The Role of RCM in Health Equity

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Author: Guest Author

The following is a guest article by Leigh Poland RHIA, CCS, VP of Coding Services at AGS Health.

A strong business case exists for addressing the financial impacts of social determinants of health (SDoH) and new reimbursement models designed to emphasize health equity. Involving revenue cycle management (RCM) is necessary for any comprehensive SDoH/health equity strategy.

This is because health disparities contribute more than $93 billion in unnecessary medical care costs and more than $42 billion annually in lost productivity. Additional economic losses are a result of premature deaths. Further, according to the W.K. Kellogg Foundation, eliminating these inequities by 2050 may erase more than $150 billion in unnecessary medical care.

Reimbursement is also closely linked to quality because of the use of outcome measures by the Centers for Medicare and Medicaid Services (CMS) to determine a hospital’s overall quality, including:

  • Mortality
  • Safety of care
  • Readmission rate
  • Excess stay
  • Patient experience
  • Effectiveness of care

SDoH Factors Impacting Patients and Revenue

In particular, readmission rates, utilization, and excess inpatient stays all point back to SDoH. Additionally, low literacy is linked to poor health outcomes and less frequent receipt of wellness services — leading to more frequent extended hospital stays for these individuals.

Lack of access to reliable transportation for essential health needs results in 41% more excess days in the hospital. In addition, unemployment is linked to a rise in self-reported declining health status and increased mortality rates for males and females ages 16 through 64. Additionally, drug and substance abuse and dependence quadruple for these same populations, and diagnosis for depression or general anxiety disorder doubles within this segment of the patient population.

These metrics are a vital part of a patient’s SDoH story when this information is documented in the patient’s chart. Thoughtful documentation allows coders to assign appropriate codes for tracking and trending SDoH patterns, enabling healthcare organizations to understand their patient populations better.

A Health and Revenue Driver

CMS is clear in its telegraphing of the critical efforts to improve health outcomes by establishing quality metrics.

Its priorities inform efforts for the next decade and how the agency will operationalize each to achieve health equity and eliminate care disparities. Each priority area reflects a key place where CMS stakeholders from underserved and disadvantaged communities express that CMS action is needed to advance health equity.

One of CMS’ most important SDoH tenets is data collection and reporting. “CMS strives to improve our collection and use of comprehensive, interoperable, standardized individual-level demographic and SDoH data, including race, ethnicity, language, gender identity, sex, sexual orientation, disability status, and SDoH. By increasing our understanding of the needs of those we serve, including social risk factors and changes in communities’ needs over time, CMS can leverage quality improvement and other tools to ensure all individuals have access to equitable care and coverage.”

RCM professionals constantly interact with data that is valuable to informing health equity strategies – particularly since the transition to the ICD-10 code set that created an environment rich with data detailing SDoH.

Code sets and coding guidelines have expanded over the years to capture SDoH information at a level not possible with other data sources. ICD-10-CM Z codes, for example, capture detailed SDoH information directly into the patient’s record for deeper insights into factors impacting health.

 Closing the Gap

SDoH insights can help caregivers recognize the need for additional services for individuals to access healthy food and reliable housing and drive better health and wellness outcomes.

The challenge for many providers is their inability to manually sift through mountains of data to discover valuable health equity insights. Effectively leveraging SDoH information to achieve goals requires a carefully designed and implemented strategy, starting with forming a governance committee that designs policies and procedures so that SDoH needs are assessed and patients are connected to the community services needed to address them.

Despite the critical role this information plays in care outcomes, most healthcare organizations that collect this information still need a governance committee to oversee its use. For example, of the 56% of organizations reporting in an AHIMA survey that they collect SDoH data, 73% said they had no formal oversight committee. This is a critical gap, as governance of these policies helps determine who within the organization conducts patient assessments and how to gather the data without creating an administrative burden.

Top Priority

Health equity is a top priority in the coming years. As stewards and centralized life-saving hubs of their communities, healthcare providers can address more than basic catch-and-patch healthcare by exploring opportunities to eliminate disparities and improve care among underserved communities.

The data aggregated daily by coders and RCM professionals, mainly using the detail-rich Z codes, can play a pivotal role in understanding population needs and aligning patients with necessary resources to address SDoH issues and close the health equity gap.

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