Trauma Finance Optimization

Ask any hospital or trauma program leader to identify the most challenging aspect of trauma care, and the answer will be clear: trauma finance. Diligent Consulting offers consulting services designed to support healthcare organizations and trauma centers assess financial performance, optimize revenue, and ensure financial sustainability.

Who Is This Service For?

Trauma finance optimization services are ideal for several types of clients:

Hospitals evaluating the feasibility of adding a trauma program or elevating a trauma center level who want to understand the financial implications of the change
Current trauma centers who are unsure if they are making a profit or losing money on the trauma program
Trauma centers looking to add trauma charges or ensure compliance with current trauma charge practices

What Is Included in Trauma Finance Optimization Consulting Services?

Consulting services for trauma financial optimization include a narrow range of activities, typically involving your finance department, revenue cycle team, trauma program, and informatics team. These services typically include:

Market Overview

Analysis of your current trauma program and broader trauma market to understand your hospital's trauma volumes and payor mix, as well as volume lost to nearby trauma centers.

Trauma Readiness Costs Assessment

Trauma centers have strict requirements for trauma program administration, department costs to ensure 24/7 readiness, education and outreach, and medical staff coverage. We assess these costs and, if appropriate, forecast additional costs that would be incurred if you add a trauma program or change trauma levels.

Financial Overview

We produce an overview of your hospital's current and predicted financial performance related to trauma in terms of payor mix, expenses, revenue, reimbursement, and cost recovery. If your hospital is considering a new trauma program, we look at incremental costs and new volumes.

Impact of Emergency General Surgery (EGS) and Other Surgical Volumes

Trauma centers have strong surgical service lines, including EGS, orthopedic surgery, neurosurgery, and other specialties. We estimate the impact of trauma on non-trauma surgical volumes and revenue in these other specialties.

Trauma Charge Analysis

We will work with your revenue cycle and finance teams to understand current trauma charge practices, ensure your practices and charge amounts are in line with legal requirements, and identify opportunities to improve compliance and utilization of these charges.

Financial Data Integration

We will work with your team to build an easy-to-use financial summary for the trauma center that can be modified by your team to reflect changing assumptions and volumes. This document will be built in Tableau or a similar program and will incorporate real-time reports and data downloads from your other data systems. This allows for ongoing monitoring of the financial status of the trauma program.

Financial Dashboard

Trauma centers have a hard time producing financial dashboards because of discrepant data systems and lagged data reports. We will work with your finance team and trauma program to create a Trauma Finance Dashboard that can be updated regularly and reported to your Patient Safety and Performance Improvement (PIPS) Committee. If appropriate, we will help identify metrics and audit filters to monitor improvement over time.

Our Trauma Consulting Process

Understanding the typical steps involved in trauma finance optimization clarifies how consulting services add value:

Stakeholder Engagement. We will involve key personnel such as the finance team, the trauma program, revenue cycle, and informatics to gather data and understand current financial performance. We will also work with a representative familiar with your data systems to begin building reports and monitoring mechanisms within your data walls.
Data Gathering. We will request a dataset that matches trauma registry data with hospital financial data so we can understand current volumes and financial stability. We will also identify regional data sets (typically state trauma registry data or state hospital discharge data) to examine if your hospital is losing volume from the trauma service area to other trauma centers.
Trauma Readiness Cost Assessment. We will work with trauma program leadership, your finance department, and your Chief Medical Officer to review the requirements for your trauma center level and identify gaps in readiness. Those gaps will be quantified to come up with a total cost of trauma readiness.
Trauma Charge Assessment. We will gather representatives from various departments to understand trauma charge practices, assess trauma charge amounts, ensure the chargemaster is set up correctly, and identify discrete datapoints in the medical record to use to generate trauma charges. If deficiencies are identified, we will work with your team to build new workflows and ensure compliance with legal requirements for 068x and other trauma charges.
Assess Halo Effect. We know that trauma centers generate a "halo effect" by attracting patients to the hospital for other specialties. We will estimate the impact of the trauma center on other surgical volumes, particularly in emergency general surgery and orthopedic surgery.
Prepare Financial Summaries. We will gather all appropriate data to create a financial summary of expenses, revenue, payor mix, and cost recovery rates. Ideally we will work with a data aggregation specialist within your hospital to build the summaries in your native environment so they can interact with data in real-time and be used for long-term monitoring.
Plan for Financial Sustainability. We will identify opportunities to improve financial sustainability, especially in areas of payor negotiations, expense management, and trauma charge optimization.

What Are Some of the Greatest Challenges in Trauma Financial Optimization?

Just as healthcare finance is complex, and so too is trauma center finance. Some of the most common challenges include:

Payor Mix Volatility

Trauma center disproportionately treat uninsured patients, underinsured patients, and Medicaid populations. High volumes of these patients can erode profit margins. Additionally, private or commercial insurer negotiations are varied and difficult to predict.

Trauma Readiness Costs

Trauma readiness costs are those expenses that are incurred to ensure your hospital can meet requirements for its trauma center level. For example, higher-level trauma centers must have 24/7 readiness in the operating room, imaging, blood bank, and laboratory, so hospitals often incur an additional expense to ensure these departments are covered at night. Trauma readiness costs are static and don't fluctuate with volumes; for example, the night cost for call coverage and department readiness will be the same whether your hospital has a single patient or 10 patients. What makes this extra challenging is that trauma call coverage benefits other service lines and/or call coverage is shared with other programs (e.g. stroke, emergency general surgery) and shared resources (e.g. ED, OR, ICU, radiology) will be utilized for non-trauma patients. That makes it difficult to isolate how well these costs are recovered.

Isolating Expenses and Revenue

Because trauma services involve so many departments and service lines, it is challenging to identify expenses and revenue exclusive to trauma. Typically trauma finance includes the full pictures (all trauma patients in the trauma registry, even those cared for by services other than trauma surgery) or patients admitted to the hospital and managed by the trauma team.

Discrete Data Points and Incomplete Charge Capture

In a world of electronic medical data, it is remarkably challenging to isolate the essential data points required for trauma charges. Effective trauma charge practices must be built on reliable data fields and accurate clinical documentation. Trauma care happens fast and across multiple teams, making documentation and charge practices difficult. If a patient is not immediately identified as a trauma patient upon arrival, it is often challenging to find these patients retrospectively and make sure the right charges are applied. Additionally, when procedures are under-documented, revenue can be difficult to capture.

Limited Real-Time Revenue Monitoring

Billing data systems do not always talk to clinical data systems, and in some cases the patients have different identifiers in each system, making it difficult to link data and produce dashboards. Diligent consulting will work with your data aggregation specialists to build reports in your native environments as we work to integrate data sources and produce a single data dashboard.

Trauma Charge Rules and Regulatory Frameworks

Trauma charge practices have been around for decades, but scrutiny on those practices is at an all-time high. There are several conditions that must be met to utilize trauma charges, but silo-ed approaches and poor documentation can fragment this process and inadvertently lead to noncompliance. Overcharging risks audits and penalties; undercharging leaves significant money on the table.

How Can Diligent Consulting Help?

Organizations that invest in expert consulting will be better positioned to understand and optimize the financial status of their trauma program. Reach out today for a free consultation!