Observation Deck

Driving Value Via e-Prescribing

E-prescribing shortens the DME billing cycle and increases profitability. Should HMEs take a look?

• By Roxie Murray
• Nov 01, 2013

The burden of increasing regulation, declining reimbursement, and the pressure to reduce costs are driving the need for business solutions up and down the healthcare value chain. Fortunately, providers have access to an exciting and potentially revolutionary development in healthcare: electronic prescribing, also known as e-prescribing.

E-prescribing involves providing secure real-time electronic delivery of patient specific information. Benefits of the process include the elimination of data errors due to handwriting interpretation and the assurance that vital fields include meaningful and relevant data. e-prescribing is also available to the physician at the point of care.

The history of e-prescribing dates back more than 40 years to the introduction of the Computerized Physician Order Entry in 1977. Typical of the technology at the time, all data needed to be keyed into the system.

With the growth in computing power available to the average small office and the emergence of the graphical user interface in the 1980s, data entry could be performed through scrolling and selecting options that were faster and more accurate than keyed entry.

By the 1990s, approximately 2 percent of physicians were using some type of e-prescribing computer tools. The development of customized software in the university-based hospital systems advanced the technology to include flagging reminders. With the opening of the 21st Century, only 5 percent of physicians were e-prescribing. The number began to grow steadily with the highly publicized use of the technology to provide healthcare services during Hurricane Katrina in 2005. The use of e-prescribing also received a boost from the HITECH Act of 2009. The burden of increasing regulation and the pressure to reduce costs are driving the need for information technology-based solutions up and down the healthcare value chain.

Today it is estimated that 42 percent of all physicians have transitioned to some type of Electronic Medical/Health Record. Some areas of treatment have advanced the curve of adoption even further, with some 70 percent of pulmonary physicians having transitioned to EMR/EHR.

Attempts at reducing the amount of paper handling have resulted in various software tools for HME billing. A common misconception is that such tools will eliminate the need for manually processing of paperwork.

Many of the “paperless” billing solutions offered actually require considerable handling including printing, manual fill-in, manual signature and copying, scanning or faxing operations.

Reinforcing Relationships, Cutting DSOs, Building Cash Flow

The typical HME referral cycle begins when the physician sends an order or prescription by phone, fax or EMR. The HME receives the script, processes and generates documentation. The HME sends the documentation back to referral for completion. The referral receives this documentation and typically completes documentation on a schedule based on the available resources. In due time, the HME will receive the required documentation from the referral. The benefits of e-prescribing are manifested primarily in a streamlining of the referral cycle. The use of smart technology ensures all required fields are filled in, virtually reducing the possibility of denials based on submitting incomplete forms.

The elimination of faxing, printing and e-faxing saves time. Real-time notifications eliminate call-back and fax-back verifications. The resulting time savings translate to real money. The electronic processing of data also reduces fraud and the number of audits and associated costs.

Another key downstream benefit of e-prescribing is a positive impact on your days sales outstanding and increased cash flow. Decreasing the cycle time and increasing cash flow are among the most import elements in the increasing adoption of e-prescribing. Without e-prescribing it can take 45 to 90 days to complete the cycle from referral to billing. E-prescribing can reduce this cycle to a single day.

Additionally, CMS audits can be costly and time consuming. In recent years the frequency of CMS audits has been increasing. CMS employs several types of audits including those specifically targeted at an HME or patient and those that can be selected randomly at any time. In both cases, the answer to dealing with audits can be found in e-prescribing tools.

By providing both increased accuracy and accessibility of records, e-prescribing can reduce the probability and cost of an audit. The most likely cause of an audit is an error in coding or data entry. Smart technology can provide the correct codes, eliminating incomplete forms. Accessibility of the data reduces the time and cost of audits. Simply type in a patient’s name and ID number and all the information is immediately available for review. e-prescribing creates an “audit ready” environment at all times.

Audit requirements are subject to change. e-prescribing solutions provide for fast updating and the timely addition of new regulations and requirements to the system.

Focusing on Team-Based Efficiencies

Increasing government regulation will only create a more complex healthcare delivery system. In a competitive market it is important to look at increasing efficiency all along the value chain from referral to billing.

E-prescribing tools and services that directly address the challenges faced by HMEs will increase the profitability of your business and grow referrals by creating the path of least resistance and reduced complexity.

You can ask yourself several important questions that will determine the potential gains your organization might accrue through a robust engagement of the latest in state of the art e-prescribing technology.

• Is it easy for referral sources? A painless process will attract more referrals.
• Is it interactive? The system will be more productive if it can be driven by both the referral and the provider.
• Is it web-based, or an application that needs to be installed? Web-based systems require less training, maintenance and investment in software.
• Is there a transaction charge to use the e-prescribing tools or services? Solutions are available which generate sufficient value along the chain to reduce, or eliminate transaction charges.

This article originally appeared in the November 2013 issue of HME Business.