Sample Healthcare Paper on Departmental Impact on Reimbursement

Departmental Impact on Reimbursement

In every healthcare organization, there are various departments which perform different functions such as management of health information, compliance, human resource management, and utilization management. Data flow in a healthcare organization is designed to guarantee that the necessary information is available for personnel to carry out various functions. Healthcare information system allows recording, storage processing and access of data. There are different departments in a hospital which are classified into four general departments: the administrative departments which deal with human resource management, volunteer services, purchasing and legal compliance. The operation units are the supply center which performs risk management, quality assurance, and utilization management. Clinical departments where the medical staff is found, and this is where the health needs of a patient are catered. Further, the financial department is where accounting tasks, patient’s financial services, credit, and collections are executed.

Various hospitals have put into action measures of utilization management that ensure the standards for patients care are met. Utilization management ensures that all usage guidelines are met, and reimbursement is done appropriately for all hospital services. For the repayment to be effected, an admission evaluation protocol (AEP) criterion has to be followed. A peer review organization contracts with medical insurers to review cases of patients to assess their medical appropriateness and necessity. Peer review organization has an impact on reimbursement since it has the jurisdiction to deny hospital admission payment where the AEP criterion is not met (Hills& Selby, 2015). Coding and billing audits are necessary because they identify overpayments and underpayments and relations will be better among all departments since individuals in the healthcare department will understand how they affect each other’s work processes.

Ideally, in an organization where billing is dependent on the timely and accurate use of CPT or HCPCS codes which generates Ambulatory Payment Classification Groups, there is need of a billing and coding system. Specifically, a complete and accurate coding is essential to the success of APC reimbursement. Ambulatory Payment Classification audit ensures that an organization identifies, manages and rectifies billing practices that are inappropriate and might bring up compliance issues (HCPro Inc., 2006). Moreover, auditors should perform periodic follow-up audits to make sure that the procedures of handle organization issues pertaining accuracy and quality of the billing and coding process. The audit should cover the policies that have an impact on efficiency and appropriateness of outpatient coding inclusive of department processes and physician documentation. Likewise, it should ensure that there is compliance with claim and coding laws and scrutinize APC reimbursement losses resulting from missing documentation.

Pay-for-performance payment approach is adopted widely with an aim of health care quality improvement. The impact of pay for performance incentives can be measured by one, examining the process where assessment of activities’ performance is deemed to have contributed to patients’ positive health outcome. The second approach is looking at the outcome to identify the effects that the care had of patients. Third, the patient’s experience, especially their quality perception and satisfaction and finally the structure that is the personnel, facilities, and equipment used for treatment (Robert Wood Johnson Foundation, 2012). Each department in a health care organization has a significant impact on reimbursement depending on the activities performed. For instance, the financial department looks into accounts receivables, presents metrics on payment denials and collection rates. This will have an effect on reimbursement because the activities will be a determinant of the amount of money to be reimbursed. Again, the operational sector performs the task of vendor relationships, staffing and workflows availing data to be used in reimbursement (Murphy, 2016). Similarly, the technical side monitors applications and the entire patient and provider interaction process.

The administrative department under which the compliance department is found ensures that the billing and coding process complies with the legal policies. Medical and billing compliance refers to health providers’ ability to practice medical care by the Health Insurance Portability and Accountability Act (HIPAA) and the regulations set by United States Office of Inspector General. According to Medical Billing and Coding Online, HIPAA bears medical guidelines which clinicians have to adhere to for them to ensure security and accountability regarding patient’s medical information. Regarding coding and billing fraudulent activities are curbed by HIPAA, and it establishes standards for electronically transferring the information of patients. The health insurance portability and accountability Act has an impact on reimbursement because it sets national standards meant to protect personal health information and medical records of individuals. Additionally, HIPAA makes it possible for patients to understand the use of their information and find out some of the disclosures that could have been made (Benefits, 2014). For a fair reimbursement, patients can examine and obtain their health records copy, and this allows them to request for corrections. In the case where an employer acts as an intermediary between their employees and insurer when providing a self-insured health plan they will have to comply with the protected health plan that is under the privacy rule of HIPAA.




Benefits, Z. (2014). HIPAA Privacy Rule – What Employers Need to Know for Section 105 Reimbursement Plans. Retrieved 25 April 2016, from

HCPro Inc. (2006). Billing and coding audits made easy (pp. 1-6). Marblehead: HCPro Inc. Retrieved from

Hills, B. & Selby, J. (2015). ICD-10's impact on reimbursement. Managed Healthcare Executive. Retrieved 25 April 2016, from

Medical Billing and Coding Online (N.D). Medical billing compliance and guidelines. Medical Billing and Coding Online: Learn About the Industry!. Retrieved 25 April 2016, from

Murphy, K. (2016). Key Ways to Improve Claims Management and Reimbursement in the Healthcare Revenue Cycle. RevCycleIntelligence. Retrieved 25 April 2016, from

Robert Wood Johnson Foundation, (2012). Health Policy Brief. Pay-for-Performance. New payment systems reward doctors and hospitals for improving the quality of care, but studies to date show mixed results. Retrieved 25 April 2016, from