3M Health Information Systems, Inc.: Converging coding and medical record management

June 24, 2011
At 3M Health Information Systems, Inc., improving healthcare means putting together the three most important aspects of healthcare's bottom line:

At 3M Health Information Systems, Inc., improving healthcare means putting together the three most important aspects of healthcare's bottom line: Documentation for medical coding/reimbursement, clinical/financial document management, and quality management.

The Salt Lake City, Utah-based company has a longstanding reputation in the coding world, but its global reach gives it insight into how coding and complete documentation need to work together to support quality improvement, says Nancy Larson, President.

“We have a specialty around healthcare information as it relates to the economics of how healthcare funds are distributed based on resource consumption, case management and performance management,” she says. “We have seen how other countries have leapfrogged ahead in the coding arena with the earlier adoption of ICD-10, and in creating significant enhancements around quality management monitoring.”

The company's medical record products now combine detailed admissions data, an engine to check for medical necessity, and a case management system with coding and revenue cycle management solutions. Capturing more complete information prior to care delivery will allow hospitals to perform analyses on their potentially preventable readmission and complication rates. “It's very difficult for providers to know if they're managing the quality of care effectively if they do not understand what the patients are coming in with.”

Since the 2006 merger with SoftMed Systems, Inc., 3M has integrated its coding and reimbursement systems with dictation/transcription and document management solutions. The maturation of the merger has added remote coding applications and soon, computer-assisted coding, Larson says.

3M Comprehensive Pricing Assurance Program, a consulting product released in June 2008, begins with a comprehensive evaluation of the chargemaster, including a line item by line item review of coding, charging and other issues to pinpoint problem areas. 3M consultants then work on-site with hospital departments to accurately capture appropriate codes for services provided, and to recommend corrective action to the chargemaster and coding and billing processes.

Once the facility's chargemaster is accurate and up-to-date, 3M Comprehensive Pricing Assurance provides a complete analysis of the facility's current pricing methodologies, mark-up formulas and payer mix. “With this product, our customers can generate an average of $2.7 million in additional revenue over and above an across-the-board price increase, while still maintaining a competitive and solid pricing rationale when compared to peer organizations,” Larson says.

“During the past few years, we've been moving from products centered on coding/reimbursement in the HIM department to solutions that are much more multi-departmental,” Larson says. “We're able to help hospitals understand the impact of things like MS-DRGs and how proper documentation helps capture appropriate reimbursement under the new reimbursement rules.” Documentation responsibilities have increased dramatically over the past few years, but hospitals can't afford to let revenue slip through the cracks, she adds.

One of the next big challenges for hospitals will be implementing the proper documentation, coding and admission practices to help secure appropriate reimbursement as reviewed by CMS' Recovery Audit Contractor (RAC) audits, Larson notes. The RAC project, CMS' new endeavor to recoup its revenue from hospitals, has further proven healthcare's need to collect and document complete information prior to delivering care. “Managing admissions, observations, and outpatient services of the Emergency Department is really critical in balancing the delivery of medically necessary quality care that will get reimbursed.”

Healthcare still has plenty of challenges when it comes to managing health information, reimbursement, resource allocation and performance. A key initiative that will move the market in the right direction will be establishing standard medical terminology, which will support connectivity, secure information access, and ultimately, vendor independence, she says. Hospitals will need to continue to embrace change management to effectively deliver quality care, she adds: “The challenge for vendors is to make sure we're not just automating the current processes, but leveraging technology to deliver better quality, more productivity and better cost savings.”

3M Health Information System's HIT revenue increased by $111.1 million between FY06 and FY07, placing the company at #16 in this year's Healthcare Informatics Top 100. Now in its 25th year, the company's 4,000-customer base includes a significant hospital and government presence, and spans 12 countries.

Healthcare Informatics 2008 August;25(8):46

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