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Guidance on cutting hospitals’ red tape.

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The American Hospital Association has  released a new TrendWatch report  that looks at the need for administrative simplification in hospitals.  Among other things, the AHA  recommends that hospital executives adopt a series of transaction standards from HIPAA to let hospitals and health plans communicate with one another electronically.

And the report’s authors suggest  seven specific steps to “bend the adoption curve for administrative simplification”:

  1. “Consolidate administrative processes to achieve economies of scale.
  2. “Recognize the steps in financial management as a set of interrelated processes.
  3. “Address the interrelatedness of clinical and financial data.
  4. “Cultivate a relationship of trust between providers and health plans.
  5. “Move fully to electronic processes.
  6. “Eliminate redundancies in the financial process by replacing manual paper and phone-based legacy processes in health plans by replacing these with automated routines.
  7. “Change what you can.
  8. “Work collectively to promote administrative simplification.”

The AHA’s Hospitals & Health Networks notes that TrendWatch report also offers “a few success stories of health systems that have implemented the HIPAA standards and seen efficiency skyrocket while costs dropped. San Francisco-based Dignity Health system, for one, has been able to reduce the time it takes to submit a claim to a health plan to just two or three days, and expects it to drop to just one day by using electronic processes to ensure accuracy and completeness. Nashville-based HCA, meanwhile, has experienced a 70 percent reduction in processing costs by using electronic fund transfers, rather than paper checks, according to the report. ”

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