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For other articles and previous issues click here. January 3, 2005 Global
Warming Mention “offshore” and most HIM professionals think transcription. However, overseas coding is making its presence felt as well. Accurate coding is crucial to healthcare providers. Performed incorrectly, it can dry up an organization’s cash flow and diminish its revenue. As the population has grown and greater numbers of people are increasingly seeking healthcare, the volume of charts that need to be coded is also swelling. In the face of an inadequate pool of qualified coders to meet the challenge, healthcare companies are beginning to tap the talent pools of other nations. Is it a good idea? In the healthcare industry, as in many other industries, the notion of offshoring has tended to raise anxiety levels. The practice of sending work overseas has been criticized on at least three fronts: it’s politically incorrect, produces inferior work, and is a significant security risk. However, in recent years, coding has begun a move offshore in a manner that seems to sidestep these pitfalls. With the technologies now available and the amount of information that can be transmitted electronically, remote coding is increasingly both feasible and acceptable—a practice that proponents agree is a value proposition for American healthcare organizations. While hospitals haven’t been quick to look to other lands for coders, according to Michael von Grey, chairman of RevenueMed, Inc., a Norcross, Ga.-based company that provides coding, auditing, and consulting services, physicians and physician groups have warmed to the idea. Breaking Down the Barriers During the last three years, Ajuba’s business has blossomed and its offshore coders are now coding close to 1.5 million charts annually. According to its president, Devendra Saharia, because there’s been an emotional aspect to the discussion of jobs going offshore, decision makers are sometimes nervous about exploring international outsourcing. However, he notes, since there’s been an inadequate supply of coders in the United States, political reservations about sending work overseas tend to evaporate. In addition, he observes, offshore workers are commonly used for backlog coding, so American workers aren’t being eliminated in favor of their overseas counterparts. Quality
“If you recruit properly in the offshore world,” agrees von Grey, “you can attract and retain someone of significant intellectual pedigree—a doctor or nurse, perhaps, or a person with a master’s degree—to do work that would typically be done in the United States by someone with an associate’s degree or less.” “Coding is such a crucial area that if mistakes are made, there can be very significant regulatory and financial impact. So it’s an area about which our clients are highly sensitive and have concerns,” says Saharia, who notes that reputable companies invest considerable time and money to train a select pool of potential employees and to have them meet the same professional standard by which American coders are judged. Explains von Grey, “There’s no preexisting skill set for people who perform coding functions in jurisdictions outside the United States.” Consequently, he says, “if a firm wants to aspire to the highest standards, it needs to grow its own, being able to build from scratch a full educational and credentialing capability.” RevenueMed has built a custom coding curriculum that trains workers about the U.S. healthcare reimbursement system and how to read specific chart types and puts them through a multimonth period of shadow rehearsal training. It takes the company eight to nine months to train offshore coders to do even the lower-end, less-sophisticated portions of coding. “Because we believe that a third-party imprimatur of quality is worth having, before we put these new coders on a live account we pay to fly an authorized tester from the United States to our location in India to administer the CPC or CPC-H exams to our staff,” von Grey says. “It provides an extra measure of independent validation that we’ve trained people to standards that are at least as high as their domestic counterparts.” Ajuba, like RevenueMed, ensures that its coders are certified by the American Academy of Professional Coders (AAPC). According to Saharia, at any given time, more than 80% of its coders are certified and the others are in training. “We have trainers from the AAPC in the United States come to India and train the workers and proctor the certification examination,” he notes. “We train them and let them go through a practice period. Our goal is that everyone who joins our team is certified within a year.” At Apollo Health Street Ltd., a U.S. company with a back office in India, the coding department and coding process are compliant with both HIPAA and local medical review policies, according to Chief Operating Officer Divya Sehgal, CPC, CPC-H, CCS. Also, RHIT certification ensures the proficiency of coders. Apollo emphasizes strict guidelines for diagnostic and procedural coding and uses only reference books recommended by the World Health Organization, Centers for Medicare & Medicaid Services, National Center for Health Statistics, and American Medical Association. “Not only is the initial certification important, but also continuous education is key as the coding guidelines change regularly,” says Sehgal. Most of the coders are members of U.S. coding associations who stay up-to-date with the changing nature of coding guidelines. Sehgal says specialization within specialties and subspecialties is key. For example, within radiology coding, interventional radiology is much different and tougher than diagnostic radiology. At Apollo, coders focus on certain specialties to help them attain higher productivity and superior quality. The fact that Apollo manages large volumes of coding work—upward of 2 million records annually—enables it to assign certain specialties to certain coders. Finally, says Sehgal, an independent quality assurance (QA) team is moving Apollo toward achieving Six-Sigma quality. The QA team operates independently of the operations team and regularly audits 10% of the coded reports. These are audited in real time and prior to reports going back to clients. In the rare case of a quality issue, the entire batch of work is rejected. The in-house proprietary workflow software developed by Apollo tracks the work done by the coders and the audit results of the QA team. This software calculates the quality levels in real time and helps in meeting the committed service levels. Privacy and Security Apollo is the largest hospital group in India and has been coding for its own requirements as per ICD-10 guidelines for many years—a move “that has provided immense credibility in the eyes of the client,” according to Sehgal. Furthermore, von Grey notes, offshore coding is treading on much of the same ground that was pioneered by the transcription market, in which adoption of the appropriate encryption standards and the use of business associate agreement modes of operation became commonplace. However, privacy and security issues from a HIPAA perspective are a concern for some clients, but, explains Saharia, reputable companies can address that nervousness. In addition to the fact that Ajuba’s coders are certified and therefore trained in privacy and security compliance, the company has an extensive compliance plan and strong data and network security processes that enable it to reassure clients about the movement of their data. The work is done through highly secure networks and virtual private networks in physically secure locations. Apollo relies on strict standard operating procedures to ensure security of workstations, servers, networks, and Web content and to check for misuse of data. In addition, says Sehgal, most offshore companies do not employ home coders, so the chance of data theft is further reduced. von Grey explains that because the coders work from secured, controlled locations, there’s a very different amount of control that can be exercised over who has access to the charts. Cost and Convenience There’s an additional way in which customers may get more for their money. “The relatively lower cost structure of manpower offshore allows us first to reinvest some of that surplus margin back into a number of other process improvements,” von Grey explains. “We [RevenueMed] set radically lower productivity standards for ourselves, which gives coders more time per chart to analyze and catch problems.” Whereas a coder in a domestic company in the emergency medicine department might code 200 charts per day—which von Grey notes gives a coder roughly two minutes for a chart that might be 10 pages—RevenueMed’s coders operate on a productivity standard of less than 70 charts per day. In addition, he says, the lower cost structure allows the company to invest in workflow and document imaging technology and thus reduce client costs for those services. What also helps, says Sehgal, is the economies of scale achieved by certain offshore companies. Companies such as Apollo manage a much higher volume of coding than what a physician practice or hospital would handle on its own. This further reduces costs by spreading the fixed costs over a larger volume. Convenience is also highly prized by healthcare organizations. Timeliness is critical when it comes to coding and billing, and outsourcing to a country such as India can help with turnaround time. “If bills don’t go out on time, you don’t get paid,” says Saharia. By using workers in India, he explains, his company is able to take advantage of the time difference. “When it’s daytime in the United States, it’s night in India, so our clients typically will scan us the charts in their evening time, and the workers in India will start coding those charts late evening U.S. time and early morning India time, so that by the end of the day India time, the charts are completed and sent back to the client with a turnaround time that’s quite remarkable.” In addition, says Sehgal, offshore units run multiple shifts, further cutting down turnaround time. Further, Apollo regularly sends certain members of its billing and coding staff on-site to work with the client. This helps the staff get a real-life perspective of their work and allows the client to directly interact and monitor some of the key staff. Sehgal says it is equally important for a vendor to have a business continuity plan to ensure that the client does not suffer due to any unforeseen circumstances such as strikes or natural hazards. Apollo ensures this by bringing its multiple facilities into play—30 locations across four countries, and its certified coders can work out of any of those locations. How to Choose a Vendor Then, make sure there is internal agreement about that outsourcing strategy. Buy-in from core members of the operational team is essential for a good outsourcing experience. Next, take great care in selecting a vendor. As with all endeavors, experience is key. “The market,” says von Grey, “is now sufficiently well-developed that customers should be able to expect to find a vendor who has done this type of work before and who has solid reference customers.” “Choosing the wrong vendor can hurt the entire process and the savings that one might get could be greatly offset by the costs that result when work is not done properly,” Saharia says, who adds that strong due diligence is essential to identifying the right vendors. As part of the due diligence, Sehgal encourages clients to visit the vendor’s offshore facility and examine the process and staff in detail. In light of the many nuances of coding as it relates to policy development, inventory management, and resolution of billing-related problems, von Grey recommends that the customer-facing team be based in the United States and be expert at its art. “The offshore component shouldn’t be expected to substitute for a customer service capability,” he notes. It’s equally important, says Saharia, to do business with a company based in the United States so that if something should go wrong in the agreement, you can be certain that U.S. laws will apply and be enforceable. Because account management issues can be one of the thorny issues in offshore coding, Sehgal says vendors need to ensure that they can understand the client’s requirements and be easily accessible. von Grey recommends asking about the nature of the systems and the ways they’ll be used—not only information systems, but also those outside the realm of technology. “There are nontechnology systems as well that relate to process design and process management that are just as essential to doing remote coding, whether offshore or at home,” he says, adding that he’s encountered even domestic outsourcing companies “that have next to no capability of helping their clients work through some of the really ugly inventory control issues such as tracking down duplicate registrations or finding those charts that never got scanned.” To address any concerns that may persist about privacy and security, Sehgal says, ask any company that provides offshore coding to demonstrate proof of administrative controls, employee training with respect to security, the existence of a published privacy policy stating limitations on data sharing, insurance to cover the possibility of a privacy or data security breach, and data-control procedures if the vendor subcontracts projects. In addition, he says, the vendor should give the client permission to independently audit and verify the privacy and security procedures that are used to protect data. Furthermore, every employee should sign a confidentiality agreement with severe penalties for HIPAA violations, and the vendor should be able to verify that HIPAA-compliant procedures are also “implemented in risk areas such as data processing, fax and e-mail communications to external agencies, information disclosure to payors, patients, family members, and others; and for storage, retrieval, and disposal of reports and physical records.” The Contract When contracting, Sehgal advises to make sure that there will be no hidden costs and the price quoted covers in detail all required services. Furthermore, obtain service-level agreements and ask for quality assurances in addition to proof that offshore coders are certified. Such agreements, says Saharia, are necessary to prevent disputes later. You should be able to expect a guaranteed accuracy level of approximately 95%, he suggests, while other tasks, such as data entry, charge entry, payment posting, and demographics, may be as high as 98.9%. Be certain that the contract specifies the time period covered and details the rights of each party with respect to termination of the contract. According to Saharia, contracts typically range from one to three years, although healthcare organizations may start with a trial or pilot period of several months. Be certain the contract spells out what will happen if you’re not happy with the vendor’s work, the termination period, and what penalties might exist for early termination. A typical and reasonable termination period, says Saharia, is two to three months. Also, says Sehgal, be certain that the vendor commits to the standard business associate agreement as per HIPAA and also commits to a business continuity plan ensuring that work should not be impacted for more than a reasonable period in cases of natural or man-made disasters. Finally, says von Grey, whether the contract is with an offshore or domestic vendor, “insist on the comfort of knowing that the vendor has professional liability insurance and is therefore an entity that if it were to deliver poor service, [it] has the financial means of protecting the client from any financial risk.” — Kate Jackson is a staff writer at For The Record. |
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