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HIStalk Interviews Rick Stockell

July 16, 2010 Interviews 1 Comment

Rick Stockell is president of Stockell Healthcare Systems of Chesterfield, MO.


Tell me what Stockell Healthcare Systems does.

We write software for patient access and revenue cycle management. By patient access, that’s the registration and scheduling components. The revenue cycle is all of the regular registration, ADT, charge capture, medical records interfaces such as a 3M encoder, a collections module, and the 837 and 835 back. Eligibility checking, medical necessity checking, and those types of things.

Our roots are all the way back to McDonnell Douglas Healthcare that was here in St. Louis. We’ve been in the healthcare market for quite a while. We were a contract programming group from McDonnell Douglas. We did a lot of development for McDonnell Douglas and their mainframe and minicomputer lines.

We go back to the original UB-82. We were writing that, so we’ve been in the patient accounting and billing space for years and really understand how it’s changed and how it’s evolved. We’ve got a tremendous amount of experience in the patient accounting area and we’re going to use that to our advantage as we pull this product together. We’ve been in the business a long time, so we’re not an upstart.

Maybe everybody’s more familiar with the company than I am, but I mostly remember back in the days where 3M used your order entry system for Care Innovation, if I recall.

That’s correct.

Who would be most familiar with the company today?

We typically partner with electronic medical record companies. We’ve partnered with, like you say in the past, 3M. Until GE bought IDX, they used us for the same thing — order communication and order management. We also partner with Medsphere, with OpenVista. DSS is another one. They tend to be in the government space more than others.

They don’t have revenue cycle solutions. When they compete against the other healthcare vendors in the marketplace and to have complete solutions, they need an answer for patient access and revenue cycle. We’ve partnered with them. We’ve done that multiple times with them.

Also, some new ones that are international. Alert is one out of Portugal. We are also partnering with Eclipsys internationally. We closed a deal in Kuala Lampur, Malaysia — Pantai Health System.

I saw that. How did that come to be? You don’t think of revenue cycle when you think international, yet you’ve got this string of hospitals in Malaysia.

It has to do more with the footprint of the product. It’s all on a Microsoft technology, so it doesn’t require mainframes or any of that type of thing.

A lot of the older patient accounting and billing systems — ones that have been in the market for years, really, 25, 30, maybe even 40 years in the case of the Invision product line — most of them came from batch-oriented systems. They require a lot of hardware, a lot of software, layered products, and bolt-ons for them to be useful. It’s just not conducive to the international market because there’s such a large amount of the architecture dedicated to third-party reimbursement here in the States and the regulatory environment here, so it’s a lot different there.

It’s a real-time system as opposed to batch. The footprint’s smaller and it’s easier to use. It’s very user-friendly. It makes sense really quick. It’s got a complete relational database designed underneath it. To configure it for different needs is relatively easy to do. We’re in a lot of different market settings — behavioral health, long-term psychiatric, government, all kinds of different reimbursement models.

At Indian Health, we have three sites. We’ve gone independent from the Indian Health Services and we’re opening our own facilities and they’re like a commercial private/public consortium. We’re very, very flexible in our abilities to implement different revenue cycle designs, Because of that flexibility, it lends itself to the international market.

You mentioned the Alert product and a couple of variations of the VistA product. How easy is it to coexist with those applications?

It’s actually very easy. I think we’ve integrated now with interfaces to about eight different clinical information systems; including Cerner and Eclipsys. We did it with GE as well, their original Centricity line. I think they re-labeled all that. Now it’s really the IDX product, but we haven’t integrated with the IDX system. But the precursor, the original versions of Centricity, we’ve integrated with. So, yes, we’ve done quite a few. In the behavioral health area, Sigmund, MindLink, and Sequest. 

We’re really, really good with HL7. You recalled we did order communication for 3M — their Care Innovation suite. We also built the order communication component for the original Centricity product for GE. Since we’ve had so much experience with HL7 integration with these electronic medical records and departmental systems, it’s really pretty straightforward for us to do integration to a clinical suite.

It sounds like you could either be the revenue cycle component for a vendor that has only the clinical and departmentals; or you could be the clinical component for someone who has the revenue cycle.

No, normally we’re really the revenue cycle. We’ll do some order communication if they don’t like order management. If they’re not really good HL7, bi-directional — you know, orders in and out and ADT and all that — if they’re really not good with HL7 or have limited capabilities with HL7, we can stand in as the order management system for them until such time as they can get that on board. Principally, we’re patient access and revenue cycle.

It seems like a lot of companies are either offering revenue cycle services or software, or both. What trends are you seeing out there since you’re the independent among that group?

The traditional revenue cycle sector is a lot of bolt-on technologies. They’ll work well or co-exist with Epic, Siemens, or McKesson and do a lot with the output of the bills. UBs and 1500s are produced off the primary patient accounting system. They do contract management, for example, a standalone; and then the 837 and 835, some of the electronic claims, and that type of thing. Maybe eligibility checking on the front end, that they just offer services that are really kind of bolt-on. They’re really integration-oriented, just in different pieces of an existing patient accounting system like the older ones.

Our approach is that we’ve built everything into the products, so contract management is part of the product. The eligibility checking and medical necessity checking is part of the product. We don’t need a bolt-on to do that. The 837 processing, 835 processing is embedded in the product so there’s less of a dependence on bolt-on technologies.

We find some of the bolt-on players are trying to get into where they can start to integrate more directly with the electronic medical record to increase their value. We can already do that, and have done that for about a decade now, plus, the order communication piece.

What would be the attraction for customers to look at your solution?

If they are in the market for a new electronic medical record system and they don’t have a good solution or it doesn’t integrate well. Their traditional system, their registration and patient accounting and billing systems — if they don’t integrate that well with the new EMR or if the vendor doesn’t have a good solution for that, then what we are is a replacement opportunity to replace that older patient accounting system with something that works more seamlessly with the electronic medical record. That’s so we can capture charges at the point of care if the electronic medical vendor that they choose doesn’t do charging very well. It handles the clinical components for orders and those end results, but it doesn’t do charging very well.

We can interface at the order level and convert those to charges — charge on order, charge on result — and map those orderable items to the appropriate charges. Then, of course we have a charge master and we can have the HCPCS codes and modifiers imbedded in the charges and make that a little bit more seamless, which reduces the batch charge entry requirement and less manual entry of charges.

I can see, with one of the VistA products or with Alert, they would probably bring you in as an option, but it must be tough if you’re trying to get replacement business. You’re competing against the vendor who’s already in-house. Is that difficult?

It can be because they’ve been in place for long periods of time, maybe 10 years or longer, that they’ve been working on the patient accounting system. But some of the problems with that is that they can’t get the reports they need. It’s difficult to get the information out of the system. They don’t have as good a control over the revenue cycle. Either their AR days are longer or there’s more leakage of cash or reimbursement because of all the integrations they have to do to the bolt-on products.

We can build a pretty good business case that it’s more seamless, it works better with the clinical information system, reduces the amount of staff that’s required versus a lot more automation in our solution. Where a lot of the other systems require a lot of manual touching — they’re more like inspection-based instead of exception-based — so there’s an opportunity for operational efficiency with using our system over some of the older mainframe or batch-oriented systems that have been in the market for years.

How do you think the Meaningful Use and the whole healthcare reform change is going to effect the revenue cycle side of everybody’s business?

It seems that regulatory compliance is one of the big change agents that are always in healthcare. With Meaningful Use and ICD-10 and some of those things, I think it’s going to have an impact on the back-end systems as well. I’m not sure that the clinical information systems just on the front end are going to be adequate to address all that successfully.

I know that in the case of ICD-10, specifically, you’re talking about a larger field length because it’s a larger coding method than the ICD-9; like six or seven digits versus like four or five. So then that’s a change of storage location. That’s got a lot of different places to go and fix that because they’re on traditional file systems where the applications were originally written. We’re already ready for ICD-10 because ICD-10 is what’s being used right now in Malaysia, so we have an advantage there.

I think that all these regulations, as they come along, are going to put a lot of pressure on the older systems. It may be the cost of making changes to those systems may be more than the vendors that own those products are willing to put into them.

I think with all the excitement about clinical systems, maybe people have forgotten about things like ICD-10. What are your thoughts on how that change is going to affect everybody?

There’s the coding. I think, in the medical records area particularly, where they’re coding; that there’s so many codes that coding method’s going to cause a lot of change for all of the medical records departments. With the Correct Coding Initiative, that’s a lot to learn. Everybody’s been on ICD-9 for quite a while and ICD-10 is a lot different.

Then, all those codes will have to filter through for the claims and the edits that come along with those. New codes are going to be a little bit more complex. I’m not sure what impact they would have, specifically, on the bills themselves, but that would open it up for a lot more rules. There may be a lot of gaps in the older systems that might take quite a while to fill when they move to ICD-10 and I think we’re ready for that.

What do you think about ERP systems?

That’s a very mature market. In the US, it’s Lawson, which seems to be the one that has most of the market share.

We are integrating with Oracle in Malaysia. That is an opportunity. Oracle had a couple of tries at trying to get into the healthcare vertical and hasn’t really had much success with that, especially in the US. I think that an opportunity to get into the healthcare market, probably internationally, is what we’re going to see more with Oracle.

We don’t run into PeopleSoft or SAP very often. Those seem to really high-end and geared more towards the manufacturing environment than healthcare, but I think they’re going to continue to do all right.

I think that most people have made decisions for the ERP system, but again, traditionally, accounts receivable would be part of that solution. But when you’re having to do everything down at the encounter level and case mix and all those types of things in healthcare, it really strains the architecture of those ERP systems, which seem to be much better suited for direct customer-vendor relationships as opposed to this third-party and multiple payers and coordination of benefits.

One of the other things that everybody’s paying some attention to, at least, is data warehouse, data retrieval, and business intelligence. What are you seeing in the marketplace for that?

That’s another bolt-on opportunity, it seems, in healthcare. That’s another thing that’s embedded in our products.

Since we’re on a Microsoft environment, you have the whole Analysis Services that’s part of SQL Server 2005. And now, 2008 is even stronger — we’ve got scorecards and analytics. The warehousing is built right into the product, so the detail source that’s coming from our applications feeds the warehouse directly. We’ve got some pretty good score-carding and reports right out of the application set that makes BI a lot easier.

For us, it’s not a bolt-on. The product automatically can see it’s a warehouse that has a lot of those key performance indicators and scorecards and analytics built right into them. For example, we have one for denial management because we get the 835 detail back. We post the details from the 835 so you can drill all the way down to the level of detail of a line item that would be on a bill. If that detail was passed from the 835 from the payer, we can capture all those details and report on that.

Elimination of denials is something that’s much easier for us to do. It’s integrated right into our collections module. If you get a denial, if it’s something that’s workable, we will map that denial right into the accounts receivable system. The user knows that there has to be some action item to clean that up or address that denial. We’re using the business intelligence and warehouse for operational efficiency and management insight.

Does that complement or compete with Amalga?

I don’t know if it competes with Amalga. I guess it could complement Amalga, but Amalga seems to be really more of a framework around the whole care delivery delivery model. Ours is operational efficiency — all of the revenue cycles like AR, days calculation ratio, collector productivity. Those types of things are what we’re using for the warehouse, as opposed to trying to capture various points of care. I think Amalga’s got a much broader approach to healthcare than we do. We’re more specific to our area.

You’ve been in the industry for a long time. Looking outside of your company and your products, what’s going to be happening over the next 5-7 years?

I think that moving from paper to electronic, there’s going to be a lot of workflow issues from that. I think the traditional batch system that we’ve had for quite some time –  they’re going to have to have replacements for that. I know that all of them — Siemens, McKesson, Eclipsys, etc. — have large revenue cycle systems that they’re trying to bring to market to replace those older systems. They’re usually larger. I think they’re really aimed up-market more than they are mid-market or even down-market.

I think there’s an opportunity at the community hospital level, for certain, because they do have money and they’re the ones that haven’t been able to automate like the larger institutions. They have more wherewithal to spend on electronic medical records. A lot of them already made decisions on what they’re doing. Then they’ve got those vendor relationships that probably are going to go with their revenue cycle solutions.

But you get into the community hospital space — the pressure to have an electronic medical record in place for Meaningful Use and all these other things — I don’t know that the revenue cycle systems are going to be able to keep up with the older revenue cycle systems that some of the smaller vendors have. They’ve got to be able to keep up with all that.

One that comes to mind is QuadraMed. QuadraMed’s had a difficult time trying to handle both the clinical R&D and the revenue cycle side, which is a tremendous amount of R&D. They’re kind of caught. They can’t go up-market very well; that’s pretty much saturated by the larger vendors. I think the community hospital space is underserved and I think it’s a great opportunity for us. In that real small footprint, we’re more affordable, easier to use, and have less moving parts when you start looking at all the bolt-ons that have been traditionally required. I think that’s an advantage for us.

Any concluding thoughts?

I think that we’re going to continue to see what we can do in the international space, continue to partner with clinical information system vendors that don’t have a revenue cycle component. There are people looking to get into the electronic medical record, but outside vendors that are taking a look at the US market and say, specifically for the community hospitals that the vendors served — and there’s a lot of competition out there and there’s a lot of clinical information systems that are already written and up and operational around the world — they’re looking at the US market, maybe, for an ability to expand for them. They won’t have a revenue cycle solution with the US regulatory and third-party. A company like ours that’s independent would be a good partnership opportunity for them.

We could help bring some competition into the US market, maybe, from overseas that hasn’t been here before.

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Currently there is "1 comment" on this Article:

  1. Man, that was some old school straight stuff. Good to hear a candid interviews about what really goes on behind the curtains with our legacy systems

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