associated with the nonroutine and nonrepetitive problems.

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• The master patient index (MPI) provides a permanent record of patients treated at the healthcare facility.

• The patient registration system collects information on patients receiving treatment.

• The scheduling system allows the facility to make efficient use of resources such as operating rooms.

• The practice management system combines a number of applications required to manage a physician practice.

• The materials management system manages the supplies and equipment within the facility.

• The facilities management system allows physical plant operations to control the automated systems within the facility for patient safety and comfort—that is, heating and air systems, automated key control, and preventive maintenance tasks such as testing fire extinguishers, elevator inspections, and the care of various equipment used in the healthcare facility.

Financial Information System

The financial information system is critical to the fiscal health of the healthcare facility. The healthcare facility must receive accurate financial information in a timely manner to monitor and manage the finances of the healthcare facility. This information can be used to plan and control the expenses of the day-to-day operations, as well as long-term investments.

The management of the accounts receivable and the accounts payable on a daily basis by the healthcare facility is known as revenue cycle management. The revenue cycle is a very complex process involving several departments and many employees who perform tasks of reviewing services provided for claims submitted as well as reviewing outstanding claims, returned claims, denials, missing accounts, bill holds, and other claims involving the revenue of the healthcare facility. Many health information management (HIM) professionals are involved in working with the revenue cycle in their facilities and some work for vendors who specialize in the area of revenue cycle management and clean-up as a business.

Financial Information System Functionality

The financial information system includes functions related to:

• Patient accounting

• Accounts receivable

• Accounts payable

• General ledger

• Investment management

• Contract management

• Payroll

• Billing and claims management

The patient accounting module collects all of the charges related to patient care. Some charges, such as the patient’s room charge, are automatically generated, but others are created when nurses, respiratory therapists, and other staff enter charge information either through the financial information system or through a clinical information system that captures the information automatically and then shares it with the patient accounting system. These charges come from the chargemaster, shown in figure 7.1. A chargemaster is a financial management form or software that contains information about the healthcare facility’s charges for the services it provides to patients (also called a charge description master [CDM]). The chargemaster automates the coding process for routine procedures such as laboratory tests and radiology examinations. Attached to each of these codes is the charge associated with the service. This amount and other charges recorded are used to determine the amount of money charged to the patient’s account. For example, a healthcare facility may charge $100 for a chest x-ray. The information system then generates the bill and submits it to the third-party payer. The patient accounting system also generates the discharged not final billed report, which lists the patient accounts that have not been billed.

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Source: Pilato 2013.

Because the chargemaster has such an impact on the healthcare facility, periodic updates are required. The classification system codes must be updated annually; HIM professionals must ensure that their respective chargemaster updates are completed annually by the healthcare facility’s information systems (IS) department when the software updates are received. Otherwise, charges billed can mean a loss of revenue to the healthcare facility. Once the updates are performed on schedule, the healthcare facility is reimbursed the amount they are owed based on their particular geographic region of the country.

Accounts payable records what the healthcare facility owes to others. This amount may be a refund to a patient or an insurance company, or it may be payment to companies that provide supplies and equipment to the healthcare facility.

The general ledger records debits and credits to the various accounts managed by the financial information system. All of the financial transactions are recorded for the time frame. These transactions include receipt of payment, payroll, and disbursements.

Healthcare facilities invest their excess cash. The investment management features of the financial information system track the investment accounts and analyze the return on the investments. Changes to the investment portfolio can be made according to the findings.

Healthcare facilities sign many contracts, including those with software vendors, insurance companies, businesses that purchase healthcare services, and many other companies. The contract management portion of the financial information system can track particulars such as who the contract is with and expiration dates. The information that comes from the financial information system is used to negotiate managed care contracts and monitor the impact of the contract based on information such as the number of patients, amount of revenue, cost of care, and whether or not the facility is making money on the contract.

The last module of the financial information system to be discussed is the payroll functions. Payroll functions include tracking employees, salaries, taxes to be deducted, taxes to be paid, health insurance deductions, life insurance deductions, and direct deposits. The payroll functions would need to track salary increases and changes in deduction from one year to another.

The information is also used to generate financial reports that are needed by the healthcare facility’s management staff. The financial information also provides the balance sheet, statement of revenue and

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expense, cost reports, and illustrates cash flow. These financial reports can assist in the pricing of services rendered, control inventory, analyses of productivity of staff, and other purposes.

Impact on HIM

The coding professional staff will populate the diagnosis and procedure codes either through direct data entry or from an interface to an encoder. HIM and coding staff have always played an integral part in the financial viability of the healthcare facility. This is particularly true with the completed transition to International Classification of Diseases, Tenth Revision, Clinical Modification (ICD-10-CM) and International Classification of Diseases, Tenth Revision, Procedure Coding System (ICD-10-PCS). Extensive and continuous training is required to maintain optimal skill in identifying the correct and appropriate diagnostic and procedural codes. With the massive increase in the number of codes due to increased specificity in ICD-10, coders must be thoroughly trained in anatomy and pathophysiology to assign the precise codes. However, codes can only be as accurate as the documentation allows. Clinical documentation improvement (CDI) is the process an organization undertakes that will improve clinical specificity and documentation that will allow coding professionals to assign more concise disease and procedural classification codes. The quality of this documentation is vital in order to properly evaluate patient care, meet all regulatory requirements, and obtain the appropriate amount of reimbursement. Because quality documentation, whether it be paper or electronic, is one of the cornerstones of the HIM profession, it is essential for the HIM and coding staff to be integral in all phases of CDI.

HIM professionals should also be involved in the development and management of the chargemaster. Services are added to and removed from the chargemaster as the services provided by the facility change. Both ICD-10 and current procedural terminology (CPT) classification codes are updated on a regular basis. These changes must be implemented and verified within the facility’s chargemaster. In addition, the monetary value associated with each code must also be confirmed. Upwards of 700 new, revised, and deleted codes have been implemented for the 2018 fiscal year (CMS 2017).

Analysis of chargemaster data can indicate changes in billing time frames, productivity of coding submissions, reimbursement denials, diagnoses, and procedures that are most resource-intensive or cost-effective. The analysis of the billing and coding information and reports will help both HIM and finance departments to conduct performance improvement activities to become more efficient.

Human Resources Information System

A healthcare facility requires many staff members in order to operate. Many healthcare facilities operate 24 hours a day, 7 days a week. Because of staffing requirements, payroll expenses make up a large part of the operating budget. This large outlay of cash demands strong management of the human resources department within the organization.

Functionality

The HRIS tracks employees within the organization. This tracking includes promotions, transfers, terminations, performance appraisal due dates, and absenteeism. The individual data elements collected include:

• Employee name

• Employee number

• Department

• Title

• Salary

• Benefit information

• Hire date

• Results of performance appraisal

• Previous titles

• Termination date

• Certifications

• Disciplinary actions

• Eligibility for rehire

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These elements and other data are used to create a permanent record for the healthcare facility. This information is used to manage current staff and to verify that past employees worked at the healthcare facility. The HRIS data will track the benefits that an employee has selected, such as family healthcare plan, dental insurance, long-term disability insurance, and retirement. The HRIS will be able to track the utilization of staff by department, job title, or other grouping. The human resources staff would have access to the records of all employees, whereas the various department directors should have access only to those employees reporting to that director.

Department managers may use an automated timekeeping system for their employees when staff members clock in and out. This HRIS tracks the hours per week worked by pay period. Human resources and managers can then use the HRIS to determine sick time, vacation time, and benefit time per employee.

The HRIS can also assist with the hiring process. For example, the HRIS can track résumés and applications submitted by potential employees. The information system can compare the skills and education of the candidate with those of the other applicants, thus speeding up the hiring process.

Reporting is important in the HRIS. Reporting features can be used to track items such as turnover rate, open positions, labor costs, benefits, budget, or overtime. The healthcare facility may also track employee satisfaction and report on the findings of the surveys. Many facilities offer in-house educational opportunities to employees and attendance at these events is tracked within the HRIS software. These might include optional educational seminars to advance managers with training and development skills. Other workshops might include cardiopulmonary resuscitation (CPR) training classes for staff. The HRIS software may also track mandated classes for all employees that require annual attendance such as fire and safety classes, OSHA standards, privacy and security training, and so forth. Department directors can then easily use the reporting function to assess the attendance within their own departments as well as results of these educational classes by their employees annually.

Impact on HIM

HIM department staff do not use the HRIS; however, the HIM director may use HRIS to generate reports, perform queries, review applications, and perform other tasks related to the HIM department staff.

1. Which part of an administrative information system would be able to identify which surgeries are most profitable for the healthcare facility?

a. Encoder

b. Decision support

c. Financial management

d. Practice management

2. Which information system assists the coding professional in selecting the appropriate code?

a. Encoder

b. Decision support

c. Chargemaster

d. Practice management

3. Which information system would be able to identify employee turnover rates in all departments within the healthcare facility?

a. Decision support

b. Revenue cycle

c. Human resources information system

d. Materials management

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4. Typically, a chargemaster is updated from software on a(n) ______________ basis.

a. Annual

b. Quarterly

c. Monthly

d. Weekly

5. Which classification system updates must be implemented and evaluated annually in a facility’s chargemaster?

a. ICD-10-CM

b. ICD-10-PCS

c. CPT

d. All of the above

Decision Support System

The DSS, as defined earlier, is an information system that gathers data from a variety of sources and assists in providing structure to the data by using various analytical models and visual tools in order to facilitate and improve the ultimate outcome in decision-making tasks associated with the nonroutine and nonrepetitive problems. It is also used to solve structured problems. This means that the DSS is not used to schedule staff, determine inventory levels, or perform other routine decisions, but rather to make decisions about whether to open a new women’s health center or a geriatric center. Other decisions that may be candidates for the DSS are whether or not to add new examination rooms in the emergency department or to open new operating rooms. To make these decisions, the DSS utilizes the data in the data repositories and data warehouses. The DSS uses models to run analyses such as “what if” to determine what would happen if certain decisions were made or to forecast the future. For example, the DSS would evaluate the profit or loss that would occur if a hospital added an extra patient room in the emergency department. It would take into consideration extra costs, extra patients, reduced wait times, extra staff, and more.

Executive Information System

The executive information system (EIS) is a type of decision support system that is designed to be used by healthcare administrators. As such, it must be easy to use and have access to a wide range of data. With the EIS, a lot of graphs and charts generally are used as part of the results. Advantages of the EIS include:

• Improved competitiveness of the healthcare facility

• Knowledge of the healthcare facility

• Making information available to authorized users throughout the healthcare facility

• Assistance in making strategic decisions about the healthcare facility

The EIS assists the administrator and other top administration staff in making quick decisions. To generate the data manually that the EIS generates with a few clicks of the mouse would take days.

A dashboard report gives administration-structured information to make intelligent decisions for the future. In this example, administration can view the dashboard report and see from the diagnostic-related groups (DRGs) and the length of stay (LOS) what the facility was actually reimbursed and what it actually cost the facility to treat the patient. The last columns give administration an idea of the profit that was expected versus the actual profit made. This type of report is useful to administration in planning for the future to make decisions.

Figure 7.2 shows an example of an EIS dashboard report. Administrators can view detailed data by types of graphs that are selected, depending on the software used. For this example, several bar charts and graphics are used. Administrators can easily view an EIS dashboard report and see the practice performance activity of the physician highlighted. In this case, performance is evaluated by identifying patient load, wait

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times for the patients, satisfaction survey results, and general patient demographic information. The same measures can be used to evaluate and compare all the other physicians listed across the top of the screen. Administrators must focus on the fluctuating monthly patient load and the differences in monthly wait times for various physicians. The data from this EIS planning tool is a visual representation to administration of where the problem is greatest and where the priority should be focused. The HIM department may or may not use the DSS depending on the type of DSS and the data stored within it.

Source: iDashboards n.d. Reprinted with permission.

Master Patient Index

The MPI is part of the hospital information system. It is a patient-identifying directory, referencing all patients related to a healthcare facility, that also serves as a link to the patient health record or information, facilitates patient identification, and assists in maintaining a longitudinal patient record from birth to death. The MPI identifies every patient who has been admitted to the healthcare facility, and it is the key to locating all patient health records. The MPI lists patient names and health record numbers and cross-references them. An MPI is to be kept permanently as mandated by legal statutes. The inform

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