affiliation: A partnership typically between a smaller hospital and a larger hospital or healthcare system that allows the smaller entity to maintain local governance while leveraging the larger organization’s purchasing power and using its facilities and physicians.
acquisition: When a hospital sells all its assets to a buyer, which then assumes ownership.
bankruptcy: A legal proceeding for an individual or corporation that is unable to repay outstanding debts. If a hospital declares bankruptcy, the court will appoint an official to make an inventory of its assets and establish a schedule for partial repayment.
bond validation: A court’s determination before bonds are sold that they will be upheld as binding, valid and legally payable obligations. Hospitals sometimes use this process to enhance the attractiveness of their bonds as investments.
bundled payment model: Provides a single, comprehensive payment for all the services involved in an episode of patient care.
charge capture: A process used by healthcare providers to accurately record their performed patient services for proper reimbursement from payers.
chargemaster audit: Involves regular reviews of chargemaster data to make sure codes and pricing are compliant and current. Chargemaster updates help avoid underpayments, compliance violations and overpayment clawbacks.
clinical affiliation: A specific level of affiliation that gives a smaller facility access to specialists in exchange for transferring complex cases within those specialties to the larger organization.
coding audit: Regular reviews of coding compliance as well as the charge description master (CDM), or chargemaster, codes is key to identifying and correcting errors and error-prone processes that lead to claim denials.
coding compliance: Involves analyzing medical records and selecting the right codes for billing so that codes that could impact reimbursement or care delivery aren’t missed or mistaken.
communicable disease: An infectious disease that is transmissible by contact with infected individuals or their bodily discharges or fluids; by contact with contaminated surfaces or objects; by ingestion of contaminated food or water; or by direct or indirect contact with disease vectors (such as insects).
Community Health Needs Assessment (CHNA): A systematic process in which a hospital engages the community to identify its health needs; prioritizes those needs; and develops plans to meet them. Not-for-profit, charitable hospitals must conduct CHNAs every three years as mandated by the Affordable Care Act.
community hospitals: Defined by the American Hospital Association (AHA) as all nonfederal, short-term general, and other special hospitals, including obstetrics and gynecology; eye, ear, nose, and throat; long term acute-care; rehabilitation; orthopedic; and other individually described specialty services. Academic medical centers or other teaching hospitals also count if they are nonfederal short-term hospitals.
community outpatient hospital (COH): A provider type and Medicare payment designation proposed in the Save Rural Hospitals Act that would provide emergency care and observation care, with protocols in place for the timely transfer of patients who require a higher level of care or inpatient admission.
conditions of participation (CoPs): Centers for Medicare and Medicaid Services (CMS) CoPs are health- and safety-related federal regulations with which healthcare providers must comply in order to participate in (i.e., receive funding from) the Medicare and Medicaid programs.
corporate member substitution: A type of partnership that occurs when a larger entity becomes the corporate member of a privately held, not-for-profit hospital so the smaller entity can benefit from being part of the larger organization without relinquishing local governance.
critical access hospital (CAH): A designation given to eligible rural hospitals by the Centers for Medicare and Medicaid Services (CMS), designed to reduce the financial vulnerability of rural hospitals and improve access to healthcare by keeping essential services in rural communities. CAHs receive certain benefits to accomplish this goal such as cost-based reimbursement for Medicare services. By definition, CAHs maintain no more than 25 acute care beds and must be located more than 35 miles (or 15 miles by mountainous terrain or secondary roads) from the nearest hospital, with some exceptions.
debtor in possession (DIP): An individual or entity that has filed for bankruptcy protection but still lawfully holds property to which creditors have a legal claim. A DIP may continue to do business using those assets, with some limitations.
debtor-in-possession (DIP) financing: Allows a debtor in possession to raise capital to fund its operations as its bankruptcy case is in process.
emergency medical center (EMC): The American Hospital Association’s Task Force on Ensuring Access in Vulnerable Communities recommended an EMC operational strategy that would allow struggling hospitals to continue to meet the needs of their communities for emergency and outpatient services without having to provide inpatient acute care services.
global budgeting: Provides a fixed amount of funding for a fixed period (typically one year) for a specified population, rather than fixed rates for individual services or cases.
group purchasing organization (GPO): An entity created to leverage the purchasing power of a group of healthcare providers to obtain discounts from vendors based on the collective buying power of the GPO members.
hospital procurement data: Prices and other data associated with finding and acquiring supplies and services for the hospital. CHC recommends hospitals cross reference this data with their GPO’s contract list to identify opportunities for greater savings by converting to different products.
hospital tax district: Also called a public hospital district or just a hospital district, it describes an operational model whereby a tax-supported government entity operates the local community hospital.
infection control: The Centers for Disease Control and Prevention (CDC) recommended two tiers of risk assessment-based precautions to control and prevent the spread of infections in healthcare settings. Tier one, standard precautions (such as hand washing and use of PPE), are the minimum infection prevention practices that apply to all patient care. Tier two, transition-based precautions, are used when patients have diseases that can spread through contact, droplet or airborne routes and are always used in addition to Standard Precautions.
internal audit: An independent, objective consulting process to determine if internal controls are operating effectively. CHC Consulting’s Internal Audit Process provides hospital management with information and tools to attain operational efficiency and helps to identify problems and correct lapses before less favorable circumstances bring them to light.
interim management contract: An independent hospital may agree to a short-term, interim management relationship under certain circumstances; for example, when the CEO leaves and no suitable replacement is readily available.
just-in-time delivery: A lean inventory management method whereby supplies are scheduled to arrive or be replenished as needed, as opposed to stockpiling.
Long-term Acute Care Hospital (LTACH or LTCH): A specialty hospital designed for medically complex patients with acute or chronic conditions who require an extended hospital stay and highly specialized care.
meaningful use: An evolving term describing the practice of using electronic health record (EHR) technology in a meaningful way, ensuring that health information is shared and exchanged to improve patient care. The Centers for Medicare & Medicaid Services (CMS) encourages meaningful use through its Promoting Interoperability Programs.
merger: When hospitals combine assets to form a new entity.
managed care evaluation: When, for revenue cycle enhancement, a hospital reviews health plan contracts (CHC recommends reviewing the top five) to identify opportunities to improve contract terms, reimbursements, payment accuracy and timeliness.
management relationship: A type of partnership in which a hospital remains self-governing but abdicates day-to-day management responsibility to a third party.
operational assessment: A formal evaluation of a hospital’s operations, staffing, supply chain, revenue cycle, leadership and strategy with the aim of reducing costs and increasing revenue.
partnership: Includes several different types of relationships that hospitals forge, typically to strengthen their market position or to shore up finances. CHC Consulting works with hospitals to assess whether a relationship with another institution makes sense and if so, what type.
payer mix: The percentage of hospital revenue coming from sources including: private insurance companies, government insurance programs and self-paying patients. Payer mix is important to track because an unfavorable payer mix could lead to unfavorable financial trends.
PPE (personal protective equipment): Equipment worn to minimize exposure to hazards that can cause serious workplace injuries and illnesses. In healthcare, PPE includes face masks and shields, respirators, gloves, safety glasses and goggles, and protective garments such as gowns.
population health: The health outcomes of a group of individuals, including the distribution of such outcomes within the group. These groups are often geographic populations (e.g., communities) but can also be employees, ethnic groups or any other defined group.
productivity: In healthcare, managing productivity or labor relates to staffing adjustments that are appropriate and effective for high quality patient care.
productivity tool: Productivity monitoring tools help control labor costs by providing feedback on staffing levels, volume and productivity across all hospital cost centers. Implementation of CHC’s proprietary Productivity Tool can save a hospital 15 to 20 percent.
Promoting Interoperability Programs: Centers for Medicare & Medicaid Services (CMS) in 2011 established the Medicare and Medicaid Electronic Health Record (EHR) Incentive Programs (now known as the Promoting Interoperability Programs) to encourage eligible healthcare providers to adopt, implement, upgrade and demonstrate meaningful use of certified EHR technology. The name change in 2018 moved the programs beyond the existing requirements of meaningful use to a new phase of EHR measurement with an increased focus on interoperability and improving patient access to health information.
restructuring: Debt restructuring is a process some hospitals use to avoid the risk of defaulting on existing debt. The process is typically carried out by reducing the interest rates on loans, by extending the dates when the company’s liabilities are due to be paid, or both.
revenue cycle assessment: An end-to-end evaluation of a hospital’s revenue cycle designed to increase net revenue, accelerate cash collection and reduce cost. Some of the areas of improvement include renegotiating health plan contracts, adjusting patient registration processes, charge capture process improvement, medical record coding audits, and tracking billing and collection metrics.
risk management assessment: Evaluates a hospital’s risk management and insurance programs to identify appropriate levels of coverage, potential savings, enhancements to terms and conditions, as well as any vulnerabilities.
Rural Emergency Acute Care Hospital (REACH) Act: Proposed legislation would allow certain small rural hospitals and critical access hospitals (CAHs) to phase out inpatient beds and convert to designated rural emergency hospitals in order to sustain healthcare in rural America.
rural emergency medical center (REMC): A proposed new rural facility designation under the Medicare program offering 24/7 emergency care with protocols in place for the timely transfer of patients who require inpatient services.
service mix: The type and range of services a hospital offers. Service mix is an important consideration because some services are reimbursed at higher rates than others.
social determinants of health: Conditions where people live, learn, work and play that affect their health risks and outcomes. Examples: unsafe neighborhoods, substandard housing, second-hand smoke.
standard charges: The Centers for Medicare and Medicaid Services (CMS) Price Transparency Final Rule requires hospitals to post their “standard charges” online. Standard charges, as defined by CMS, include: gross charges; discounted cash prices; payer-specific negotiated charges; de-identified minimum negotiated charges; and de-identified maximum negotiated charges.
supply chain management: Healthcare supply chain management involves sourcing and procuring resources, managing inventory, and delivering goods and services to providers and patients.
technical default: A lapse in a loan agreement that arises from a failure to uphold certain aspects of the loan terms other than the regularly scheduled payments.
telemedicine (telehealth): The remote diagnosis and treatment of patients by means of telecommunications technology.
tripped bond covenant: A bond covenant violation that puts the issuer into technical default.
unit practice council (UPC): Formal groups that represent each nursing unit and include frontline clinical staff (not just nurses) in decision making. Also known as unit-based shared governance councils.
USAC RHC Telecommunications Program: Universal Service Administrative Company (USAC) annually makes available more than $600 million in federal funding (FY2020 cap) through the Rural Health Care (RHC) Telecommunications Program to ensure that qualifying rural health care providers — or urban area hospitals that draw from rural areas or have rural clinics — can obtain telecommunications and internet services at rates comparable to urban providers.
value-based care: A healthcare delivery model in which providers, including hospitals and physicians, are remunerated for helping patients improve their health, reduce the effects and incidence of chronic disease, and live healthier lives in an evidence-based way.
value-based reimbursement: A payment model in which providers, including hospitals and physicians, are paid based on patient health outcomes, as opposed to a fee-for-service approach in which providers are paid based on the amount of healthcare services they deliver.