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Cost-benefit analysis of retrospectively identifying missed compensable billings in the emergency department

Andy Lim1, Alvin Lim2

  • 1Department of Emergency Medicine, Monash Medical Centre, Melbourne, Victoria, Australia.

Emergency Medicine Australasia : EMA
|June 14, 2020
PubMed

Insights

Retrospectively identifying missed compensable billings in Australian public emergency departments (EDs) is a cost-effective strategy. This analysis demonstrates a significant positive net present value (NPV), confirming financial benefits.

Area of Science:

  • Health Economics
  • Public Health
  • Emergency Medicine

Background:

  • Accurate billing is crucial for healthcare funding.
  • Missed billing opportunities can impact public hospital revenue.
  • Emergency departments (EDs) face unique billing challenges.

Purpose of the Study:

  • To conduct a cost-benefit analysis of retrospectively identifying missed compensable billings in a public Australian ED.
  • To quantify the financial benefits of implementing a strategy for recovering lost revenue.

Main Methods:

  • Retrospective review of patient files from April 2018 to January 2019.
  • Reconciliation of patient records with historical billing data to identify discrepancies.
  • Financial modeling using Vose ModelRisk and R Studio, incorporating sensitivity analyses for various cost and recovery parameters.

Main Results:

  • 76,523 patients presented, with 2,737 deemed compensable.
  • 740 undocumented billing items identified, valued at $59,870 (Medicare Benefits Schedule) and $152,400 (Australian Medical Association).
  • Calculated Net Present Value (NPV) of $1,436,892 (MBS) and $3,657,600 (AMA) in perpetuity, indicating substantial long-term financial gains.

Conclusions:

  • All analyzed scenarios resulted in a positive NPV.
  • Retrospectively identifying missed compensable billings is financially advantageous for public Australian EDs.
  • Implementing such a strategy is recommended to improve revenue recovery.
Abstract

Keywords:
Australiacost-benefit analysisdelivery of health careemergency medical serviceemergency servicehospital

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